Annual Report 30 June 2010 - Hunter Hall Investment Management

HUNTER 

HALL 

Ethical 

Managed Funds 

Hunter Hall 

Value Growth Trust 


Global Ethical Trust 


Australian Value Trust 

Annual Report 

30 June 2010

Directory 



ARSN 093 079 906 



ARSN 098 586 282 



ARSN 098 586 586 

Custodian 

BNP Paribas Fund Services Australasia Pty Ltd 

ABN 71 002 655 674 

BNP Paribas Centre 

Level 6, 60 Castlereagh Street 

Sydney NSW 2000 Australia 

Auditor 

Grant Thornton NSW 

Level 17, 383 Kent Street 


Responsible Entity 

Hunter Hall Investment Management Limited 

ABN 69 063 081 612 

ACN 063 081 612 

AFSL 219462 

Registered Office 



Telephone: +61 2 8224 0300 

Facsimile: +61 2 8224 0333 

London Research Office 

Level 4, 53 Frith Street 

London W1D 4SN UK 

Telephone: +44 207 734 4044 

Facsimile: +44 207 734 4045 

Investor Relations 

You can obtain information about investing in the Hunter 

Hall Funds including the latest unit price via: 

• internet: www.hunterhall.com.au 

• telephone: 1800 651 674 

0800 448 305 (New Zealand callers) 

+ 612 8224 0300 (international callers) 

• email: invest@hunterhall.com.au 

Address for Applications and Redemptions 


Reply Paid 3955 

Sydney NSW 2001 Australia

Contents 

Directors’ Report 2 

Statements of Comprehensive Income 7 

Statements of Financial Position 8 

Statements of Changes in Equity 9 

Statements of Cash Flows 10 

Notes to the Financial Statements 11 

Directors’ Declaration 32 

Auditor’s Independence Declaration 33 

Independent Auditor’s Report 34 

Hunter Hall Equity Funds Annual Report 2010 1

Directors’ Report 

The Directors of Hunter Hall Investment Management Limited (the Responsible Entity), submit herewith the annual 

Financial Reports of the Hunter Hall Value Growth Trust (VGT), the Hunter Hall Global Ethical Trust (GET) and the 

Hunter Hall Australian Value Trust (AVT) (the Hunter Hall Equity Funds or Funds) for the year ended 30 June 2010 in 

accordance with ASIC Class Order 06/441. In order to comply with the provisions of the Corporations Act 2001, the 

Directors report as follows: 

Directors 

The names of the Directors of the Responsible Entity during or since the end of the financial year are: 

William Wayne Hawkins B.Ec., F.Fin., FAICD 

(appointed Chairman effective 1 July 2009) 

Non-executive Chairman 

Mr Hawkins is a Non-executive Director of Hunter Hall 

Investment Management Limited. He is also Lead Nonexecutive 

Director of Hunter Hall International Limited 

and Chairman and Director of Hunter Hall International 

Ethical Fund, both of which are publicly listed entities. He 

is Chairman of the Hunter Hall International Limited Risk 

Management Committee, Audit Committee and of the 

Remuneration and Nominations Committee. 

Mr Hawkins has over 42 years experience in investment 

management. Previously he was Funds Manager and 

Investment Analyst with City Mutual Life Assurance Society 

Limited, Group Investment Manager with New Zealand 

South British Insurance, Chief Executive of NZI Investment 

Services Limited, Chief Investment Officer and Managing 

Director (Funds Management) with Oceanic Capital 

Corporation Group. 

Peter James Macdonald Hall B.A. 

(resigned from the Board effective 1 July 2009) 

Executive Chairman 

Mr Hall was Executive Chairman of Hunter Hall Investment 

Management Limited. He is Executive Chairman and 

Executive Director of Hunter Hall International Limited 

and Hunter Hall Global Value Limited and a Director of 

Hunter Hall International Ethical Fund plc, all of which are 

publicly listed entities. He is Chief Investment Officer of 

Hunter Hall Investment Management Limited and a 

Director of the international research subsidiary Hunter 

Hall International (UK) Limited. He is a Trustee of the 

Hunter Hall Charitable Trust, a member of the Hunter 

Hall Charity Committee and of the Remuneration and 

Nomination Committee. 

Mr Hall is also Deputy Chairman of Prospect Publishing, a 

Patron of the Asian Rhino Project and Sea Shepherd UK, a 

Director of the International Rhino Foundation, a member of 

the Sydney Film Festival Council and a Trustee of the Bedales 

Grants Trust Fund and of the ABC Trust, a UK based charity. 

Mr Hall has 27 years experience in investment markets. 

Previously he was Investment Manager of Hancock & Gore 

Limited, Portfolio Manager and Analyst with Mercantile 

Mutual Holdings Limited, Industrial Analyst with Pembroke 

Securities Limited, Investment Analyst with New Zealand 

South British Insurance Limited and a journalist with John 

Fairfax & Sons Limited. 

Mr Hall completed the Harvard Business School 

Owner/President Management Program in 2003. 

Mr Hall was awarded Member (AM) of the Order of 

Australia in 2010 for his philanthropic contributions to 

society and his service to the finance management industry. 

David Barclay Buckland B.Comm., M.App.Fin., 

F.Fin, FCPA, FCIS 

Executive Director, Chief Executive Officer 

Mr Buckland is Executive Director, Chief Executive Officer 

and Senior Portfolio Manager of Hunter Hall Investment 

Management Limited. He is also Executive Director of 

Hunter Hall International Limited, a publicly listed entity. 

Mr Buckland is also a Director of Bennelong Administration 

Services Pty Limited and of the international research 

subsidiary Hunter Hall International (UK) Limited. 

Mr Buckland was appointed CEO of Hunter Hall 

Investment Management Limited in 2001, when funds 

under management were under $200m. 

Mr Buckland has 26 years of industry experience with ten 

years in stockbroking in Sydney and London and the 

balance in funds management. Previously he was a Director 

of JP Morgan Securities Australia, Research Analyst at 

Statton Securities and Portfolio Manager – Equities as well 

as Investment Manager at NZI Corporation, where he was 

responsible for over $1b of investment funds. 

Mr Buckland completed the Harvard Business School 


2 Hunter Hall Equity Funds Annual Report 2010


Jack Theseus Lowenstein M.A. (Oxon) 

(resigned from the Board effective 2 June 2010) 

Executive Director 

Mr Lowenstein is Deputy Chief Investment Officer and Senior 

Portfolio Manager of Hunter Hall Investment Management 

Limited, monitoring and researching Australian and Asian 

companies and advising on matters relating to corporate 

governance in the Hunter Hall Funds’ Australian investments. 

Mr Lowenstein resigned from the Board as Executive Director 

on 2 June 2010 to ensure the composition of the Board was 

made up of a majority of Non-executive Directors. 

He is also Executive Director of Hunter Hall International 

Limited and of Hunter Hall Global Value Limited, both of 

which are publicly listed entities. He is a member of the 

Hunter Hall International Limited Risk Management 

Committee. 

Mr Lowenstein is also Chairman of Kontiki Capital 

Limited, a Fiji based investment bank, and is a Director of 

Calliden Group Limited. 

Mr Lowenstein has 17 years experience in investment and 

corporate finance. Previously he had eight years 

researching and reporting on international markets for the 

Euromoney Publications magazine group. 

Mr Lowenstein completed the Harvard Business School 


Mark Benedict Forstmann B.Sc., B.A. (Comm) 

(appointed to the Board effective 1 July 2009) 

Non-executive Director 

Mr Forstmann was appointed a Non-executive Director of 

Hunter Hall Investment Management Limited on 1 July 

2009. Mr Forstmann is also a Non-executive Director of 

Hunter Hall International Limited, a publicly listed entity 

and a member of the Hunter Hall International Limited 

Audit Committee and Risk Management Committee. 

Mr Forstmann has 22 years experience in investment 

markets including equities, currencies and fixed interest. 

Between 1986 and 1994 he worked at Bank America and 

Banque Indosuez in Sydney and Paris. At Banque Indosuez 

he was primarily involved in proprietary trading of bonds 

and currencies in Australian and European markets. Since 

1995 he has focused on film and television production. 

Richard Hazen Taylor B.Ec., ACA 

(resigned from the Board effective 29 April 2010) 


Mr Taylor was appointed a Non-executive Director of 

Hunter Hall Investment Management Limited on 1 July 

2009 and resigned on 29 April 2010. 

Mr Taylor is a chartered accountant and formerly a tax 

partner for 20 years with Deloitte and its antecedent firms. 

In this role, he gained deep experience in structuring and 

advising on mergers and acquisitions, helping companies 

IPOs and structuring funding arrangements across a broad 

range of industries. He also has strategy and management 

expertise gained from leading the Deloitte Australia Private 

Equity Team and from being a member of their National 

Tax Executive. 

For more than 10 years Mr Taylor has advised a broad 

range of companies in the funds management industry in 

the structuring of their funds and in designing equity 

incentive arrangements for their key executives. 

Mr Taylor is also Chairman of the listed entity 

Fluorotechnics Limited. 

Mr Taylor gained his Bachelor of Economics at the 

University of Sydney. 

Suzanne Mary Daniel M.A. (Journalism), B.A. 

(Comm.), ATCL, MAICD 

(Director from 5 May 2010 to 30 May 2010) 


Ms Daniel was a Director for the period from 5 May 2010 

to 30 May 2010. This was a temporary appointment to 

maintain a majority of Non-executive Directors on the 

Board. During that period she received no remuneration in 

relation to the role. 

Company Secretary 

Ouafaa Karim B.A., M.Com Law, Grad Dip (Corp 

Management), SIA (Aff). 

Group Company Secretary, Compliance and Risk Manager 

Ms Karim has been the Group Company Secretary and 

Compliance & Risk Manager since 1998 and is also 

Executive Director of Bennelong Administration Services 

Limited. She is a Trustee of the Hunter Hall Charitable 

Trust, a member of the Hunter Hall Charity Committee 

and of the Compliance Committee. 

Ms Karim is also President of the Responsible Investment 

Association Australasia and is a member of the IFSA 

Regulatory Affairs Board Committee and the AFSA NSW 

Executive Committee. 

Ms Karim has over 25 years experience in the finance 

industry including corporate management, company 

secretarial, unit trust administration, compliance, operations 

and custody. Previously Ms Karim was employed by Aetna 

Funds Management (Australia) Limited, Permanent Trustee 

Company Limited and State Street Australia Limited. 



Principal Activities 

The principal activity of each of the Funds is the investment 

and management of securities in accordance with their 

respective investment objectives and guidelines as set out in 

the current Product Disclosure Statement (PDS) and in 

accordance with the provisions of each of the Funds’ 

Constitutions. 

The Constitution of each Fund authorises investments in a 

wide range of assets, including securities listed on the 

Australian and international stock exchanges (the 

international component is restricted to New Zealand for 

the AVT). It is the Responsible Entity’s current policy to 

restrict investment to listed securities, securities to be listed, 

exchange traded options and cash, or cash alternatives, 

including gold bullion, in a manner consistent with the 

stated investment objectives of each of the Funds. 

There has been no significant change in the activities of any 

of the Funds during the financial year. 

Ethical Investment Policy 

Hunter Hall is committed to the concept of responsible 

investing and seeks to avoid investing in businesses that are, 

in its opinion, involved in activities that are harmful to 

people, animals or the environment. 

The VGT, GET and AVT use a negative screen. In practice 

this means that the screening process seeks to avoid 

investment in companies that derive operating revenues 

from direct and material business involvement in: 

• the manufacture or sale of weapons and weapons 

components 

• tobacco manufacture 

• gambling outlets or systems 

• intensive animal farming 

• animal testing for cosmetics 

• activities that give rise to human rights violations 

• unremediated destruction of the environment, and 

• uranium mining and nuclear reactors 

While the negative screen as described above may seem 

straightforward, investors should be aware that from time to 

time borderline cases arise where it is unclear whether a 

potential investment should be rejected or not. In such 

cases the Directors of both Hunter Hall Investment 

Management Limited (the Responsible Entity) and Hunter 

Hall International Limited (HHL) retain the right to 

exercise their collective judgement and will take the merits 

of the investment into account. 

Acknowledging the difficulty with such borderline cases, 

Hunter Hall follows a policy of transparency and aims to 

provide as much information about each of the Funds’ 

investments as possible. 

Investors should be aware that our negative screen does not 

restrict investment in businesses engaged in mining, the 

manufacture or sale of alcohol, or which use animal byproducts. 

We are of the view that mining does not necessarily cause 

permanent damage to the environment provided that due 

attention is paid to site remediation, control of contamination, 

worker safety and the welfare of any nearby population. 

Labour standards are not taken into account in the 

selection, retention or realisation of these investments. 

The Hunter Hall investment team monitors all investments 

in each of the Funds. In the event that the activities of an 

investee company change, or if additional information 

becomes available such that the investment is considered to 

breach the Ethical Investment Policy, the investment is 

disposed of as soon as practicable. When disposing of an 

asset under such circumstances Hunter Hall endeavours to 

dispose of the asset for the best price it reasonably can, 

taking into account liquidity and other market forces. It is 

possible therefore that disposal of such an investment could 

extend over a period of time. 

To support the integrity of the policy, an independent 

consultant carries out an annual review of all companies in 

the Hunter Hall portfolios. This process highlights any 

exposures that require more research to test the conformance 

of each company with the screening rules. The third annual 

ethical review has been completed and was conducted by 

CAER – Corporate Analytics Enhanced Responsibility. 

Charitable Giving 

Hunter Hall International Limited (HHL), the parent 

company of the Responsible Entity, donates 5% of its pre-tax 

profits to charities or charitable purposes. The Responsible 

Entity has also elected to donate a portion of its fees from 

the Hunter Hall Global Deep Green Trust to charity: 

• 0.5% of the 1.6% annual Management Fee 

• 20% of any Performance Fee earned 

The Hunter Hall Shareholder Nominated Charitable 

Donations Scheme allows Shareholders, on a basis 

proportional to the number of shares they own, to nominate 

Australian registered charities for the receipt of donations. 

Each year, Shareholders receive a form which lists a variety of 

charities designed to represent a full spectrum of charitable 

concerns so that each Shareholder will be able to select a 



charity that accords with their area of interest. The list of 

charities was intially chosen in consultation with charity 

research specialist Givewell and is reviewed annually by the 

Hunter Hall Charitable Donations Scheme Committee. 

For the year to 30 June 2010 the donations of 5% of pre-tax 

profits were $920,103 (2009: $836,925), from Management 

Fees were $46,307 (2009: $36,541) and from Performance 

Fees were $34,571 (2009: $32,944). 

Transparency 

The Responsible Entity has a policy of transparency and 

communication in relation to investments. Monthly reports 

on each of the Funds’ investments are available on the Hunter 

Hall website or by request. An annual Report to Investors, 

which gives extensive information on the portfolios, is sent 

to all Unitholders and supporting advisors each year. 

In addition Unitholders and supporting advisors are invited 

to Hunter Hall’s Annual Investors and Advisors Meeting. 

The Responsible Entity has a strict policy for share trading 

by Directors, employees and their associates by which they 

are prohibited from investing in shares held by the Funds 

without the prior consent of the Chairman, Chief Executive 

Officer or the Board. 

The Responsible Entity also has a policy of trading units in 

the Funds by Directors, employees and their associates by 

which they are prohibited from investing in units of each of 

the Funds without the prior consent of the Board. 

Review of Results and Operations 

The net income/(loss) after distributions paid and distributions for the year for each Fund: 

Net profit 

Distributions paid 

Results 2010 2009 2010 2009 

Fund $’000 $’000 $’000 $’000 

VGT 96,776 (300,123) 56,698 - 

GET 24,113 (113,920) - 3,048 

AVT 16,709 (24,756) 498 1,358 

Distributions paid during the financial year: 

2010 2009 

Distributions June December June December 

Fund cents per unit cents per unit cents per unit cents per unit 

VGT 5.2437 5.5458 - - 

GET - - - 0.7862 

AVT - 0.7529 0.4864 1.4691 

For the year ended 30 June, the Indirect Cost Ratio for each Fund was: 

Including Performance Fee 

Excluding Performance Fee 

Indirect Cost Ratios 2010 2009 2010 2009 

Fund % % % % 

VGT 1.85 1.88 1.85 1.88 

GET 2.09 2.07 2.09 2.07 

AVT 2.13 2.17 2.13 2.17 

The following table shows the net assets and the unit redemption price of each Fund as at 30 June: 


Net assets Unit redemption price Net assets Unit redemption price 

Financial Position (post-distribution) (pre-distribution) (post-distribution) (post-distribution) 

Fund $’000 $ $’000 $ 

VGT 1,066,057 2.0806 950,631 1.8348 

GET 321,123 1.0805 347,734 1.0083 

AVT 82,090 1.2774 67,305 1.0204 



Subsequent Events 

There has not been any matter or circumstance, other than 

that referred to in the Financial Statements or Notes 

thereto, that has arisen since the end of the financial year 

that has significantly affected, or may significantly affect, 

the operations of each of the Funds, the results of those 

operations, or the state of affairs of each of the Funds in 

future financial years. 

Future Developments 

Each Fund will continue to be managed in accordance with 

its investment objectives and guidelines as set out in the 

current PDS and in accordance with the provisions of the 

Constitutions of each Fund. Future results will accordingly 

depend on the performance of the investments and 

markets to which the Funds are exposed. 

Options Granted 

In accordance with each of the Funds’ Constitutions no 

options have been: 

i. granted over unissued units in each of the Funds during 

or since the end of the financial year 

ii. 

granted to the Responsible Entity 

Indemnification of Officers of the 

Responsible Entity and Auditors 

During or since the financial year, no Fund has indemnified 

or made a relevant agreement to indemnify an officer of the 

Responsible Entity, auditor of the Funds or of any related 

corporate body against a liability incurred by an officer of 

the Responsible Entity, Auditor of the Funds or of any 

related corporate body. In addition, each Fund has not paid, 

or agreed to pay, a premium in respect of a contract 

insuring against a liability incurred by an officer of the 

Responsible Entity or an Auditor of each of the Funds. 

The Directors’ and Officers’ Liability Insurance cover is 

included under the Responsible Entity’s Investment 

Management Insurance Policy. It provides cover against all 

costs and expenses involved in defending legal actions and 

any resulting payments arising from a liability to persons 

(other than the Responsible Entity or a related body 

corporate) incurred in their position as Director or 

Executive Officer unless the conduct involves a wilful breach 

of duty or an improper use of inside information or position 

to gain advantage. 

Environmental Regulation 

The operations of each Fund are not subject to any 

particular or significant environmental regulations under a 

Commonwealth, State or Territory Law. 

Scheme Information in the 

Financial Report 

Fees paid to the Responsible Entity and its associates out of 

each Fund’s property during the financial year are disclosed 

in Note 13 to the Financial Statements. 

The number of interests in each Fund issued during the 

financial year, withdrawals from each Fund during the 

financial year, and the number of interests in each of the 

Funds at the end of the financial year are disclosed in Note 

12 to the Financial Statements. 

The value of each Fund’s assets at the end of the financial 

year is disclosed in the Statement of Financial Position as 

’Total Assets’ and the basis of valuation is included in Note 

2 to the Financial Statements. 

Rounding of Amounts 

Each of the Funds is of a kind referred to in Class Order 

98/100, issued by the Australian Securities and Investments 

Commission, relating to the rounding-off of amounts in the 

Financial Reports. Amounts in the Financial Reports have 

been rounded off in accordance with that Class Order to 

the nearest thousand dollars. 

Auditor’s Independence 

Declaration 

A copy of the Auditor’s Independence Declaration as 

required under s.307c of the Corporations Act 2001 in 

relation to the audit of the Financial Report of each Fund 

for the year ended 30 June 2010 is set out on page 33 and 

forms part of this report. 

The Report is signed in accordance with a resolution of the 

Directors of the Responsible Entity made pursuant to 

s.298(2) of the Corporations Act 2001. 

On behalf of the Directors of Hunter Hall Investment 

Management Limited 

David Barclay Buckland 


6 Hunter Hall Equity Funds Annual Report 2010 

Sydney 

2 September 2010

Statements of Comprehensive Income 

Year ended 30 June 2010 

Notes VGT GET AVT 

2010 2009 2010 2009 2010 2009 

$’000 $’000 $’000 $’000 $’000 $’000 

Revenue 

Dividend income 21,274 15,378 6,108 5,382 1,858 2,111 

Interest income 5,372 11,367 690 5,727 660 648 

Sub-underwriting commission 232 - 33 - 151 - 

Other income 7 43 16 3 - - 

Realised foreign exchange gains - 530 - - - - 

Total revenue 26,885 27,318 6,847 11,112 2,669 2,759 

Fair value changes 

Changes in fair value of investments 3 151,228 (309,362) 37,953 (104,671) 16,483 (24,640) 

Total gains/(losses) on investments 151,228 (309,362) 37,953 (104,671) 16,483 (24,640) 

Expenses 

Distributions to Unitholders 4 (56,698) - - (3,048) (498) (1,358) 

Management fees 5a (18,081) (15,429) (6,320) (7,094) (1,641) (1,267) 

Performance fees 5a - - - - - - 

Realised foreign exchange losses (3,711) - (13,339) (9,136) - (1) 

Other expenses 5b (2,847) (2,650) (1,028) (1,083) (304) (249) 

Total expenses (81,337) (18,079) (20,687) (20,361) (2,443) (2,875) 

Net profit/(loss) for the year 96,776 (300,123) 24,113 (113,920) 16,709 (24,756) 

Other comprehensive income - - - - - - 

Changes in net assets attributable 

to unitholders 96,776 (300,123) 24,113 (113,920) 16,709 (24,756) 

The above Statements of Comprehensive Income should be read in conjunction with the accompanying Notes. 


Statements of Financial Position 

as at 30 June 2010 



$’000 $’000 $’000 $’000 $’000 $’000 

Assets 

Cash and cash equivalents 6a 151,412 179,509 50,466 86,215 17,499 16,680 

Investments 7 935,628 771,896 268,105 265,987 65,051 51,174 

Trade and other receivables 8 9,770 3,064 3,261 1,058 268 94 

Total assets 1,096,810 954,469 321,832 353,260 82,818 67,948 

Liabilities 

Trade and other payables 9 3,166 3,838 709 5,526 728 321 

Distribution payable 10 27,587 - - - - 322 

Total liabilities (excluding net 

assets attributable to unitholders) 30,753 3,838 709 5,526 728 643 

Net assets attributable to 

unitholders 11 1,066,057 950,631 321,123 347,734 82,090 67,305 

The above Statements of Financial Position should be read in conjunction with the accompanying Notes. 


Statements of Changes in Equity 


VGT GET AVT 


$’000 $’000 $’000 $’000 $’000 $’000 

Opening balance - - - - - - 


to unitholders - - - - - - 

Closing balance - - - - - - 

For the purposes of these Financial Reports net assets attributable to unitholders is classed as a liability rather than as equity. As a 

result, the Funds do not have any equity reflected in the above Statements of Changes in Equity. 

The above Statements of Changes in Equity should be read in conjunction with the accompanying Notes. 


Statements of Cash Flows 




$’000 $’000 $’000 $’000 $’000 $’000 

Cash flows from operating 

activities 

Interest received 5,699 12,118 692 6,374 543 674 

Dividends received 20,060 15,269 5,770 5,347 1,807 2,153 

Management, performance and 

entry fees paid (17,811) (16,113) (6,363) (7,389) (1,613) (1,327) 

Payments to suppliers (3,111) (2,656) (4,977) (780) (327) (255) 

Sundry income/(expense) 239 43 (65) 3 151 - 

Net cash flows provided by/ 

(used in) operating activities 6b 5,076 8,661 (4,943) 3,555 561 1,245 

Cash flows from investing activities 

Investments purchased (403,247) (408,532) (110,356) (186,308) (27,382) (20,900) 

Proceeds from investments sold 379,299 436,284 122,003 191,574 30,384 34,860 

Net cash flows (used in)/provided 

by investing activities (23,948) 27,752 11,647 5,266 3,002 13,960 

Cash flows from financing activities 

Proceeds from issue of units 156,676 97,673 43,306 48,911 13,746 8,302 

Payments for redemption of units (148,033) (169,037) (94,030) (105,474) (15,877) (16,143) 

Payment of distributions (19,106) (10,245) - (2,531) (613) (1,431) 

Net cash flows used in financing 

activities (10,463) (81,609) (50,724) (59,094) (2,744) (9,272) 

Net (decrease)/increase in cash 

and cash equivalents held (29,335) (45,196) (44,020) (50,273) 819 5,933 

Cash and cash equivalents at 

beginning of year 179,509 223,963 86,215 143,386 16,680 10,747 

Effect of foreign currency exchange 

rate changes on cash and cash 

equivalents 1,238 742 8,271 (6,898) - - 

Cash and cash equivalents at 

end of year 6a 151,412 179,509 50,466 86,215 17,499 16,680 

The above Statements of Cash Flows should be read in conjunction with the accompanying Notes. 


NOTES to the Financial Statements 


1. Financial Reporting Framework 

Statement of compliance and basis of 

preparation 

These general purpose Financial Reports have been prepared 

in accordance with the requirements of each Fund's 

Constitution (as amended), Australian Accounting Standards, 

Australian Accounting Interpretations, other authoritative 

pronouncements of the Australian Accounting Standards 

Board and the Corporations Act 2001 in Australia. 

The Financial Reports comply with all Australian equivalents 

to International Financial Reporting Standards (AIFRS) in 

their entirety. Compliance with AIFRS ensures that the 

Financial Reports also comply with International Financial 

Reporting Standards (IFRS) in their entirety. 

The Financial Reports have been prepared on an accruals 

basis and are based on historical costs, except where stated, in 

accordance with the requirements of each Fund's Constitution. 

Fund investments are revalued to fair value. Cost is based on 

the fair value of the consideration given in exchange for assets. 

This Annual Report covers each Fund as an individual entity. 

Each Fund is a managed scheme established and domiciled in 

Australia. 

The Funds have the same Responsible Entity, Hunter Hall 

Investment Management Limited and have presented their 

Financial Reports in a single document as permitted by ASIC 

Class Order 06/441. 

2. Summary of Significant 

Accounting Policies 

Accounting policies are selected and applied in a manner 

which ensures that the resulting financial information 

satisfies the concepts of relevance and reliability, thereby 

ensuring that the substance of the underlying transactions 

and other events is reported. 

The following significant accounting policies have been 

adopted in the preparation and presentation of the 

Financial Reports: 

a. Revenue and expenses 

Dividend income is recognised on a receivable basis on the 

date shares are quoted ex-dividend. 

Distribution income is recognised on a receivable basis as of 

the date the unit value is quoted ex-distribution. 

Interest from fixed interest and discount securities is 

recognised as income on the basis of accumulated 

entitlement that would be received on the disposal of the 

security according to the trading practices accepted by the 

market for the relevant security. Interest on cash on deposit 

is recognised in accordance with the terms and conditions 

which apply to the deposit. 

b. Income tax 

Under current legislation each of the Funds are not subject 

to income tax, provided taxable income including 

assessable capital gains is fully distributed to Unitholders. 

c. Cash and cash equivalents 

Cash and cash equivalents includes cash on hand and in 

banks, and money market investments readily convertible to 

cash within two working days, net of outstanding overdrafts. 

d. Fair value of financial assets and 

liabilities 

Recognition and initial measurement 

Financial assets and liabilities are recognised when each 

Fund becomes a party to the contractual provisions of the 

instrument. For financial assets this is equivalent to the date 

that the Fund commits itself to either the purchase or sale 

of the asset (i.e. trade date accounting is adopted). 

Financial assets and liabilities are valued at fair value. 

Financial instruments are classified into the following 

categories and fair values of financial instruments are 

determined on the following basis: 

i. Investments 

All investments are initially recognised at cost, being the 

fair value of the consideration given including 

acquisition charges associated with the investment. After 

initial recognition, investments have been classified as 

designated ‘fair value through profit or loss’. Gains and 

losses on investments are recognised in the Statements 

of Comprehensive Income. Investment performance is 

measured and evaluated by Key Management Personnel 

on the basis of fair value movement and managed in 

accordance with the documented investment strategy. 

Investments traded in an organised financial market 

(traded securities) are valued at current quoted market 

bid price for an asset. Quoted market prices are 

available for listed shares, options, debentures and 

other equity and debt securities. 




2. Summary of Significant Accounting Policies continued 

d. Fair value of financial assets and liabilities continued 

ii. 

Monetary financial assets and liabilities not traded in an 

organised financial market 

Financial assets and liabilities related to trade debtors, 

trade accounts payable, accruals and dividends payable 

are valued on a cost basis carrying amount (which 

approximates fair value). 

iii. Gold Bullion 

Gold bullion is valued at fair value current quoted 

market price. 

iv. Receivables 

Receivables are non-derivative financial assets with fixed 

or determinable payments that are not quoted in an 

active market and are subsequently measured at 

amortised cost. Receivables are included in current 

assets, except for those which are not expected to 

mature within 12 months following the end of the 

reporting period. 

v. Financial liabilities 

Non-derivative financial liabilities are subsequently 

measured at amortised cost and can include trade 

accounts payable and accrued expense provisions. 

e. Derivative financial instruments 

Only the VGT uses derivative financial instruments such as 

foreign currency contracts to hedge risks associated with 

foreign currency fluctuations. Such derivative financial 

instruments are stated at fair value. 

The fair value of forward contracts is calculated by 

reference to current forward exchange rates for contracts 

with similar maturity profiles. 

Gains and losses arising from changes in fair value are 

taken directly to the Statements of Comprehensive Income. 

f. Foreign currency transactions 

All foreign currency transactions during the year have been 

brought to account using the exchange rate in effect at the 

date of transaction. Foreign currency monetary items at 

balance date are translated at the exchange rate existing at 

that date. 

Gains and losses on amounts denominated in foreign 

currency (other than investments) are separately disclosed 

as foreign currency gains or losses in the Statements of 

Comprehensive Income in the year in which the exchange 

rates change. 

g. Distributions 

Distributions to Unitholders comprise the taxable income 

(including assessable capital gains) of each Fund. The 

distributions are payable at the end of each December and 

June each year. 

h. Goods and Services Tax 

Revenues, expenses and assets are recognised net of the 

amount of Goods and Services Tax (GST), except: 

i. where the amount of GST incurred is not recoverable 

from the taxation authority, the GST amount is 

recognised as part of the cost of acquisition of an asset 

or as an expense. 

ii. 

for receivables and payables, which are recognised 

inclusive of GST. 

The net amount of GST recoverable from, or payable to, 

the taxation authority is included as part of receivables or 

payables. 

Cash flows are included in the Statements of Cash Flows on 

a gross basis. The GST component of cash flows arising 

from investing and financing activities which is recoverable 

from or payable to the taxation authority is classified as 

cash flows from operating activities. 

i. Transfer to/from net assets attributable 

to unitholders 

Non-distributable income is retained as net assets 

attributable to unitholders and consists of unrealised 

changes in the fair value of investments, accrued income 

not yet assessable, expenses provided for or accrued which 

are not yet deductible, net capital losses and tax-free or 

tax-deferred income. 

j. Exit price 

The unit exit price is calculated in accordance with each 

Fund's Constitution and is determined by the value of the 

assets (based on a last sale valuation) of each Fund less its 

liabilities for estimated transaction costs, divided by the 

number of units on issue. 

k. Payables 

Trade payables and other accounts payable are recognised 

when each Fund becomes obliged to make future payments 

resulting from the purchase of securities. The amounts are 

unsecured and are usually paid within three days of 

recognition. 




l. Receivables 

Trade and other receivables may include amounts for 

dividends, interest and securities sold where settlement has 

not yet occurred. Amounts are generally received within 

three days of being recorded as receivables. Dividends are 

accrued when the right to receive payment is established. 

m. Applications and redemptions 

Applications received for units in each of the Funds are 

recorded net of any Entry Fees payable prior to the issue of 

units in each Fund. No Exit Fees are charged. Unit prices 

are determined by reference to the net assets of each Fund 

based on a last sale valuation divided by the number of 

units on issue at close of business each day. 

All or part of an investment can be switched between the 

Hunter Hall Funds. This facility is free of any Entry Fees for 

up to four switches per financial year; however, transaction 

costs will apply for the redemption and application 

components of each switch. Further details can be found in 

the Hunter Hall Funds Product Disclosure Statement (PDS). 

n. Rounding-off of amounts 

The Funds are of the kind referred to in ASIC Class Order 

98/0100, dated 10 July 1998 and in accordance with that 

Class Order amounts in the Directors' Report and the 

Financial Reports have been rounded to the nearest 

thousand dollars. 

o. Critical accounting estimates and 

judgements 

The Responsible Entity evaluates estimates and judgements 

incorporated into the Financial Report of each Fund based 

on historical knowledge and best available current 

information. Estimates assume a reasonable expectation of 

future events and are based on current trends and 

economic data, obtained both externally and internally. 

p. Adoption of new and revised 

accounting standards 

The accounting policies adopted are consistent with those 

of the previous financial year except as follows: 

i. AASB 101: Presentation of Financial Statements (revised 

2007) 

The revised Standard separates owner and non-owner 

changes in equity. The Statement of Changes in Equity 

includes only details of transactions with owners, with 

non-owner changes in equity presented in a 

ii. 

reconciliation of each component of equity and included 

in the new Statement of Comprehensive Income. The 

Statement of Comprehensive Income presents all items 

of recognised income and expense, either in one single 

statement, or in two linked statements. The Responsible 

Entity has elected to present one statement for the 

Funds. It should be noted that there was no income that 

fell into the category of ‘other comprehensive income’ 

for the year for any of the Funds. 

AASB 8: Operating Segments 

AASB 8: Operating Segments applies to annual reporting 

periods beginning on, or after, 1 January 2009. The 

standard applies to entities whose debt or equity 

instruments are traded in public market or those that file 

financial statements with a securities commission or 

other regulatory organisation for the purpose of issuing 

any class of financial instrument in a public market. 

Therefore AASB 8 does not apply to the Funds. 

iii. AASB 7: Financial Instruments: Disclosures 

The amended Standard requires additional disclosures 

about fair value measurement and liquidity risk. Fair 

value measurements related to all financial instruments 

recognised and measured at fair value are to be 

disclosed by source of inputs using a three level fair 

value hierarchy, by class. In addition, a reconciliation 

between the beginning and ending balance for level 3 

fair value measurements is now required, as well as 

significant transfers between levels in the fair value 

hierarchy. The amendments also clarify the 

requirements for liquidity risk disclosures with respect to 

derivative transactions and assets used for liquidity 

management. The fair value measurement disclosures 

are presented in Note 15. The liquidity risk disclosures 

are not significantly impacted by the amendments and 

are presented in Note 15. 

q. New accounting standards for 

application in future periods 

The AASB has issued new and amended accounting 

standards and interpretations that have mandatory 

application dates for future reporting periods. The Funds 

have decided against early adoption of these standards. A 

discussion of those future requirements and their impact on 

the Funds follows: 

i. AASB 9: Financial Instruments and AASB 2009–11: 

Amendments to Australian Accounting Standards arising 

from AASB 9 




2. Summary of Significant Accounting Policies continued 

q. New accounting standards for application in future 

periods continued 

These standards are applicable retrospectively and 

amend the classification and measurement of financial 

assets. The Responsible Entity has not yet determined 

the potential impact on the financial statements. The 

changes made to accounting requirements include: 

• simplifying the classifications of financial assets into 

those carried at amortised cost and those carried at 

fair value 

• simplifying the requirements for embedded 

derivatives 

• removing the tainting rules associated with held-tomaturity 

assets 

• removing the requirements to separate and fair 

value embedded derivatives for financial assets 

carried at amortised cost 

• allowing an irrevocable election on initial 

recognition to present gains and losses on 

investments in equity instruments that are not held 

for trading in other comprehensive income. 

Dividends in respect of these investments that are a 

return on investment can be recognised in profit or 

loss and there is no impairment or recycling on 

disposal of the instrument; and 

• reclassifying financial assets where there is a change 

in an entity’s business model as they are initially 

classified based on: 

a. the objective of the entity’s business model for 

managing the financial assets; and 

b. the characteristics of the contractual cash flows. 

ii. 

AASB 2009–4: Amendments to Australian Accounting 

Standards arising from the Annual Improvements Project 

[AASB 2 and AASB 138 and AASB Interpretations 9 & 16] 

(applicable for annual reporting periods commencing from 

1 July 2009) and AASB 2009-5: Further Amendments to 

Australian Accounting Standards arising from the Annual 

Improvements Project [AASB 5, 8, 101, 107, 117, 118, 136 

& 139] (applicable for annual reporting periods commencing 

from 1 January 2010). 

These standards detail numerous non-urgent but 

necessary changes to accounting standards arising from 

the IASB’s (International Accounting Standards Board) 

annual improvements project. No changes are expected 

to materially affect the Funds. 




3. Changes in Fair Value of Investments 

VGT GET AVT 


$’000 $’000 $’000 $’000 $’000 $’000 

Realised changes in fair value of 

investments 15,424 (227,804) (12,213) (92,650) 1,018 (10,332) 

Unrealised changes in fair value 

of investments 135,804 (81,558) 50,166 (12,021) 15,465 (14,308) 

151,228 (309,362) 37,953 (104,671) 16,483 (24,640) 

4. Distributions Paid and Payable 

VGT GET AVT 


$’000 $’000 $’000 $’000 $’000 $’000 

Dividend income 9,286 - - - 816 1,737 

Foreign income 13,404 - - - - - 

Australian income 40,506 - - - 119 331 

Tax-deferred income - - - 3,048 - 140 

Imputation credits (4,256) - - - (437) (850) 

Foreign tax credits (2,242) - - - - - 

56,698 - - 3,048 498 1,358 

Represented by: 

Distribution paid – December 29,111 - - 3,048 498 1,036 

Distribution paid and payable – June 27,587 - - - - 322 

56,698 - - 3,048 498 1,358 

¢/ unit ¢/ unit ¢/ unit ¢/ unit ¢/ unit ¢/ unit 

Dividend income 1.7709 - - - 1.2352 2.4920 

Foreign income 2.5541 - - - - 0.0002 

Australian income 7.7059 - - - 0.1794 0.4773 

Tax-deferred income - - - 0.7862 - 0.2119 

Imputation credits (0.8134) - - - (0.6617) (1.2259) 

Foreign tax credits (0.4280) - - - - - 

10.7895 - - 0.7862 0.7529 1.9555 

Represented by: 

Distribution paid – December 5.5458 - - 0.7862 0.7529 1.4691 

Distribution paid and payable – June 5.2437 - - - - 0.4864 

10.7895 - - 0.7862 0.7529 1.9555 




5. Expenses 

a. Management fees 

In accordance with each of the Funds’ Constitutions, the Responsible Entity is entitled to: 

VGT GET AVT 

Management fees Paid monthly 1.60% (1) 1.80% 1.80% of net asset value 

Performance fee (2) Payable 30 June Australian All MSCI World Total Australian All 15% of any outand 

31 December Ordinaries Return Index, Net Ordinaries performance of 

Accumulation Index Dividends Reinvested Accumulation Index applicable benchmark 

in Australian Dollars 

(1) Of which 0.1% is paid quarterly for the VGT. 

(2) The method of calculating the fee is detailed in the Constitutions and summarised in the current PDS. 

The amounts paid or payable to the Responsible Entity in accordance with each of the Funds’ Constitutions were: 

VGT GET AVT 


$’000 $’000 $’000 $’000 $’000 $’000 

Management fees 18,081 15,429 6,320 7,094 1,641 1,267 

Performance fees - - - - - - 

18,081 15,429 6,320 7,094 1,641 1,267 

b. Other expenses 

Printing, postage and Unitholder 

communication 275 418 58 93 23 55 

Accounting and administration costs 1,356 951 421 336 109 84 

Custody expenses 413 604 218 299 39 37 

Sundry expenses 803 677 331 355 133 73 

2,847 2,650 1,028 1,083 304 249 

c. Auditor’s remuneration 

Auditor’s remuneration expense has 

been included in Sundry expenses in 

Note 5b. 

Audit and review of the Financial Reports 36 35 36 35 36 35 

Other audit and assurance service 4 3 4 3 4 3 

d. Indirect Cost Ratio (ICR) related expenses 

40 38 40 38 40 38 

The ICR is a measure of the additional expenses incurred by Unitholders as a result of investing in each of the Funds. The 

majority of these expenses comprise fees paid to the Responsible Entity and the Custodian. Expenses that would otherwise 

be incurred by a direct investor, such as transaction costs, brokerage, government taxes and charges on purchases and sales, 

are excluded. 

The ICR of each of the Funds is calculated in accordance with the Government’s Enhanced Fee Disclosure measures 

(Corporations Amendment Regulations 2005), as shown in the following table. The table combines the expenses incurred 

directly by each of the Funds and those incurred indirectly through investments in other Managed Investment Schemes. 




VGT GET AVT 

ICR related expenses incurred 2010 2009 2010 2009 2010 2009 

by the Funds $’000 $’000 $’000 $’000 $’000 $’000 

Including performance fees 20,924 18,098 7,347 8,178 1,944 1,525 

Excluding performance fees 20,924 18,098 7,347 8,178 1,944 1,525 

ICR % % % % % % 

Including performance fees 1.85 1.88 2.09 2.07 2.13 2.17 

Excluding performance fees 1.85 1.88 2.09 2.07 2.13 2.17 

6. Cash Flow Information 

a. Reconciliation of cash and cash equivalents 

VGT GET AVT 


$’000 $’000 $’000 $’000 $’000 $’000 

Cash balance comprises: 

Cash at bank 151,412 179,509 50,466 86,215 17,499 16,680 

Total cash and cash equivalents 151,412 179,509 50,466 86,215 17,499 16,680 

b. Reconciliation of profit for the year to the net cash flows used in operating activities 

VGT GET AVT 


$’000 $’000 $’000 $’000 $’000 $’000 


to Unitholders 96,776 (300,123) 24,113 (113,920) 16,709 (24,756) 

Distribution to Unitholders 56,698 - - 3,048 498 1,358 

Realised (gains)/losses on sale of 

investments (15,424) 227,804 12,213 92,650 (1,018) 10,332 

Unrealised changes in market value (135,804) 81,558 (50,166) 12,021 (15,465) 14,308 

Realised foreign exchange movements 3,711 (530) 13,339 9,136 - 1 

Changes in assets and liabilities: 

(Increase)/decrease in current assets (988) 878 (444) 980 (180) 88 

Decrease/(increase) in current liabilities 107 (926) (3,998) (360) 17 (86) 

Net cash provided by/(used in) 

operating activities 5,076 8,661 (4,943) 3,555 561 1,245 

c. Non-cash financing and investment activities 

During the year distributions were reinvested by Unitholders for additional units in the Funds as shown in the following table: 

VGT GET AVT 


$’000 $’000 $’000 $’000 $’000 $’000 

Distribution reinvested 10,005 7,802 - 516 207 572 

10,005 7,802 - 516 207 572 




7. Investments 

VGT GET AVT 


$’000 $’000 $’000 $’000 $’000 $’000 

Financial instruments at fair value 914,636 730,041 249,404 251,311 63,199 51,174 

Foreign exchange forward contracts 

at fair value (9,629) 17,825 - - - - 

Gold Bullion at fair value 30,621 24,030 18,701 14,676 1,852 - 

935,628 771,896 268,105 265,987 65,051 51,174 

The following investments constitute 5% or more of the total value of investments of each of the Funds: 

Market Value 

Company Main business $ ‘000 

2010 

VGT 

Sirtex Medical Limited liver cancer treatments 59,522 

GET 

Woongjin Thinkbig Co Limited education services 19,679 

Gold gold 18,701 

Virgin Media Inc. broadband communications 16,057 

AVT 


M2 Telecommunications Group Limited telecommunications 5,462 

Decmil Group Limited engineering services 4,104 

Market Value 

Company Main business $ ‘000 

2009 

VGT 

There were no stocks 5% or more for the VGT 

GET 

Woongjin Thinkbig Co Ltd education services 19,545 

AVT 


RCR Tomlinson Ltd engineering services 3,518 

8. Trade and Other Receivables 

VGT GET AVT 


$’000 $’000 $’000 $’000 $’000 $’000 

Amounts owing on investments sold 5,957 239 1,867 109 - 7 

Goods and Services Tax recoverable 504 402 162 167 45 33 

Interest receivable 410 737 119 120 170 53 

Dividends accrued 2,899 1,686 1,000 662 53 1 

Sundry receivables - - 113 - - - 

9,770 3,064 3,261 1,058 268 94 




9. Trade and Other Payables 

VGT GET AVT 


$’000 $’000 $’000 $’000 $’000 $’000 

Payable to related parties: 

Payable to Responsible Entity 1,817 1,550 532 569 138 110 

Payable to Director related entities 

– administration fees 98 94 29 34 7 7 

Payable to other parties: 

Amounts owing on investments 

purchased 894 1,672 - 819 443 53 

Other payables 357 522 148 4,104 140 151 

3,166 3,838 709 5,526 728 321 

10. Distribution Payable 

VGT GET AVT 


$’000 $’000 $’000 $’000 $’000 $’000 

Distribution payable 27,587 - - - - 322 

27,587 - - - - 322 

11. Net Assets Attributable to Unitholders 

a. Movements in Unitholders’ funds during the year were as follows: 

VGT GET AVT 


$’000 $’000 $’000 $’000 $’000 $’000 

At beginning of the year 950,631 1,314,316 347,734 517,701 67,305 99,330 

Applications 156,678 97,673 43,306 48,911 13,746 8,302 

Redemptions (148,033) (169,037) (94,030) (105,474) (15,877) (16,143) 

Distribution reinvestment 10,005 7,802 - 516 207 572 

Net transfer from Statement of 

Comprehensive Income 96,776 (300,123) 24,113 (113,920) 16,709 (24,756) 

Net assets attributable to Unitholders 1,066,057 950,631 321,123 347,734 82,090 67,305 

b. Rights of Unitholders 

Ordinary units participate in distributions and the proceeds on winding up of the Fund, in proportion to the number of 

units held. 




12. Number of Issued Units 

VGT GET AVT 


’000 units ’000 units ’000 units ’000 units ’000 units ’000 units 

On issue at the beginning of the year 519,513 561,204 345,521 403,365 66,220 74,077 

Units issued during the year 73,001 52,846 40,708 45,298 9,886 7,939 

Units redeemed during the year (69,486) (97,843) (88,483) (103,671) (11,570) (16,364) 

Distribution reinvestment 4,492 3,306 - 529 167 568 

On issue at year-end 527,520 519,513 297,746 345,521 64,703 66,220 

13. Related Party Disclosures 

a. Hunter Hall Investment Management Limited 

Hunter Hall Investment Management Limited (ACN 063 081 612) as the Responsible Entity of each Fund provides accounting, 

treasury and investment services to each Fund in accordance with each Funds’ Constitution. Transactions with the Responsible 

Entity are undertaken on normal commercial terms and conditions. 

During the year the following amounts were paid and payable to the Responsible Entity in accordance with the Constitutions: 

VGT GET AVT 


$’000 $’000 $’000 $’000 $’000 $’000 

Management fees 18,081 15,429 6,320 7,094 1,641 1,267 


18,081 15,429 6,320 7,094 1,641 1,267 

The amounts payable at 30 June to the Responsible Entity, inclusive of GST but before input tax credits, in accordance with 

the Constitutions were: 

VGT GET AVT 


$’000 $’000 $’000 $’000 $’000 $’000 

Entry fees 15 5 1 1 - - 

Management fees 1,816 1,550 532 569 137 110 


b. Bennelong Administration Services Pty Ltd 

1,831 1,555 533 570 137 110 

Bennelong Administration Services Pty Ltd is a wholly owned subsidiary of Hunter Hall International Limited, the parent 

company of the Responsible Entity. Bennelong Administration Services Pty Ltd provides administration services to the 

Responsible Entity. 

During the year the following amounts were paid to Bennelong Administration Services Pty Ltd: 

VGT GET AVT 


$’000 $’000 $’000 $’000 $’000 $’000 

Administration fees 1,356 951 421 336 110 84 

1,356 951 421 336 110 84 




The amounts payable at 30 June to Bennelong Administration Services Pty Ltd, inclusive of GST but before input tax 

credits, were: 

VGT GET AVT 


$’000 $’000 $’000 $’000 $’000 $’000 

Administration fees 98 94 29 34 7 7 

98 94 29 34 7 7 

14. Geographical Exposure 

The Hunter Hall Equity Funds have investment exposures in different countries which are shown below. Each Fund invests 

in securities listed or to be listed on stock exchanges, unlisted securities and fixed interest securities. Details of the 

geographical exposures of investments were as follows: 

VGT 30 June 2010 30 June 2009 

Income and 

Income and 

gains/(losses) Market Portfolio gains/(losses) Market Portfolio 

on investments value share on investments value share 

$’000 $’000 % $’000 $’000 % 

Geographical exposure: 

Australia and New Zealand 76,010 342,655 31.5 (59,798) 284,178 29.8 

Other Americas 876 13,678 1.3 (8,486) 6,477 0.7 

Other Europe (15,531) 69,935 6.4 (81,618) 67,289 7.1 

United Kingdom 6,936 74,555 6.9 (16,040) 67,500 7.1 

Other Asia 550 17,950 1.7 (29,461) 46,042 4.8 

Japan 4,437 50,392 4.6 (164) 9,549 1.0 

Korea 9,700 92,776 8.5 (32,143) 104,073 10.9 

India 41,768 92,629 8.5 35,205 81,938 8.6 

USA 20,621 146,065 13.4 (18,284) 45,209 4.8 

Canada 1,179 44,622 4.1 (41,559) 41,816 4.4 

Foreign exchange hedge contracts 24,957 (9,629) (0.9) (42,335) 17,825 1.9 

Sub-total 171,503 935,628 86.0 (294,683) 771,896 81.1 

Cash 6,610 151,412 14.0 12,640 179,509 18.9 

Total 178,113 1,087,040 100.0 (282,043) 951,405 100.0 

As at 30 June 2010 56.3% (2009: 51.1%) of the VGT’s assets were held in foreign stocks and fixed interest. 




14. Geographical Exposure continued 

GET 30 June 2010 30 June 2009 

Income and 

Income and 



$’000 $’000 % $’000 $’000 % 


Australia and New Zealand 4,438 18,701 5.9 (3,263) 14,676 4.2 

Other Americas 343 8,190 2.6 (3,948) 5,256 1.5 

Other Europe (5,716) 37,067 11.6 (38,345) 45,998 13.1 

United Kingdom 3,386 30,524 9.6 (8,807) 30,640 8.7 

Other Asia (893) 5,420 1.7 4,055 56,749 16.1 

Japan 5,231 35,343 11.1 2,332 22,695 6.4 

Korea 4,003 32,228 10.1 (13,196) 42,257 12.0 

India 15,628 30,069 9.4 - - 0.0 

USA 8,074 52,461 16.4 (8,235) 30,963 8.8 

Canada 1,344 18,102 5.7 (22,981) 16,753 4.7 

Sub-total 35,838 268,105 84.1 (92,388) 265,987 75.5 

Cash 8,962 50,466 15.9 (1,171) 86,215 24.5 

Total 44,800 318,571 100.0 (93,559) 352,202 100.0 

As at 30 June 2010 78.3% (2009: 71.3%) of the GET’s assets were held in foreign stocks. 

AVT 30 June 2010 30 June 2009 

Income and 

Income and 



$’000 $’000 % $’000 $’000 % 


Australia 18,510 65,051 78.8 (20,032) 50,396 74.2 

New Zealand (18) - 0.0 (2,497) 778 1.2 

Sub-total 18,492 65,051 78.8 (22,529) 51,174 75.4 

Cash 660 17,499 21.2 648 16,680 24.6 

Total 19,152 82,550 100.0 (21,881) 67,854 100.0 

As at 30 June 2010 nil (2009: 1.2%) of the AVT’s assets were held in foreign stocks. 

15. Financial Risk Management 

Each Fund’s financial instruments consist mainly of deposits with banks, investments, accounts receivable and payable. The 

Constitution of the VGT allows it to use derivatives, such as forward exchange contracts, for economic hedging purposes. 

The VGT does not speculate in the trading of derivative instruments. 

The capital structure of the Funds consists of cash and cash equivalents and the proceeds from the issue of the units of the 

Funds. The Responsible Entity aims to ensure that there is sufficient capital for possible redemptions by Unitholders by 

maintaining a minimum of 5% of total investments in cash and cash equivalents for each Fund. The Funds have no 

restrictions on specific capital requirements on the application and redemption of units. Each Fund’s overall investment 

strategy remains unchanged from the prior year. 




Financial instruments held by each of the Funds: 

VGT GET AVT 


Financial assets $’000 $’000 $’000 $’000 $’000 $’000 

Cash and cash equivalents 151,412 179,509 50,466 86,215 17,499 16,680 

Investments at fair value 935,628 771,896 268,105 265,987 65,051 51,174 

Trade and other receivables 9,770 3,064 3,261 1,058 268 94 

1,096,810 954,469 321,832 353,260 82,818 67,948 

Financial liabilities 

Trade and other payables 3,166 3,838 709 5,526 728 321 

3,166 3,838 709 5,526 728 321 

a. Market risk 

i. Foreign exchange risk 

With approximately 56.3% (2009: 51.1%) of the VGT’s assets held in foreign stocks there is a risk associated with movements 

in foreign exchange. The Responsible Entity has adopted a policy to hedge against exchange rate movements through short 

term forward contracts. See Note 15f. below for further details on the derivative financial instruments used by the VGT for 

hedging foreign exchange risk. 

With 78.3% (2009: 71.3%) of the GET’s assets and nil (2009: 1.2%) of the AVT’s assets held in foreign stocks there is a risk 

associated with movements in foreign exchange rates. The AVT and GET do not hedge exposure to foreign exchange risk. 

The total net exposure to fluctuations in foreign currency exchange rates were as follows: 

VGT 2010 

Unsettled 

Cash Investments Forwards trades Other Total 


Australian Dollar 109,375 331,662 - 135 959 442,131 

Brazilian Real - 13,678 - - - 13,678 

Canadian Dollar 98 44,622 - - 308 45,028 

Euro 2,760 48,353 1,098 - 67 52,278 

British Pound - 74,555 - - 88 74,643 

Hong Kong Dollar - 4,449 - - - 4,449 

Japanese Yen 3,951 50,392 - - 4 54,347 

New Zealand Dollar - 9,812 - - - 9,812 

Norwegian Kroner 2,270 10,225 54 601 - 13,150 

Singapore Dollar - 5,862 - - - 5,862 

Korean Won 1 92,776 - - - 92,777 

Swedish Kroner - 5,479 - - - 5,479 

Swiss Franc 4,712 5,878 - - - 10,590 

Taiwanese Dollar 461 1,312 - - - 1,773 

Thailand Baht - 3,175 - - - 3,175 

United States Dollar 27,784 243,028 - 5,221 2,387 278,420 

151,412 945,258 1,152 5,957 3,813 1,107,592 




15. Financial Risk Management continued 

a. Market risk continued 

VGT 2010 

Unsettled 


Financial lia bilities $’000 $’000 $’000 $’000 $’000 $’000 

Australian Dollar - - - 376 2,270 2,646 

Canadian Dollar - - 695 - - 695 

Danish Kroner - - - - 1 1 

British Pound - - 3,243 - - 3,243 

Indian Rupee - - 247 - - 247 

Japanese Yen - - 2,923 - - 2,923 

Norwegian Kroner - - - - 1 1 

Korean Won - - 1,214 - - 1,214 

Swiss Franc - - 100 267 - 367 

United States Dollar - - 2,360 251 - 2,611 

- - 10,782 894 2,272 13,948 

VGT 2009 

Unsettled 



Australian Dollar 178,685 271,347 - - 1,120 451,152 

Brazilian Real - 6,477 - - 185 6,662 

Canadian Dollar - 41,816 1,427 - - 43,243 

Euro - 44,425 1,687 63 7 46,182 

British Pound 1 52,094 656 - 53 52,804 

Hong Kong Dollar - 26,254 824 - - 27,078 

Indian Rupee - - 3,881 - - 3,881 

Japanese Yen 340 9,549 593 - - 10,482 

Malaysian Ringitt 1 - - - - 1 

New Zealand Dollar - 16,160 - - - 16,160 

Norwegian Kroner - 22,864 1,734 - - 24,598 

Singapore Dollar 80 12,011 613 176 - 12,880 

Korean Won - 104,072 2,315 - - 106,387 

Swedish Kroner 1 - 4 - - 5 

United States Dollar 401 147,001 4,092 - 1,460 152,954 

179,509 754,070 17,826 239 2,825 954,469 


Australian Dollar - - - 818 2,163 2,981 

Danish Kroner - - - - 1 1 

Norwegian Kroner - - - - 2 2 

United States Dollar - - - 854 - 854 

- - - 1,672 2,166 3,838 




GET 2010 

Unsettled 



Australian Dollar 12,245 18,701 - - 309 31,255 

Brazilian Real - 8,190 - - - 8,190 

Canadian Dollar - 18,102 - - 133 18,235 

Euro 2,519 25,108 - - 26 27,653 

British Pound 1 30,524 - - 34 30,559 

Hong Kong Dollar - 1,309 - - - 1,309 

Japanese Yen 4,944 34,847 - - 7 39,798 

Norwegian Kroner 1,851 5,276 - 256 - 7,383 

Singapore Dollar 1 2,367 - - - 2,368 

Korean Won - 32,228 - 86 - 32,314 

Swedish Kroner - 3,932 - - - 3,932 

Swiss Franc 3,384 2,751 - - - 6,135 

Taiwanese Dollar 354 384 - - - 738 

Thailand Baht - 181 - - - 181 

United States Dollar 25,167 84,205 - 1,525 885 111,782 

50,466 268,105 - 1,867 1,394 321,832 


Australian Dollar - - - - 708 708 

British Pound - - - - 1 1 

- - - - 709 709 

GET 2009 

Unsettled 



Australian Dollar 18,933 18,880 - - 207 38,020 

Brazilian Real - 5,256 - - 82 5,338 

Canadian Dollar - 16,753 - - - 16,753 

Euro 15,662 35,005 - 25 - 50,692 

British Pound - 22,962 - - 21 22,983 

Hong Kong Dollar - 12,422 - - - 12,422 

Japanese Yen 4,764 22,695 - - 5 27,464 

Malaysian Ringitt 1 - - - - 1 

Norwegian Kroner - 10,993 - - - 10,993 

Singapore Dollar 37 6,839 - 84 - 6,960 

Korean Won - 42,257 - - - 42,257 

United States Dollar 46,818 71,925 - - 634 119,377 

86,215 265,987 - 109 949 353,260 


Australian Dollar - - - - 4,707 4,707 

Euro - - - 478 - 478 

United States Dollar - - - 341 - 341 

- - - 819 4,707 5,526 






AVT 2010 

Unsettled 




New Zealand Dollar 6 - - - - 6 


17,499 65,051 - - 268 82,818 

Australian Dollar - - - 443 285 728 

- - - 443 285 728 

AVT 2009 

Unsettled 




New Zealand Dollar 6 778 - 7 - 791 

16,680 51,174 - 7 87 67,948 


Australian Dollar - - - 53 268 321 

- - - 53 268 321 

Sensitivity analysis 

A 10% strengthening of the Australian Dollar against the following currencies at balance date would have decreased the net 

assets attributable to unitholders and profit or loss from operating activities by the amounts shown. The analysis assumes 

that all other variables, in particular interest rates, remain constant. 

VGT GET AVT 



Brazilian Real (1,368) (629) (819) (518) - - 

Canadian Dollar (2,717) (1,378) (1,823) (1,675) - - 

Euro (1,367) (1,464) (2,765) (5,064) - - 

British Pound 1,335 (1,509) (3,056) (2,294) - - 

Hong Kong Dollar (445) (850) (131) (1,242) - - 

Indian Rupee 1,911 4,632 - - - - 

Japanese Yen (3,264) (342) (3,980) (2,746) - - 

New Zealand Dollar (981) (1,616) - - (1) (78) 

Norwegian Kroner (762) (642) (738) (1,099) - - 

Singapore Dollar (586) (521) (237) (688) - - 

Korean Won (9,278) (2,723) (3,231) (4,226) - - 

Swedish Kroner (548) - (393) - - - 

Swiss Franc (789) - (614) - - - 

Taiwanese Dollar (177) - (74) - - - 

Thailand Baht (317) - (18) - - - 

United States Dollar (20,415) (9,858) (11,178) (11,826) - - 

(39,768) (16,900) (29,057) (31,378) (1) (78) 




A 10% weakening of the Australian Dollar against the following currencies at balance date would have increased the net 

assets attributable to unitholders and profit or loss from operating activities by the amounts shown. The analysis assumes 

that all other variables, in particular interest rates, remain constant. 

VGT GET AVT 



Brazilian Real 1,368 629 819 518 - - 

Canadian Dollar 2,717 1,378 1,823 1,675 - - 

Euro 1,367 1,464 2,765 5,064 - - 

British Pound (1,335) 1,509 3,056 2,294 - - 

Hong Kong Dollar 445 850 131 1,242 - - 

Indian Rupee (1,911) (4,632) - - - - 

Japanese Yen 3,264 342 3,980 2,746 - - 

New Zealand Dollar 981 1,616 - - 1 78 

Norwegian Kroner 762 642 738 1,099 - - 

Singapore Dollar 586 521 237 688 - - 

Korean Won 9,278 2,723 3,231 4,226 - - 

Swedish Kroner 548 - 393 - - - 

Swiss Franc 789 - 614 - - - 

Taiwanese Dollar 177 - 74 - - - 

Thailand Baht 317 - 18 - - - 

United States Dollar 20,415 9,858 11,178 11,826 - - 

39,768 16,900 29,057 31,378 1 78 

ii. Price risk 

Each of the Funds is exposed to equity securities price risk. This arises from investments held by each of the Funds and 

classified on the Statement of Financial Position as fair value through profit or loss. 

To manage price risk arising from investments in equity securities, each of the Funds diversifies its portfolio. The majority of 

each of the Fund’s equity investments are publicly traded. 


At balance date, if the equity prices had been 10% higher or lower, the effect on the net profit of each of the Funds would 

have been as follows: 

VGT GET AVT 



Equity prices 10% higher 94,526 75,404 26,810 26,596 6,505 5,117 

Equity prices 10% lower (94,526) (75,404) (26,810) (26,596) (6,505) (5,117) 

iii. Interest rate risk 

The majority of each Fund’s financial assets are non-interest bearing. The main interest rate risk for each Fund arises from 

its cash holdings. Each Fund’s exposure to interest rate risk, which is the risk that a financial instrument’s value will fluctuate 

as a result of changes in market interest rates and the effective weighted average interest rates on classes of financial assets 

and financial liabilities are as follows: 







Weighted average Floating interest Weighted average Floating interest 

effective interest rate rate effective interest rate rate 

VGT % ’000 % ’000 

Cash and cash equivalents 3.15 151,412 3.18 179,509 

GET 


AVT 



VGT GET AVT 



Interest rates 10% higher 38 71 3 4 17 5 

Interest rates 10% lower (38) (71) (3) (4) (17) (5) 

b. Credit risk 

Credit risk arises from cash and cash equivalents, derivative financial instruments and deposits with banks and financial 

institutions, as well as outstanding receivables. Each Fund minimises concentrations of credit risk by undertaking 

transactions with a number of customers and counter parties on recognised and reputable exchanges. Each Fund is not 

materially exposed to any individual counter party. 

The maximum exposure to credit risk, excluding the value of any collateral or other security, at balance date in respect of 

recognised financial assets is the carrying amount, net of any provisions for doubtful debts of those assets, as disclosed in the 

Statement of Financial Position and Notes to the Financial Statements. 

c. Liquidity risk 

The liquidity risks associated with the need to satisy Unitholders’ requests for redemptions are mitigated by maintaining a 

constant pool of cash to satisfy usual levels of demand. The investment portfolio of each Fund is much less diversified than 

many Managed Investment Schemes, in general holding no more than 100 securities. In addition, the largest holdings in 

the portfolio have a high relative portfolio weighting and may be relatively illiquid. This means each of the Funds are much 

more sensitive to movements in liquidity risk than most other Funds. 

Maturities of financial liabilities 

Financial liabilities held by the Funds include management fees payable to the Responsible Entity, unsettled trades and 

other sundry accruals. The below table shows the maturities of financial liabilities held by the Funds. In addition, the VGT 

holds short term forward contracts which are also included below where any liability existed at balance date. Further 

information on these instruments is in Note 15f. below. 

VGT 2010 Less than 1 to 3 3 to 6 6 to 12 1 to 5 

1 month months months months years Total 

Financial liabilities $’000 $’000 $’000 $’000 $’000 $’000 

Due to brokers 894 - - - - 894 

Derivative financial instruments 762 1,557 7,981 482 - 10,782 

Trade and other payables 2,272 - - - - 2,272 

Total 3,928 1,557 7,981 482 - 13,948 




VGT 2009 

Due to brokers 1,672 - - - - 1,672 


Total 3,838 - - - - 3,838 

GET 2010 Less than 1 to 3 3 to 6 6 to 12 1 to 5 



Trade and other payables 709 - - - - 709 

Total 709 - - - - 709 

GET 2009 

Due to brokers 819 - - - - 819 


Total 5,526 - - - - 5,526 

AVT 2010 Less than 1 to 3 3 to 6 6 to 12 1 to 5 



Due to brokers 443 - - - - 443 


Total 728 - - - - 728 

AVT 2009 

Due to brokers 53 - - - - 53 


Total 321 - - - - 321 

d. Net fair value of financial assets and liabilities 

Each Fund’s financial assets and liabilities included in the Statement of Financial Position are carried at amounts that are 

considered to approximate their net fair value. 

The following table provides an analysis of financial instruments as at balance date that are measured subsequent to initial 

recognition at fair value, grouped into Levels 1 to 3 based on the degree to which fair value is observable. 

• Level 1 fair value measurements are those derived from quoted prices (unadjusted) in active markets for identical assets 

and liabilities 

• Level 2 fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are 

observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices) 

• Level 3 fair value measurement are those derived from valuation techniques that include inputs for the asset or liability 

that are not based on observable market data (unobservable inputs) 

VGT 2010 Level 1 Level 2 Level 3 Total 

Financial assets at fair value through profit or loss $’000 $’000 $’000 $’000 

Foreign currency forward contracts - 1,152 - 1,152 

Listed investments at fair value 911,889 1,181 - 913,070 

Unlisted investments at fair value 30,622 1,566 - 32,188 

Total 942,511 3,899 - 946,410 

Financial liabilities at fair value through profit or loss $’000 $’000 $’000 $’000 

Derivative financial liabilities - 10,782 - 10,782 

Total - 10,782 - 10,782 





d. Net fair value of financial assets and liabilities continued 

GET 2010 Level 1 Level 2 Level 3 Total 


Listed investments at fair value 248,241 - - 248,241 

Unlisted investments at fair value 18,701 1,163 - 19,864 

Total 266,942 1,163 - 268,105 

AVT 2010 Level 1 Level 2 Level 3 Total 


Listed investments at fair value 63,199 - - 63,199 

Unlisted investments at fair value 1,852 - - 1,852 

Total 65,051 - - 65,051 

e. Treasury risk management 

Senior Executives of the Responsible Entity meet on a regular basis to analyse currency and interest rate exposure and to 

evaluate treasury management strategies in the context of the most recent economic conditions and forecasts. 

f. Derivative financial instruments 

A derivative is a financial contract, the value of which depends on, or is derived from the value of underlying assets, 

liabilities or indices. Derivative transactions include a wide assortment of instruments, such as forwards, futures, options 

and swaps. Derivatives are considered to be part of the investment process. Transactions for hedging purposes are 

undertaken without the use of collateral as only reputable institutions with sound financial positions are dealt with. The 

use of derivatives is an essential part of the VGT’s portfolio management. In particular the VGT uses short term forward 

contracts to manage the risk associated with movements in foreign exchange rates. 

The Responsible Entity, as Manager, has adopted a policy to hedge against foreign exchange rate movements through 

short term forward contracts. The accounting policy in regard to foreign exchange contracts is detailed in Note 1e. 

During the year this resulted in a realised gain of $52,411,909 (2009: loss of $17,433,515). At balance date, details of 

outstanding foreign exchange contracts were: 

VGT Buy Australian Dollars Average exchange rate 

2010 2009 2010 2009 

Sell $’000 $’000 $ $ 

Canadian Dollar 17,860 28,040 0.8964 0.9272 

Euro 37,509 29,793 0.6811 0.5706 

British Pound 87,996 36,953 0.5572 0.4871 

Hong Kong Dollar - 17,754 - 6.1956 

Indian Rupee 19,111 46,323 39.3525 38.8580 

Japanese Yen 21,704 6,464 73.9854 77.3536 

South Korean Won - 76,846 1,028.8714 1,015.0168 

Norwegian Kroner 5,472 16,445 5.4826 5.1686 

Singapore Dollar - 6,885 - 1.0670 

United States Dollar 74,017 47,411 0.8356 0.8015 

30 Hunter Hall Equity Funds Annual Report 2010



16. Key Management Personnel Compensation 

a. Names and positions held of Directors and Specified Executives of the 

Responsible Entity in office at any time during the financial year are: 

Directors: 

William Wayne Hawkins Non-executive Chairman (appointed effective 1 July 2009) 

Peter James Macdonald Hall Executive Chairman (resigned effective 1 July 2009) 



Jack Theseus Lowenstein Executive Director (resigned effective 2 June 2010) 

Richard Hazen Taylor Non-executive Director (resigned effective 29 April 2010) 

Mark Benedict Forstmann Non-executive Director (appointed effective 1 July 2009) 

Suzanne Mary Daniel Non-executive Director (from 5 May to 30 May 2010) 

Specified Executives: 

Ouafaa Karim 

Paula Ferrao 

James Hordern 

Company Secretary 

Chief Financial Officer 

Manager, Business Development and Marketing 

Directors of the Responsible Entity are also Directors or Executives of its parent company, Hunter Hall International 

Limited (HHL), and their services to Hunter Hall Investment Management Limited form part of an investment 

management agreement for the provision of services by HHL to the Responsible Entity. As such no Directors are paid 

directly from Hunter Hall Investment Management Limited. 

The Responsible Entity does not remunerate any of its Board members and Senior Executives; remuneration is paid by the 

parent Company, Hunter Hall International Limited. 

For details on remuneration of Directors and Specified Executives refer to the Hunter Hall International Limited Annual 

Report for the year to 30 June 2010. 

b. Transactions 

Directors of the Responsible Entity who held units in the VGT are detailed below: 

Units held as at 


1 July 2009 Units sold Units reinvested Units purchased 30 June 2010 

Jack Theseus Lowenstein 10,767 - - - 10,767 

Directors of the Responsible Entity who held units in the GET are detailed below: 



1 July 2009 Units sold Units reinvested Units purchased 30 June 2010 

Jack Theseus Lowenstein 188,875 - - - 188,875 

No units in the AVT were held by the Responsible Entity or by Directors and their respective related parties. 

17. Subsequent Events 

There were no subsequent events to year-end that require disclosure other than those matters referred to elsewhere in this 

report. 

The Financial Report was authorised for issue on 2 September 2010 by the Board of Directors. 

18. Contingencies 

There were no contingent liabilities or contingent assets at 30 June 2010 or at 30 June 2009. 


Directors’ Declaration 

In the opinion of the Directors of the Responsible Entity: 

1. The Financial Statements and Notes set out on pages 7 to 31, are in accordance with the Corporations Act 2001, including: 

a) complying with Australian Accounting Standards (including the Australian Accounting Interpretations), and 

Corporations Regulations 2001; 

b) giving a true and fair view of the financial position of each of the Funds as at 30 June 2010 and of their performance 

for the year, as represented by the results of their operations and cash flows, for the financial year ended on that date; 

2. The Financial Reports also comply with the International Financial Reporting Standards as disclosed in Note 1; and 

3. There are reasonable grounds to believe that each of the Funds will be able to pay their debts as and when they become 

due and payable. 

Signed in accordance with a resolution of the Directors of the Responsible Entity made pursuant to s.295(5) of the 

Corporations Act 2001. 

On behalf of the Directors 



Sydney 

2 September 2010 



ABN 25 034 787 757 


Sydney NSW 2000 

PO Locked Bag Q800 

QVB Post Office 

Sydney NSW 1230 

T +61 2 8297 2400 

F +61 2 9299 4445 

E info.nsw@au.gt.com 

W www.grantthornton.com.au 

Auditor’s Independence Declaration 

To the Directors of Hunter Hall Investment Management Limited 

In accordance with the requirements of section 307C of the Corporations Act 2001, as lead auditor for the audits of 

Hunter Hall Australian Value Trust, Hunter Hall Global Ethical Trust and Hunter Hall Value Growth Trust for the year 

ended 30 June 2010, I declare that, to the best of my knowledge and belief, there have been: 

a 

no contraventions of the auditor independence requirements of the Corporations Act 2001 in relation to the 

audit; and 

b no contraventions of any applicable code of professional conduct in relation to the audit. 

GRANT THORNTON NSW 

Chartered Accountants 

G S Layland 

Partner 

Sydney, 2 September 2010 

Grant Thornton Australia Limited is a member firm within Grant Thornton International Ltd. Grant Thornton International Ltd and the member firms are not a worldwide partnership. Grant Thornton Australia Limited, 

together with its subsidiaries and related entities, delivers its services independently in Australia. 

Liability limited by a scheme approved under Professional Standards legislation. 



ABN 25 034 787 757 


Sydney NSW 2000 

PO Locked Bag Q800 

QVB Post Office 

Sydney NSW 1230 

T +61 2 8297 2400 

F +61 2 9299 4445 

E info.nsw@au.gt.com 

W www.grantthornton.com.au 

Independent Auditor’s Report 

To the Unitholders of the Hunter Hall Equity Funds 

We have audited the accompanying financial reports of Hunter Hall Australian Value Trust, Hunter Hall Global Ethical 

Trust and Hunter Hall Value Growth Trust (together “the Hunter Hall Trusts” or “the Funds”), which comprises the 

statements of financial position as at 30 June 2010, and the statements of comprehensive income, statements of 

changes in equity and statements of cash flows for the year then ended, notes comprising a summary of significant 

accounting policies and other explanatory information, and the directors’ declaration. 

Directors’ responsibility for the financial reports 

The directors of the responsible entity are responsible for the preparation of the financial reports that give a true and 

fair view in accordance with Australian Accounting Standards (including the Australian Accounting Interpretations) and 

the Corporations Act 2001 and for such internal control as the directors determine is necessary to enable the 

preparation of the financial report that is free from material misstatement, whether due to fraud or error. In Note 1 the 

directors also state, in accordance with Accounting Standard AASB 101 Presentation of Financial Statements, that that 

compliance with the Australian equivalents to International Financial Reporting Standards ensures that the financial 

report, comprising the financial statements and notes, complies with International Financial Reporting Standards. 

Grant Thornton Australia Limited is a member firm within Grant Thornton International Ltd. Grant Thornton International Ltd and the member firms are not a worldwide partnership. Grant Thornton Australia Limited, 

together with its subsidiaries and related entities, delivers its services independently in Australia. 

Liability limited by a scheme approved under Professional Standards legislation. 


Auditor’s responsibility 

Our responsibility is to express an opinion on the financial reports based on our audit. We conducted our audit in 

accordance with Australian Auditing Standards. Those standards require that we comply with relevant ethical 

requirements relating to audit engagements and plan and perform the audit to obtain reasonable assurance about 

whether the financial report is free from material misstatement. 

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial 

statements. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of 

material misstatement of the financial statements, whether due to fraud or error. 

In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair 

presentation of the financial report 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 entity’s internal control. An audit also includes 

evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the 

directors, as well as evaluating the overall presentation of the financial report. 

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit 

opinion. 

Independence 

In conducting our audit, we have complied with the independence requirements of the Corporations Act 2001. 


Auditor’s opinion 

In our opinion: 

a 

the financial reports of Hunter Hall Australian Value Trust, Hunter Hall Global Ethical Trust and Hunter Hall 

Value Growth Trust are in accordance with the Corporations Act 2001, including: 

i 

ii 

giving a true and fair view of each fund’s financial position as at 30 June 2010 and of its performance for 

the year ended on that date; and 

complying with Australian Accounting Standards (including the Australian Accounting Interpretations) the 

Corporations Regulations 2001. 

b the financial reports also comply with International Financial Reporting Standards as disclosed in Note 1. 

GRANT THORNTON NSW 

Chartered Accountants 

G S Layland 

Partner 

Sydney, 2 September 2010 


Directory 



ARSN 093 079 906 



ARSN 098 586 282 



ARSN 098 586 586 

Custodian 

BNP Paribas Fund Services Australasia Pty Ltd 

ABN 71 002 655 674 

BNP Paribas Centre 



Auditor 




Responsible Entity 


ABN 69 063 081 612 

ACN 063 081 612 

AFSL 219462 

Registered Office 



Telephone: +61 2 8224 0300 

Facsimile: +61 2 8224 0333 

London Research Office 

Level 4, 53 Frith Street 

London W1D 4SN UK 

Telephone: +44 207 734 4044 

Facsimile: +44 207 734 4045 

Investor Relations 

You can obtain information about investing in the Hunter 

Hall Funds including the latest unit price via: 

• internet: www.hunterhall.com.au 

• telephone: 1800 651 674 

0800 448 305 (New Zealand callers) 

+ 612 8224 0300 (international callers) 

• email: invest@hunterhall.com.au 

Address for Applications and Redemptions 


Reply Paid 3955 

Sydney NSW 2001 Australia

HUNTER 

HALL 

Ethical 

Managed Funds 


Investor Relations 1800 651 674 

www.hunterhall.com.au

Annual Report 30 June 2010 - Hunter Hall Investment Management

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