Islamic Asset Allocation Fund

Financial Statements for the period ended June 30, 2016

Islamic Asset Allocation Fund

Faysal Islamic Asset Allocation FundThe Faysal Islamic Asset Allocation Fund (FIAAF) is an open-ended shariah compliant mutual fund. FIAAF seeks to provide long-term capital appreciation optimizing through broad mix of asset classes encompassing shariah compliant equity, fixed income and money market instruments.

Review Report to the Unit Holders on the Statment of Compliance withthe best practices of the code of corporate governance

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EY Ford Rhodes, Chartered Accountants

Faysal Bank Limited - Islamic BankingBank Islami Pakistan LimitedMeezan Bank LimitedBurj Bank LimitedDubai Islamic Bank Limited

Faysal Asset Management Faysal Islamic Asset Allocation Fund04

Faysal Asset Management Limited

Mr. Nauman Ansari, ChairmanMr. Razi-Ur-Rahman Khan, DirectorMr. Osman Khan, DirectorSyed Ibad-Ur-Rehman Chishti, DirectorMr. Mohammad Zahid Ahmed, DirectorMr. Farooq Hadi, DirectorMr. Enamullah Khan, Chief Executive Officer

Mr. Umairullah Khan

Mr. Razi-Ur-Rahman Khan, ChairmanSyed Ibad-ur-Rehman Chisti, MemberMr. Osman Khan, Member

Central Depository Company of Pakistan Limited,

Chief Financial Officerand Company Secretary of theManagement Company

Mr. Osman Khan, ChairmanMr. Razi-Ur-Rahman Khan, MemberSyed Ibad-Ur-Rehman Chishti, MemberMr. Enamullah Khan, Member

HR Comittee

Faysal Asset Management Faysal Islamic Asset Allocation Fund 05

The Faysal Islamic Asset Allocation Fund endeavours to provide investors with an opportunity to earn long-term capital appreciation optimizing through broad mix of asset classes encompassing shariah compliant equity, fixed income & money market instruments.

The Directors of the Faysal Asset Management Limited, the Management Company of Faysal Islamic Asset Allocation Fund (FIAAF), are pleased to present the Annual Report on the operations of FIAAF along with the audited accounts, Reports of the Trustee and Auditors to the Unit Holders for the period ended June 30, 2016. The Fund was launched on September 09, 2015.

SALE AND REDEMPTION OF UNITS

During the period, units worth Rupees 460.378 million were issued and units with a value of Rupees 257.365 million were redeemed.

UNIT HOLDERS

As of June 30, 2016, 2,006,745 units with a value of Rs. 192.603 million were outstanding.

UNIT PRICES

Unit prices are being announced on a daily basis based on the NAV of the underlying portfolio. The highest and lowest offer/redemption prices during the period as well as the prices prevailing as of June 30, 2016 were as below:

Offer Price Redemption Price Highest 106.69 104.59 Lowest 88.72 86.98 As of June 30, 2016 97.90 95.98

ECONOMIC OUTLOOK

Pakistan’s economy underwent substantial progress during the course of fiscal year 2016. Almost all the critical macroeconomic indicators exhibited continuous progress which alleviated the GDP growth to reach 8-year high of 4.7%. The industrial sector activities made significant strides on the back of better energy supply and improved law and order situation. Despite the challenges on external front in the form of declining exports amid deteriorating global growth prospects and heavy agricultural losses, economic recovery process remained on track.

The average inflation during FY16 declined to 47-year low of 2.86% against 4.53% in the same period last year. Such historical lows were achieved on the back of falling commodity prices and contained food inflation along with help from prudent monetary and fiscal policies. The ‘Perishable Food Items’ and ‘Transport’ heads registered year-on-year negative readings at -1.82% and -5.18% respectively. Likewise, all the other CPI basket items remained benign throughout the year.

International reserve buffers held by State Bank of Pakistan (SBP) were effectively rebuilt during the year. By the year end, foreign exchange reserves reached to USD 18.1 billion, sufficient to finance four months of imports. Muted global oil prices, steady remittances growth, improved Foreign Direct Investments (FDI) and FX borrowing played the much needed role in consolidation of the foreign exchange reserves.

According to the figures of State Bank of Pakistan (SBP), current account deficit (CAD) for the fiscal year 2016 contracted by 6.8% to USD 2.5 billion as compared to USD 2.7 billion in the same period last year. Workers’ remittances, despite looming concerns of slowdown in Gulf region, remained upbeat clocking in at USD 19.9 billion (up 6.4% year-on-year) as compared to USD 18.7 billion during the last fiscal year. The current account deficit was further alleviated with an impressive surge of 39% in Foreign Direct Investments (FDI) which clocked in at USD 1.3 billon as compared to USD 0.9 billion last year. This improvement came mainly on account of investment inflows coming from the China-Pakistan Economic Corridor (CPEC) project.

Export, on the other hand, underwent decline of 8.6% on the back of global meltdown and low commodity prices. Nevertheless, imports bill was reduced by mere 2% owing to substantial increase in non-oil imports (up 79% to USD 31.8 billion). Accordingly, balance of payments position clocked in at USD -2.6 billion, declining by mere 0.3% as compared to the last year. CAD as % of GDP clocked in at -0.9% as compared to -0.17% during the last fiscal year.

According to Pakistan Bureau of Statistics (PBS), overall Large Scale Manufacturing (LSM) sector has exhibited growth of 3.45% during July-May 2015-16 when compared with the same period of last year. Major industries driving the growth were a) automobiles (up 18%), b) fertilizers (up 15%), c) nonmetallic mineral products (up 11%), d) leather products (up 9%), e) chemicals (up 9%), f) rubber products (up 7%) and g) pharmaceuticals (up 6%).

During the year, broad-based improvements in underlying economic indicators facilitated the State Bank of Pakistan (SBP) to cut its policy rate by a cumulative 75bps in FY16; over and above cut of 300bps in FY15. Going forward, GDP growth is anticipated to remain buoyant on the back of construction and development activities under China Pakistan Economic Corridor (CPEC) and strengthened private sector credit growth. Nonetheless, risks pertaining to challenging global environment and its looming impact on exports and remittances growth could be very critical and may undermine the growth prospects.


REPORT OF THE DIRECTORS OF THE MANAGEMENT COMPANY


REPORT OF THE DIRECTORS OF THE MANAGEMENT COMPANY

INCOME DISTRIBUTION

The Board of directors has not approved Fund distribution considering the loss for the period ended June 30, 2016.

MUTUAL FUND RATING

Pakistan Credit Rating Agency (PACRA) has not assigned ranking to Faysal Islamic Asset Allocation as of June 30, 2016.

CORPORATE GOVERNANCE

A prescribed under clause 5.19.23 of the Listing Regulations of Pakistan Stock Exchange Limited, Statement of Compliance with the Code of Corporate Governance along with the auditors’ report thereon for the period ended June 30, 2016 forms part of this annual report.

1. Statements under clause 5.19.11 of the Code:

a. The financial statements, prepared by the management of the listed Fund, present its state of affairs fairly, the result of its operations, cash flows and changes in equity;

b. Proper books of account of the listed Fund have been maintained; c. Appropriate accounting policies have been consistently applied in preparation of financial statements and

accounting estimates are based on reasonable and prudent judgment; d. International Financial Reporting Standards, as applicable in Pakistan, have been followed in preparation of

financial statements and any departures therefrom has been adequately disclosed and explained; e. The system of internal control is sound in design and has been effectively implemented and monitored; f. There are no significant doubts upon the listed Fund’s ability to continue as a going concern; g. The details of taxes, duties, levies and charges outstanding, are disclosed in the financial statements; h. The number of board and committees’ meetings held during the period and attendance by each director forms part

of this Annual Report; and i. The prescribed pattern of shareholding is given as part of this Annual Report.

The sale and repurchase of units of the Fund carried out by the directors, CEO, COO, CFO, Head of Internal Audit, Company Secretary, their spouses and minor children, and the Management Company are as under:

Trades By: Investment Redemption ------------ (No. of Units) --------- Management Company 227,351 227,351

PATTERN OF HOLDING

The Pattern of Holding of FIAAF is given as part of this Annual Report.

AUDITORS

The present auditors Messers EY Ford Rhodes, Chartered Accountants retire and, being eligible, offer themselves for re-appointment. The Board endorses the recommendation of the Audit Committee for re-appointment of Messers EY Ford Rhodes, Chartered Accountants as the auditors for the year ending June 30, 2017.

ACKNOWLEDGEMENT

The Board of Directors of the Management Company is thankful to unit holders for their confidence on the Management, the Securities and Exchange Commission of Pakistan and the management of Pakistan Stock Exchange for their valuable support, assistance and guidance. The Board also thanks the employees of the Management Company and the Trustee for their dedication and hard work.

For and on behalf of the Board

Enamullah KhanKarachi: September 26, 2016 Chief Executive Officer


FUND MANAGER’S REPORT

Economic Review

Pakistan’s economy underwent substantial progress during the course of fiscal year 2016. Almost all the critical macroeconomic indicators exhibited continuous progress which alleviated the GDP growth to reach 8‐year high of 4.7%. The industrial sector activities made significant strides on the back of better energy supply and improved law and order situation. Despite the challenges on external front in the form of declining exports amid deteriorating global growth prospects and heavy agricultural losses, economic recovery process remained on track.

The average inflation during FY16 declined to 47‐year low of 2.86% against 4.53% in the same period last year. Such historical lows were achieved on the back of falling commodity prices and contained food inflation along with help from prudent monetary and fiscal policies. The ‘Perishable Food Items’ and ‘Transport’ heads registered year‐on‐year negative readings at ‐1.82% and ‐5.18% respectively. Likewise, all the other CPI basket items remained benign throughout the year.

International reserve buffers held by State Bank of Pakistan (SBP) were effectively rebuilt during the year. By the year end, foreign exchange reserves reached to USD 18.1 billion, sufficient to finance four months of imports. Muted global oil prices, steady remittances growth, improved Foreign Direct Investments (FDI) and FX borrowing played the much needed role in consolidation of the foreign exchange reserves.

According to the figures of State Bank of Pakistan (SBP), current account deficit (CAD) for the fiscal year 2016 contracted by 6.8% to USD 2.5 billion as compared to USD 2.7 billion in the same period last year. Workers’ remittances, despite looming concerns of slowdown in Gulf region, remained upbeat clocking in at USD 19.9 billion (up 6.4% year‐on‐year) as compared to USD 18.7 billion during the last fiscal year. The current account deficit was further alleviated with an impressive surge of 39% in Foreign Direct Investments (FDI) which clocked in at USD 1.3 billon as compared to USD 0.9 billion last year. This improvement came mainly on account of investment inflows coming from the China‐Pakistan Economic Corridor (CPEC) project.

Export, on the other hand, underwent decline of 8.6% on the back of global meltdown and low commodity prices. Nevertheless, imports bill was reduced by mere 2% owing to substantial increase in non‐oil imports (up 79% to USD 31.8 billion). Accordingly, balance of payments position clocked in at USD ‐2.6 billion, declining by mere 0.3% as compared to the last year. CAD as % of GDP clocked in at ‐ 0.9% as compared to 1.0% during the last fiscal year.

According to Pakistan Bureau of Statistics (PBS), overall Large Scale Manufacturing (LSM) sector has exhibited growth of 3.45% during July‐May 2015‐16 when compared with the same period of last year. Major industries driving the growth were a) automobiles (up 18%), b) fertilizers (up 15%), c) nonmetallic mineral products (up 11%), d) leather products (up 9%), e) chemicals (up 9%), f) rubber products (up 7%) and g) pharmaceuticals (up 6%).

During the year, broad‐based improvements in underlying economic indicators facilitated the State Bank of Pakistan (SBP) to cut its policy rate by a cumulative 75bps in FY16; over and above cut of 300bps in FY15. Going forward, GDP growth is anticipated to remain buoyant on the back of construction and development activities under China Pakistan Economic Corridor (CPEC) and strengthened private sector credit growth. Nonetheless, risks pertaining to challenging global environment and its looming impact on exports and remittances growth could be very critical and may undermine the growth prospects.

Equity Market Review

As market participants weighed Pakistan’s return to MSCI Emerging Markets index together with discounted valuations in major sectors, KSE‐100 index crossed an all‐time high of 39,000 points during intraday trading before closing the year at 37,784 points. The index accumulated 3,385 points during the year and returned 9.8% and 6.8% in PKR and USD respectively. Consequently, the KMI30 Islamic index posted a return of 15.53% as index remained insulated from the weak banking sector performance that hit the KSE100. The local bourse was able to easily outperform both the Emerging and Frontier market index which saw an attrition of 15.5% & 15.1%, respectively. The year also marked the amalgamation of all three bourses into a single Pakistan Stock Exchange (PSX), a positive step towards demutualization of the exchange.

FY16 market performance can be classified as a tale of two halves whereby the 1HFY16 saw the KSE‐100 index declining by 4.6%, while the 2HFY16 saw it rising by a hefty 15.1%. This stark contrast has occurred as key heavy weight Oil & Banking sector declined by 26%/5% in 1HFY16, versus a rise of 27%/2% in the 2HFY16.

While foreign players remained net sellers for the first 10 months of Fy16, the trend changed in last two months with net foreign buying jumping to USD 74mn in Jun‐16, highest monthly inflow in the past 26 months. The hefty inflow may be attributed to Pakistan’s reclassification to MSCI Emerging Markets index along with EFERT’s SPO. Nevertheless,


September 26, 2016


This statement is being presented to comply with the Code of Corporate Governance (the CCG) contained in Paragraph 5.19 of Chapter 5 of Pakistan Stock Exchange Limited’s Regulations (Formerly: Karachi Stock Exchange) for the purpose of establishing a framework of good governance, whereby a listed company is managed in compliance with the best practices of Corporate Governance. The Board of Directors (the Board) of Faysal Asset Management Limited (the Management Company), an unlisted public company, manages the affairs of Faysal Islamic Asset Allocation Fund (the Fund) (launched on September 7, 2015). The Fund being a unit trust open end scheme does not have its own Board of Directors. The Management Company has applied the principles contained in the Code to the Fund in the following manner:

1. The Management Company encourages representation of independent non-executive directors. At present, the Board includes:

The independent directors meet the criteria of independence under clause 5.19.1 (b) of the CCG. 2. The directors have confirmed that none of them are serving as a director on more than seven listed companies,

including the Management Company.

3. All the resident directors of the Management Company are registered taxpayers and none of them have defaulted in payment of any loan to a banking company, a DFI or an NBFI, or being a Broker of a stock exchange, has been declared as a defaulter by that stock exchange.

4. A casual vacancy occurred on the board on 11 December 2015, which has subsequently been filled on 9th August, 2016, after soliciting necessary approvals from the Security and Exchange Commission of Pakistan.

5. The Management Company has prepared a “Code of Conduct” and has ensured that appropriate steps have been taken to disseminate it throughout the company along with its supporting policies and procedures.

6. The Board has developed a vision / mission statement, an overall corporate strategy and significant policies for the Fund. A complete record of particulars of significant policies along with the dates on which these were approved or amended has been maintained.

7. All the powers of the Board have been duly exercised and decisions on material transactions, including appointment, determination of remuneration and terms and conditions of employment of the Chief Executive Officer (CEO) and other executive and non-executive directors have been taken by the Board / shareholders.

8. The meetings of the Board were presided over by the Chairman and, in his absence, by a director elected by the Board for this purpose and the Board met at least once in every quarter, during the year. Written notices of the Board meetings, along with agenda and working papers, were circulated at least seven days before the meetings. The minutes of the meetings were appropriately recorded and circulated.

9. All the directors of the Management Company are well-conversant with the relevant laws applicable to the Fund and Management Company, its policies and procedures and provisions of memorandum and articles of association and are aware of their duties and responsibilities. The Compliance with the requirement of certification of directors is ensured.

10. The board has approved the appointment of Head of Internal Audit including his remuneration and terms and conditions of employment.

STATEMENT OF COMPLIANCE WITH THE BEST PRACTICES OF THECODE OF CORPORATE GOVERNANCE

Independent Director Mr. Osman Asghar Executive Director Mr. Enamullah Khan (CEO)Non-Executive Director Mr. Nauman Ansari Syed Ibad-Ur-Rehman Chishti Mr. Razi-Ur-Rahman Khan Mr. Mohammad Zahid Ahmed

Category Names


11. The Directors' report relating to the Fund for the period ended June 30, 2016 has been prepared in compliance with the requirements of the Code and fully describes the salient matters required to be disclosed.

12. The financial statements of the Fund were duly endorsed by the CEO and CFO of the Management Company before approval of the Board.

13. The Directors, CEO, and executives do not hold any interest in the units of the Fund other than that disclosed in the Directors' report.

14. The Management Company has complied with all the corporate and financial reporting requirements of the CCG.

15. The Board has formed an Audit Committee. It comprises of three members, all of whom are non-executive directors of the Management Company including the chairman of the Committee.

16. The meetings of the Audit Committee were held at least once in every quarter and prior to the approval of interim and final results of the Fund as required by the CCG. However, the meeting due in first quarter of the year 2016 was held on October 6, 2015 due to delay in finalisation of the financial statements for the year ended June 30, 2015. The terms of reference of the Committee have been formed and advised to the Committee for compliance.

17. The Board has formed an HR and Compensation Committee. It comprises of four members of whom two are non-executive directors and the chairman of the Committee is an independent director.

18. The Management Company has outsourced the internal audit function to KPMG Taseer Hadi & Co. Chartered Accountants (the Firm) who are considered suitably qualified and experienced for the purpose and are conversant with the policies and procedures of the Fund.

19. The statutory auditors of the Fund have confirmed that they have been given a satisfactory rating under the Quality Control Review program of the Institute of Chartered Accountants of Pakistan (ICAP), that they or any of the partners of the firm, their spouses and minor children do not hold shares of the Management Company or units of the Fund and that the firm and all its partners are in compliance with the International Federation of Accountants (IFAC) guidelines on code of ethics as adopted by the ICAP.

20. The statutory auditors or the persons associated with them have not been appointed to provide other services except in accordance with the listing regulations and the auditors have confirmed that they have observed IFAC guidelines in this regard.

21. The ‘closed period’, prior to the announcement of interim / final results, and business decisions, which may materially affect the market price of Fund’s units, was determined and intimated to directors, employees and stock exchange.

22. Material / price sensitive information has been disseminated among all market participants at once through stock exchange.

23. We confirm that all applicable material principles enshrined in the Code have been complied with.

Karachi Enamullah Khan Dated: September 26, 2016 Chief Executive Officer

STATEMENT OF COMPLIANCE WITH THE BEST PRACTICES OF THECODE OF CORPORATE GOVERNANCE


INDEPENDENT AUDITORS’ REPORT TO THE UNIT HOLDERS


INDEPENDENT AUDITORS’ REPORT TO THE UNIT HOLDERS

September 26, 2016


STATEMENT OF ASSETS AND LIABILITIESAS AT JUNE 30, 2016

1

June 30,2016

Note --- (Rupees) ---

AssetsBank balances 6 62,359,954 Investments 7 135,633,547

8selbaviecer rehto dna stisopeD 4,004,309 9stsoc noitataolf dna sesnepxe yranimilerP 1,624,127

Total assets 203,621,937

Liabilities01ynapmoC tnemeganaM eht ot elbayaP 3,600,833 11eetsurT eht ot elbayap noitarenumeR 63,409 21seitilibail rehto dna deurccA 1,998,193

Payable against purchase of investments 5,356,423Total liabilities 11,018,858

Net assets 192,603,079

970,306,291)dehcatta tnemetats rep sa( dnuf 'sredloh tinU

(Number of units)

Number of units in issue 2,006,745

----- (Rupees) -----

Net assets value per unit 95.98

The annexed notes from 1 to 20 form an integral part of these financial statements.

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AS AT JUNE 30, 2016

For Faysal Asset Management Limited(Management Company)

FAYSAL ISLAMIC ASSET ALLOCATION FUNDSTATEMENT OF ASSETS AND LIABILITIES


INCOME STATEMENTFOR THE PERIOD FROM SEPTEMBER 09, 2015 TO JUNE 30, 2016

2

From September09, 2015 to

June 30,2016

Income Note --- (Rupees) ---Dividend income on investments classified as 'at fair value

through profit or loss' - held-for-trading 3,163,300 Return on bank balances 3,026,655 Net (loss) / gain on investments 'at fair value through profit

or loss' - held-for-trading:- Net capital gain on sale of investments 1,223,310

3.7stnemtsevni fo noitaulaver no ssol desilaernu teN - (9,200,898) (7,977,588)

Total income (1,787,633)

Expenses1.01ynapmoC tnemeganaM eht fo noitarenumeR 3,731,740 2.21 seitud dna sexat tceridni rof noisivorP 680,670 2.01eef tnemeganaM no xat selaS 522,444 1.11eetsurT eht fo noitarenumeR 565,758 2.11eef eetsurT no xat selaS 79,206

Brokerage charges 995,544 Bank charges 46,864

1.21eef launna PCES 176,010 31 noitarenumer 'srotiduA 511,875

Fees and subscription 277,996 Settlement charges, federal excise duty and capital value tax 311,651 Printing charges and other expenses 263,810 Reimbursement of expenses to the Management Company 10.3 144,568

9stsoc noitataolf dna sesnepxe yranimilerp fo noitasitromA 314,398 Total expenses 8,622,534

)761,014,01(seitivitca gnitarepo morf ssol teN

Element of income and capital gains included in prices997,833,2ten - demeeder stinu ni esoht ssel dlos stinu fo

)863,170,8(noitaxat erofeb doirep eht rof ssol teN

Taxation 14 -

)863,170,8(noitaxat retfa doirep eht rof ssol teN

Other comprehensive income for the period -

)863,170,8(doirep eht rof ssol evisneherpmoc latoT


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FAYSAL ISLAMIC ASSET ALLOCATION FUNDINCOME STATEMENT

FOR THE PERIOD FROM SEPTEMBER 09, 2015 TO JUNE 30, 2016


3


June 30,2016

--- (Rupees) ---

- drawrof thguorb )ssol( / emocni detubirtsidnU

Net loss for the period after taxation (8,071,368)

Undistributed loss carried forward [includes unrealised loss on investments of Rs.9,200,898] (8,071,368)


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FAYSAL ISLAMIC ASSET ALLOCATION FUNDDISTRIBUTION STATEMENT



DISTRIBUTION STATEMENTFOR THE PERIOD FROM SEPTEMBER 09, 2015 TO JUNE 30, 2016

3


June 30,2016

--- (Rupees) ---

- drawrof thguorb )ssol( / emocni detubirtsidnU

Net loss for the period after taxation (8,071,368)

Undistributed loss carried forward [includes unrealised loss on investments of Rs.9,200,898] (8,071,368)




FAYSAL ISLAMIC ASSET ALLOCATION FUNDDISTRIBUTION STATEMENT



CASH FLOW STATEMENTFOR THE PERIOD FROM SEPTEMBER 09, 2015 TO JUNE 30, 2016

4

From September 09, 2015 to

June 30,2016

Note --- (Rupees) ---CASH FLOWS FROM OPERATING ACTIVITIESNet loss for the period before taxation (8,071,368)

Adjustment for non-cash and other items:Net loss / (gain) on investments 'at fair value through profit or loss'

- held-for-trading:- Net capital gain on sale of investments (1,223,310) - Net unrealised loss on revaluation of investments 9,200,898

Dividend income on investments classified as 'at fair value throughprofit or loss' - held-for-trading (3,163,300)

Return on bank balances (3,026,655) Amortisation of preliminary expenses and floatation costs 314,398 Element of income and capital gains included in prices of units sold

less those in units redeemed - net (2,338,799) (8,308,136)

Increase in assetsDeposits and other receivables (2,600,000)

Increase in liabilitiesPayable to the Management Company 1,662,308 Remuneration payable to the Trustee 63,409 Accrued and other liabilities 1,998,193

3,723,910 (7,184,226)

Proceeds from sale of investments 688,881,580 Payments made against purchase of investments (827,136,292) Return received on bank balances 2,705,134 Dividend received 2,638,300 Withholding tax paid (557,788)

)292,356,041(seitivitca gnitarepo ni desu hsac teN

CASH FLOWS FROM FINANCING ACTIVITIESAmounts received against issue of units 460,378,120 Payments made against redemption of units (257,364,874)

642,310,302seitivitca gnicnanif morf detareneg hsac teN 459,953,26doirep eht gnirud stnelaviuqe hsac dna hsac ni esaercni teN

Cash and cash equivalents at the beginning of the period - Cash and cash equivalents at the end of the period 6 62,359,954


_____________________ ___________ ___________Chief Executive Officer Director Director


FAYSAL ISLAMIC ASSET ALLOCATION FUNDCASH FLOW STATEMENT



FOR THE PERIOD FROM SEPTEMBER 09, 2015 TO JUNE 30, 2016STATEMENT OF MOVEMENT IN UNIT HOLDERS' FUND

5


June 30,2016

----- (Rupees) -----

Net assets value per unit at beginning of the period 100.00

Net assets value per unit at end of the period 95.98

Net assets at beginning of the period -

Amounts received on issue of units * 460,378,120

Amounts paid on redemption of units ** (257,364,874) 203,013,246

Element of income and capital gains included in prices ofunits sold less those in units redeemed - net (2,338,799)

Net capital gain on sale of investments 1,223,310 Net unrealised loss on revaluation of investments (9,200,898) Net loss for the period (93,780)

)863,170,8(doirep eht rof ssol evisneherpmoc latoT

970,306,291doirep eht fo dne ta stessa teN

(Number of units)

* Number of units issued 4,616,423

** Number of units redeemed 2,609,678


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FAYSAL ISLAMIC ASSET ALLOCATION FUNDSTATEMENT OF MOVEMENT IN UNITHOLDERS' FUND




NOTES TO THE FINANCIAL STATEMENTSFOR THE PERIOD FROM SEPTEMBER 09, 2015 TO JUNE 30, 2016

6

1. LEGAL STATUS AND NATURE OF BUSINESS

Since the Fund was launched in September 2015, the stability ranking to the Fund is yet to be assigned.

2. STATEMENT OF COMPLIANCE

3. BASIS OF MEASUREMENT

3.1

3.2

3.3 These financial statements are presented in Pak rupees, which is the Fund's functional and presentationcurrency.

JCR - VIS Credit Rating Company limited has awarded an "AM3++" asset manager rating to the ManagementCompany as of May 04, 2016.

These financial statements have been prepared in accordance with approved accounting standards asapplicable in Pakistan. Approved accounting standards comprise of such International Financial ReportingStandards (IFRS) issued by the International Accounting Standards Board (IASB) as are notified under theCompanies Ordinance, 1984, the requirements of the Trust Deed, the NBFC Rules, the Non Banking FinanceCompanies and Notified Entities Regulation, 2008 (the NBFC Regulations) and directives issued by SECP.Wherever the requirements of the Trust Deed, the NBFC Rules, the NBFC Regulations or the directives issuedby SECP differ with the requirements of IFRS, the requirements of the Trust Deed, the NBFC Rules, the NBFCRegulations or the requirements of the said directives prevail.

These financial statements have been prepared under the historical cost convention, except for certaininvestments which are accounted for as stated in note 4.1 below.

The objective of the Fund is to earn competitive riba free return by investing in various Shariah Compliant assetclasses / instruments based on the market outlook.

The Fund is categorised as an "Islamic Asset Allocation Scheme" as per the Circular No.7 of 2009 issued bySECP.

The Fund invests in riba free Shariah Compliant asset classes / instruments. The income on suchinvestments is recognised in accordance with the principles of the Islamic Shariah. However, income, ifany, received which does not comply with the principles of the Islamic Shariah is recognised as charitypayable, if so directed by the Shariah Advisor of the Fund.

The Fund commenced its operations from September 09, 2015. Accordingly, there are no comparatives instatement of assets and liabilities, income statement, distribution statement, cash flow statement and statementof movement in unit holders fund.

FAYSAL ISLAMIC ASSET ALLOCATION FUNDNOTES TO THE FINANCIAL STATEMENTS


Faysal Islamic Asset Allocation Fund (the Fund) has been established under the Non-Banking FinanceCompanies (Establishment and Regulation) Rules, 2003 (the NBFC Rules) and has been authorised as a unittrust scheme by the Securities and Exchange Commission of Pakistan (SECP) on June 12, 2015. It has beenconstituted under a Trust Deed, dated May 18, 2015, between Faysal Asset Management Limited (theManagement Company), a company incorporated under the Companies Ordinance, 1984 and CentralDepository Company of Pakistan Limited (CDC) as the Trustee, also a company incorporated under theCompanies Ordinance, 1984.

The Fund is a Shariah Compliant open-ended asset allocation fund and is listed on the Pakistan StockExchange Limited (formerly Karachi Stock Exchange Limited). Units are offered for public subscription on acontinuous basis and the units are transferable and can be redeemed by surrendering them to the Fund. TheFund was launched on September 09, 2015.


NOTES TO THE FINANCIAL STATEMENTS7 FAYSAL ISLAMIC ASSETALLOCATION FUND

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The following accounting policies were adopted in the preparation of these financial statements:

4.1 Investments

4.1.1 The Fund classifies investments in the following categories:

At fair value through profit or loss

-

-

These investments are initially recognised at fair value, being the cost of the consideration given.

Held to maturity investments

Available-for-sale investments

Loans and receivables

The investments of the Fund, upon initial recognition, are classified as investment at fair value throughprofit or loss, available-for-sale or held to maturity investments as appropriate.

All investments, are initially measured at fair value plus, in the case of investments not at fair value throughprofit or loss, transaction costs that are directly attributable to acquisition.

All regular way purchases / sales of investments that require delivery within the time frame established bythe regulation of market convention are recognised on the trade date, i.e. the date on which the Fundcommits to purchase / sell the investment. Regular way purchases / sales of investments require deliveryof securities within the period generally established by the regulation or market convention such as "T+2".

This category has two sub-categories, namely; financial instruments held-for-trading, and thosedesignated at fair value through profit or loss upon initial recognition.

After initial measurement, investment at fair value through profit or loss are carried at fair value andthe gains or losses on revaluation are recognised in the income statement.

Investment securities with fixed maturities and fixed or determinable payments are classified as 'held-to-maturity investments' when management has both the intention and ability to hold to maturity.After initial measurement, such investments are carried at amortised cost less any provision forimpairment except in case of debt securities and government securities, which are carried at fairvalue in accordance with the requirements of the NBFC Regulations.

Investments which are not classified in any of the preceding categories are classified as available-for-sale investments. After initial measurement, such investments are measured at fair value withunrealised gain or loss recognised directly in the unit holders' fund until the investment isderecognised or determined to be impaired at which time the cumulative gain or loss previouslyrecognised in unit holders' fund is taken to the income statement.

Loans and receivables are non-derivative financial assets with fixed or determinable payments thatare not quoted in an active market, other than those classified by the Fund as 'at fair value throughprofit or loss' or 'available-for-sale'.

Investments designated at fair value through profit or loss upon initial recognition include thosegroup of financial assets which are managed and their performance evaluated on a fair valuebasis, in accordance with the documented risk management / investment strategy.

Investments which are acquired principally for the purposes of generating profit from short termfluctuation in price or are part of the portfolio in which there is recent actual pattern of short-term profit taking are classified as held-for-trading.


NOTES TO THE FINANCIAL STATEMENTS8 FAYSAL ISLAMIC ASSET

ALLOCATION FUND

4.1.2 Fair value of investments is determined as follows:

Listed shares

These are valued on the basis of closing market prices quoted on the respective stock exchanges.

Basis of valuation of Sukuk Certificates

Basis of valuation of GOP Ijara Sukkuks

Loans and receivables

4.2 Issuance and redemption of units

4.3 Provisions

4.4 Net Assets Value (NAV) per unit

4.5 Revenue recognition

- Gain or loss on sale of investments is accounted for in the period in which it arises.

-

-

-

The investment of the Fund in debt securities is valued on the basis of rates determined by theMutual Funds Association of Pakistan (MUFAP) in accordance with the methodology prescribed bySECP for valuation of debt securities vide its Circular No. 1 of 2009 dated January 06, 2009. In thedetermination of the rates, MUFAP takes into account the holding pattern of these securities andcategorises them as traded, thinly traded and non-traded securities. The circular also specifies thevaluation process to be followed for each category as well as the criteria for the provisioning of non-performing debt securities.

Subsequent to initial recognition financial assets classified as loans and receivables are carried atamortised cost using the effective interest method.

Units issued are recorded at the offer price prevalent on the day on which application form, (complete in allrespects) is received. The offer price represents the net assets value of units at the end of the day plus theallowable sales load. The sales load is payable to the Management Company as processing fee. Issue ofunits is recorded on acceptance of application for sale.

The investment of the Fund in GOP Ijara Sukkuks is valued using the PKISRV Reuters ratecirculated by MUFAP.

The net assets value per unit disclosed in the statement of assets and liabilities is calculated by dividingthe net assets of the Fund by the number of units in issue at the period end.

Dividend income on equity securities are recognised in the income statement when the right toreceive the dividend is established.

Unrealised gains or losses arising on revaluation of investments classified as 'at fair value throughprofit or loss' are included in the income statement in the period in which they arise.

Income on government securities, debt securities, return on certificates of investment, profit on cleanplacements and return on bank balances are recognised on a time proportion basis using effectiveinterest rate method.

Units redeemed are recorded at the redemption price, prevalent on the day on which the redemption form(complete in all respects) is accepted. The redemption price represents the net assets value of units at theend of the day. Redemption of units is recorded on acceptance of application for redemption.

Provisions are recognised when the Fund has a present legal or constructive obligation as a result of pastevents, it is probable that an outflow of resources embodying economic benefits will be required to settlethe obligation and a reliable estimate of the obligation can be made. Provisions are regularly reviewed andadjusted to reflect the current best estimate.



4.6

4.7 Taxation

4.8 Cash and cash equivalents

4.9 Distribution to unit holders

4.10 Financial assets and financial liabilities

4.11 Impairment of financial assets

Impairment is determined as follows:

(a)

(b) for assets carried at fair value, impairment is the difference between cost and fair value.

(c)

The Fund is exempt from taxation under clause 99 of Part I of the 2nd Schedule to the Income TaxOrdinance, 2001, subject to the condition that not less than 90% of its accounting income excludingrealised and unrealised capital gains for the period is distributed amongst the unit holders.

Cash and cash equivalents comprise cash at banks and short-term deposits with an original maturity ofthree months or less. Cash and cash equivalents are carried in the statement of assets and liabilities atcost.

Distribution to unit holders made subsequent to the statement of assets and liabilities date are consideredas non-adjusting events and are recognised in the financial statements in the period in which suchdistributions are declared and approved by the Board of Directors of the Management Company.

All financial assets and financial liabilities are recognised at the time when the Fund becomes a party to thecontractual provisions of the instrument. Financial assets are derecognised when the contractual rights toreceive cash flows related to the asset expire. Financial liabilities are derecognised when they areextinguished, that is, when the obligation specified in the contract is discharged, cancelled or expires. Anygain or loss on derecognition of the financial assets and financial liabilities is taken to income statementcurrently.

Financial assets carried in the statement of assets and liabilities include bank balances, investments anddeposits and other receivables.

Financial liabilities carried in the statement of assets and liabilities include payable to the ManagementCompany, remuneration payable to the Trustee, payable against purchase of investments and accrued andother liabilities.

for assets carried at amortised cost, impairment is based on estimated cash flows discounted at theoriginal effective interest rate.

The element is arrived at by comparing the unit prices with opening Ex - Net Assets Value (NAV) atbeginning of the financial period. The element so computed is recognised in the income statement exceptto the extent that the amount represented by unrealised appreciation / diminution arising on available-for-sale investments is included in distribution statement.

The net “element of income / (loss) and capital gains / (losses) included in prices of units sold less those inunits redeemed” during an accounting period is transferred to the income statement.

An assessment is made at each statement of assets and liabilities date to determine whether there isobjective evidence that a specific financial asset may be impaired. If such evidence exists, any impairmentloss, is recognised in the income statement.

for assets carried at cost, impairment is present value of future cash flows discounted at the currentmarket rate of return for a similar financial asset.

Element of income / (loss) and capital gains / (losses) included in prices of units issued less thosein units redeemed

An equalisation account called the "element of income / (loss) and capital gains / (losses) included inprices of units issued less those in units redeemed" (the element) is created in order to prevent the dilutionof per unit income and distribution of income already paid out on redemption.



4.12 Offsetting of financial assets and financial liabilities

4.13 Preliminary expenses and floatation costs

4.14

Effective date(accounting periods

Standard or Interpretation beginning on or after)

IFRS 2 – Share-based Payments – Classification and Measurement 8102 ,10 yraunaJ)stnemdnemA( snoitcasnarT stnemyaP desab-erahS fo

IFRS 10 – Consolidated Financial Statements, IFRS 12 Disclosure of Interests in Other Entities and IAS 28 Investment in Associates – Investment Entities: Applying the Consolidation Exception (Amendment) January 01, 2016

IFRS 10 – Consolidated Financial Statements and IAS 28 Investmentin Associates and Joint Ventures - Sale or Contribution of Assets between an Investor and its Associate or Joint Venture (Amendment) Not yet finalized

IFRS 11 – Joint Arrangements - Accounting for Acquisition 6102 ,10 yraunaJ)tnemdnemA( noitarepO tnioJ ni tseretnI fo

IAS 1 – Presentation of Financial Statements - 6102 ,10 yraunaJ)tnemdnemA( evitaitinI erusolcsiD

IAS 7 – Financial Instruments: Disclosures - 7102 ,10 yraunaJ)tnemdnemA( - evitaitinI erusolcsiD

IAS 12 – Income Taxes – Recognition of Deferred Tax Assets 7102 ,10 yraunaJ)stnemdnemA( sessol dezilaernU rof

IAS 16 – Property, Plant and Equipment and IAS 38intangible assets - Clarification of Acceptable Method of

6102 ,10 yraunaJ)tnemdnemA( noitazitromA dna noitaicerpeD

The following standards, amendments and interpretations with respect to the approved accountingstandards as applicable in Pakistan would be effective from the dates mentioned below against therespective standard or interpretation:

Standards, interpretations and amendments to approved accounting standards that are not yeteffective

For available-for-sale equity investments, reversal of impairment losses are recorded as increase incumulative changes in fair value through unit holders' fund.

In addition, a provision is made to cover impairment for specific groups of assets where there is ameasurable decrease in estimated future cash flows.

Preliminary expenses and floatation costs represent expenditure incurred in connection with incorporation,registration, establishment and authorisation of the Fund till the close of the Initial Public Offering period.These costs are to be amortised over a period not exceeding sixty months in accordance with the TrustDeed.

Financial assets and financial liabilities are only offset and the net amount reported in the statement ofassets and liabilities when there is a legally enforceable right to set off the recognised amount and theFund intends to either settle on a net basis, or to realise the asset and settle the liability simultaneously.



Effective date(accounting periods

Standard or Interpretation beginning on or after)

IAS 16 – Property, Plant and Equipment IAS 41 Agriculture – 6102 ,10 yraunaJ)tnemdnemA( stnalP reraeB :erutlucirgA

IAS 27 – Separate Financial Statements – Equity Method 6102 ,10 yraunaJ)tnemdnemA( stnemetatS laicnaniF etarapeS ni

IASB effective date (annual )retfa ro no gninnigeb sdoirepdradnatS

IFRS 9 – Financial Instruments: Classification and Measurement January 01, 2018

IFRS 14 – Regulatory Deferral Accounts January 01, 2016

IFRS 15 – Revenue from Contracts with Customers January 01, 2018

IFRS 16 – Leases January 01, 2019

5. ACCOUNTING ESTIMATES AND JUDGMENTS

June 30,2016

Note -- (Rupees) --6. BANK BALANCES

1.6stnuocca sgnivas SLP - knab ta hsaC 62,359,954

6.1

7. INVESTMENTS

'At fair value through profit or loss' - held-for-trading1.7seitiruces ytiuqe detsiL 135,633,547

The preparation of financial statements requires management to make judgments, estimates and assumptionsthat effect the application of policies and reported amounts of assets and liabilities, income and expenses. Theestimates and associated assumptions are based on historical experience and various other factors that arebelieved to be reasonable under the circumstances, the result of which form the basis of making judgmentsabout carrying values of assets and liabilities. The estimates and underlying assumptions are reviewed on anongoing basis.

Judgments made by management in the application of accounting policies that have significant effect on thefinancial statements and estimates with a significant risk of material adjustment are explained in notes 4.1, 4.10and 4.11 to the financial statements.

The above standards and amendments are not expected to have any material impact on the Fund'sfinancial statements in the period of initial application.

In addition to the above standards and amendments, improvements to various accounting standards havealso been issued by the IASB in September 2014. Such improvements are generally effective foraccounting periods beginning on or after January 01, 2016. The Fund expects that such improvements tothe standards will not have any material impact on the Fund's financial statements in the period of initialapplication.

Further, following new standards have been issued by IASB which are yet to be notified by the SECP forthe purpose of applicability in Pakistan.

These carry mark-up ranging between 2.40% and 6.10% per annum and include balance of Rs.32,652 heldwith Faysal Bank Limited, a related party.



ALLOCATION FUND

7.1 Listed equity securities * - held-for-trading

* Ordinary shares having a face value of Rs.10 each unless stated otherwise

Oil and gasHascol Petroleum Limited 7.1.2 485,000 22,000 505,900 1,100 169,730 214,907 45,177 0.11% 0.16% 0.00%

050,601detimiL ynapmoC muelorteP iraM - 106,050 - - - - - - - Oil & Gas Development Company Limited 105,000 - 105,000 - - - - - - -

001,55detimiL ynapmoC liO etatS natsikaP - 55,100 - - - - - - - 000,56detimiL muelorteP natsikaP - 65,000 - - - - - - - 006,241detimiL sdleiF liO natsikaP - 137,100 5,500 1,919,011 1,911,140 (7,871) 0.99% 1.41% 0.00%

2,088,741 2,126,047 37,306 1.10% 1.57%

Multiutilities (gas and water)000,001detimiL ynapmoC saG nrehtuoS iuS - - 100,000 2,763,875 2,753,000 (10,875) 1.43% 2.03% 0.01%000,055,1detimiL senilepiP saG nrehtroN iuS - 1,550,000 - - - - - - -

2,763,875 2,753,000 (10,875) 1.43% 2.03%

Chemicals000,51detimiL natsikaP leboN ozkA - 15,000 - - - - - - - 009,34detimiL natsikaP ICI - 3,400 40,500 19,724,814 18,023,310 (1,701,504) 9.36% 13.29% 0.04%000,573detimiL misaQ niB rezilitreF ijuaF - 295,000 80,000 4,535,120 4,240,800 (294,320) 2.20% 3.13% 0.01%000,223detimiL noitaroproC orgnE - 320,000 2,000 666,020 665,940 (80) 0.35% 0.49% 0.00%000,571detimiL ynapmoC rezilitreF ijuaF - 175,000 - - - - - - - 000,461detimiL ynapmoC rezilitreF amitaF - 149,000 15,000 475,728 509,100 33,372 0.26% 0.38% 0.00%000,5051.1.7detimiL srezilitreF orgnE - 255,000 250,000 16,776,609 16,120,000 (656,609) 8.37% 11.88% 0.02%

42,178,291 39,559,150 (2,619,141) 20.54% 29.17%

Construction and materials000,021detimiL ynapmoC tnemeC tarehC - 120,000 - - - - - - - 005,723detimiL ynapmoC tnemeC nahK .G.D - 327,500 - - - - - - - 000,87detimiL tnemeC ykcuL - 63,000 15,000 9,930,006 9,727,650 (202,356) 5.05% 7.17% 0.00%000,571detimiL tnemeC reenoiP - 175,000 - - - - - - -

9,930,006 9,727,650 (202,356) 5.05% 7.17%

Software and computer services000,672detimiL smetsyS - 276,000 - - - - - - -

Food producers000,004detimiL noitaroproC reehahS lA 52,500 452,500 - - - - - - -

General Industrials005,71detimiL segakcaP - 2,500 15,000 8,621,253 9,543,300 922,047 4.95% 7.04% 0.02%000,52detimiL sesirpretnE tcudorP citehtnyS - 25,000 - - - - - - -

8,621,253 9,543,300 922,047 4.95% 7.04%

Industrial metals and miningCrescent Steel and Allied Products Limited 7.1.1 601,000 - 311,000 290,000 36,672,340 33,236,900 (3,435,440) 17.26% 24.50% 0.37%

000,002detimiL sleetS ilermA - 200,000 - - - - - - - 36,672,340 33,236,900 (3,435,440) 17.26% 24.50%

Automobile and parts004,52detimiL nassiN arahdnahG - 25,400 - - - - - - - 002,7detimiL ynapmoC rotoM ikuzuS kaP - 7,200 - - - - - - -

- - - - -Personal goods (textile)

000,052detimiL slliM tahsiN - 50,000 200,000 23,984,444 21,580,000 (2,404,444) 11.20% 15.91% 0.06%000,51detimiL )nainuhC( tahsiN - 15,000 - - - - - - -

23,984,444 21,580,000 (2,404,444) 11.20% 15.91%Engineering

002,03srotcarT talliM - 200 30,000 18,595,495 17,107,500 (1,487,995) 8.88% 12.61% 0.07%000,051detimiL seirtsudnI leetS & norI lahguM - 150,000 - - - - - - -

18,595,495 17,107,500 (1,487,995) 8.88% 12.61%

Fixed line communicationPakistan Telecommunication Company Limited 195,000 - 195,000 - - - - - - -

7,101,450 74,500 6,131,850 1,044,100 144,834,445 135,633,547 (9,200,898) 70.41% 100.00%

7.1.1

June 30, June 30,2016 2016

(Number of shares) -- (Rupees) --

Crescent Steel and Allied Products Limited 100,000 11,461,000Engro Fertilizers Limited 100,000 6,448,000

200,000 17,909,000

7.1.2

Net assetsTotal

investments

Investeecompany paid-

up capital

------------- Number of shares ------------- ----- Balance as at June 30, 2016 -----

Cost

This investment includes bonus shares having market value of Rs.0.22 million withheld by the investee company during the period as issuance of bonus shares has been made taxablethrough Finance Act, 2014. Consequently, bonus shares equivalent to 5% (representing tax impact of the bonus announcement) have been withheld by the investee company.

The Mutual Funds Association of Pakistan (MUFAP) has filed a petition in the Honorable Sindh High Court (SHC) to declare the amendments brought in the Income Tax Ordinance, 2001with reference to tax on bonus shares for collective investment schemes as null and void and not applicable on the mutual funds, based on the premise of exemption given to mutualfunds under clause 47B and 99 of Second Schedule to the Income Tax Ordinance, 2001. The case was dismissed by SHC against MUFAP and various other plantiffs vide judgementdated September 08, 2015. However, MUFAP along with various other mutual funds has filed an appeal before SHC under the section 3 of the Law Reforms Ordinance, 1972. The SHChas suspended the operation of the earlier impugned order and has granted stay from tax on bonus shares.

Market / carrying value

Unrealized(loss) / gain

on revaluation

Following shares have been pledged with National Clearing Company of Pakistan Limited (NCCPL) security against settlement of the Fund's trades in terms of Circular No. 11 dated October 23, 2007 issued by SECP:

---------------------- (Rupees) ---------------------Name of the investee company

-------- Investment as % of --------

Note

Purchasedduring the

period

Bonusreceived

during the period

Disposed off during the

periodAs at June

30, 2016



ALLOCATION FUND

7.2 Details of non-compliant investment

Crescent Steel and Allied Listed equity Products Limited 7.2.1 securities 33,236,900 15% 17.26% 16.32%

7.2.1

June 30,2016

Note -- (Rupees) --7.3 Net unrealised loss on revaluation of investments classified

as 'at fair value through profit or loss' - held-for-trading

Market value of investments 135,633,547 Less: Cost of investments (144,834,445)

(9,200,898)

8. DEPOSITS AND OTHER RECEIVABLES - considered good

Security deposits- National Clearing Company of Pakistan Limited 2,500,000 - Central Depository Company of Pakistan Limited 100,000

2,600,000

Return receivable on bank balances 321,521 1.8elbarevocer xat emocnI 557,788

Dividend receivable 525,000 4,004,309

8.1

9. PRELIMINARY EXPENSES AND FLOATATION COSTS

Preliminary expenses and floatation costs 1,938,525 1.9doirep eht gnirud desitromA (314,398)

1,624,127

9.1 Preliminary expenses and floatation costs represent expenditure incurred prior to the commencement ofoperations of the Fund as incurred by the Management Company and are being amortised over a period offive years commencing from September 09, 2015.

The above exposure is in excess of the limit prescribed by the NBFC Regulations and disclosure forbreach of exposure limit is made as required by the Circular No.16 of 2010 dated July 07, 2010 bySECP. However, the NBFC Regulations allow four months time period to regularize these exposures.

This represents tax deducted under section 236(M) of the Income Tax Ordinance, 2001 on bonus sharesissued to the Fund by the investees.

Name of non-compliant investment

Type of instrument

Value of investment(Rupees)

Limit of investment in

a single company as a percentage of

net assets

Investment as at period end as a percentage of

NoteNet

assets Gross assets



ALLOCATION FUND

June 30,2016

Note -- (Rupees) --10. PAYABLE TO THE MANAGEMENT COMPANY

Management fee payableSales tax payable on Management fee

elbayap daol selaSstsoc noitataolf dna sesnepxe yranimilerP

Reimbursement of expenses payable tothe Management Company

Other payable

10.1

10.2

10.3

11. REMUNERATION PAYABLE TO THE TRUSTEE

1.11eetsurT eht ot elbayap noitarenumeR 55,621 2.11eef eetsurT no elbayap xat selaS 7,788

63,409

11.1

11.2

12. ACCRUED AND OTHER LIABILITIES

1.21elbayap eef launna PCES 176,010 Brokerage payable 396,664 Accrued liabilities 744,849

2.21seitud dna sexat tceridni rof noisivorP 680,670 1,998,193

12.1

The Management Company is entitled to remuneration for services rendered to the Fund under theprovisions of NBFC Regulations of an amount not exceeding 2% of average annual net assets of the Fund.The Management Company has charged its remuneration accordingly.

The Government of Sindh has levied Sindh Sales Tax at the rate of 14% on the remuneration of theManagement Company through the Sindh Sales Tax on Services Act, 2011.

The Trustee is entitled to a monthly remuneration for services rendered to the Fund under the provisions ofthe Trust Deed as per the tariff specified therein, based on the daily net assets value of the Fund.

The Government of Sindh has levied Sindh Sales Tax at the rate of 14% on the remuneration of the Trusteethrough the Sindh Sales Tax on Services Act, 2011.

SECP has introduced "expense ratio" vide amendments in NBFC Regulations dated November 25, 2015,whereby, the total expense ratio of an asset allocation scheme shall be capped at 4% of average daily netassets value of the scheme. The regulation further states that for the purpose of expense ratio, expensesincurred in relation to any government levy on funds such as sales tax, federal excise duty, SECP fee, etc.shall be excluded while calculating expense ratio. Furthermore, under NBFC Regulation 60(3)(s), whereinthe Management Company is allowed to charge their cost to Collective Investment Schemes (CIS) in respectof fees and expenses related to registrar services, accounting, operations and valuation services related tothat CIS. The maximum cost that can be charged in this regard is up to 0.1% of the average annual netassets of that CIS or actual, whichever is less. Accordingly, this represents the amount payable to theManagement Company to maintain the expense ratio of the Fund within the prescribed limits.

This represents annual fee payable to SECP in accordance with the NBFC Regulations, whereby the Fund isrequired to pay SECP annually an amount equal to 0.095% per annum of the daily net asset value of theFund.

1.01 371,012 2.01 51,941

1,064,787 9 1,938,525

10.3 144,568 30,000

3,600,833



12.2

13. AUDITORS' REMUNERATION

Audit fee 330,000 Review and other certifications 150,000 Other 7,500

487,500 Sales tax 24,375

511,875

14. TAXATION

15. TRANSACTIONS WITH CONNECTED PERSONS / RELATED PARTIES

15.1

15.2 The transactions with connected persons are in the normal course of business, at contracted rates.

15.3

Connected persons / related parties include Faysal Asset Management Limited being the ManagementCompany, CDC being the Trustee, other collective investment schemes managed by the ManagementCompany, Faysal Asset Management Limited - Staff Provident Fund, Faysal Asset Management Limited -Staff Gratuity Fund, Faysal Bank Limited, Faysal Bank Limited - Staff Provident Fund, Faysal Bank Limited -Staff Gratuity Fund and other entities under common management and / or directorship and the directorsand officers of the Management Company and the Trustee.

The income of the Fund is exempt from income tax under Clause (99) of Part 1 of the Second Schedule to theIncome Tax Ordinance, 2001 (Clause 99) subject to the condition that not less than 90 percent of the accountingincome for the period, as reduced by capital gains, whether realized or unrealized, is distributed in cash amongstthe unit holders. As there is loss for the period, no distribution was made. Accordingly, no provision for current anddeferred tax has been made in these financial statements.

The Sindh High Court in its decision dated July 16, 2016 maintained the previous order passed against otherconstitutional petition whereby levy of FED is declared to be ‘Ultra Vires’ the Constitution. The managementis however of the view that since the Federal government still has the right to appeal against the order, theprovision held for FED shall not be reversed.

Further, as per the Finance Act, 2016, the management fees charged by the asset management companyhave been declared exempt from the levy of FED with effect from July 01, 2016. Accordingly, no provision forFED is made from July 01, 2016 onwards.


--- (Rupees) ---

The details of significant transactions carried out by the Fund with connected persons / related parties andbalances with them at period end are as follows:

2016

As per the requirements of the Finance Act, 2013, Federal Excise Duty (FED) at the rate of 16% on theservices of the Management Company has been applied effective June 13, 2013. The ManagementCompany is of the view that since the remuneration is already subject to provincial sales tax, further levy ofFED results in double taxation, does not appear to be the spirit of the law. The matter has been collectivelytaken up by the Management Company jointly with other Asset Management Companies and CDC on behalfof Collective Investment Schemes through a constitutional petition filed in the Honourable Sindh High Court(SHC) in September 2013. The Fund, as a matter of abundant caution, has charged FED and sales tax onservice thereon in its financial statements with effect from the date of commencement of its operations. As atJune 30, 2016, the Fund has held a provision for FED aggregating to Rs.0.68 million.

June 30,

NOTES TO THE FINANCIAL STATEMENTS


16 FAYSAL ISLAMIC ASSETALLOCATION FUND

Transactions during the period

Faysal Asset Management Limited (Management Company)Remuneration of the Management Company 3,731,740 Sales tax on Management fee 522,444 Reimbursement of expenses to the Management Company 144,568 Issue of 227,351 units 22,735,023 Redemption of 227,351 units 22,797,557

Central Depository Company of Pakistan Limited -(Trustee of the Fund)Remuneration of the Trustee 565,758 Sales tax on Trustee fee 79,206 Settlement charges 64,592

Unit holder holding 10% or more units

Nighat FaruqiIssue of 245,290 units 25,000,000

Syed Yawar AliIssue of 611,208 units 60,524,551 Redemption of 408,131 units 39,496,027

Muller & Phipps Pakistan (Pvt.) Limited - Staff Provident FundIssue of 240,381 units 24,037,875

Outstanding balances

Faysal Asset Management Limited (Management Company)Management fee payable 371,012 Sales tax payable on Management fee 51,941 Sales load payable 1,064,787 Preliminary expenses and floatation costs 1,938,525 Reimbursement of expenses payable to

the Management Company 144,568 Other payable 30,000

Faysal Bank Limited (Group / Associated Company)Balance in PLS savings account 32,652

Central Depository Company of Pakistan Limited -(Trustee of the Fund)Remuneration payable to the Trustee 55,621 Sales tax payable on Trustee fee 7,788

Unit holder holding 10% or more units

Nighat FaruqiUnits in issue 245,290 units 23,542,934

Syed Yawar AliUnits in issue 203,077 units 19,491,330

Muller & Phipps Pakistan (Pvt.) Limited - Staff Provident FundUnits in issue 240,381 units 23,071,768

June 30,2016

-- (Rupees) --


June 30,2016

-- (Rupees) --



16. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES

16.1 Market risk

(i) Equity price risk

(ii) Profit rate risk

(iii) Foreign currency risk

The analysis of Fund's concentration on equity price risk is disclosed in note 7.1 to these financialstatements.

Foreign currency risk is the risk that the fair value or future cash flows of a financial instrument willfluctuate because of changes in foreign exchange rates. The Fund does not have any financialinstruments in foreign currencies and hence is not exposed to such risk.

The Fund’s objective in managing risk is the creation and protection of unit holders’ value. Risk is inherent in theFund’s activities, but it is managed through monitoring and controlling activities which are primarily set up to beperformed based on limits established by the Management Company, Fund's constitutive documents and theregulations and directives of the SECP. These limits reflect the business strategy and market environment of theFund as well as the level of the risk that Fund is willing to accept. The Board of Directors of the ManagementCompany supervises the overall risk management approach within the Fund. The Fund is exposed to market risk,liquidity risk and credit risk arising from the financial instruments it holds.

Market risk is the risk that the fair value or future cash flows of financial instruments will fluctuate due tochanges in market variables such as equity prices, profit rates, foreign exchange rates and debt securityprices.

Equity price risk is the risk of volatility in share prices resulting from their dependence on marketsentiments, speculative activities, supply and demand for shares and liquidity in the market. Theequity price risk exposure arises from the Fund's investment in equity securities. Management of theFund estimates that a 5% increase or decrease in the overall equity prices in the market with all otherfactors remaining constant would result in increase or decrease of Fund's net assets by Rs.6.78million. However, in practice, the actual results may differ from the sensitivity analysis.

The Fund is not exposed to fixed rate financial assets. Therefore, a change in their profit rates at thereporting date would not have any impact on the income and net assets of the Fund.

The Management Company manages the above market risks through diversification of investmentportfolio and placing limits on individual and aggregate exposures in accordance with the internal riskmanagement policies and regulations laid down by the SECP.

Profit rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuatebecause of changes in market profit rates. As of June 30, 2016, the Fund's exposure to the risk ofchanges in market profit rates relates primarily to bank balances. The bank balances are subject toprofit rates as declared by the respective banks on periodic basis. As at June 30, 2016 approximately30.96% of the Fund's financial assets are subject to profit rates.

Management of the Fund estimates that an increase of 100 basis points in the profit rate, with allother factors remaining constant, would increase the Fund's income and increase the net assets ofthe Fund by Rs.0.62 million and a decrease of 100 basis points would decrease the Fund's incomeand decrease the net assets of the Fund by the same amount. However, in practice, the actualresults may differ from the sensitivity analysis.



16.2 Liquidity risk

Financial liabilitiesPayable to the Management Company 1,610,367 1,938,525 - 3,548,892 Remuneration payable to the Trustee 55,621 - - 55,621 Accrued and other liabilities 1,084,448 - - 1,084,448 Payable against purchase of investments 5,356,423 - - 5,356,423

8,106,859 1,938,525 - 10,045,384

16.3 Credit risk

June 30,2016

-- (Rupees) --

Bank balances 62,359,954 Return receivable on bank balances 321,521 Dividend receivable 525,000 Security deposits 2,600,000

65,806,475

------- % -------Rating categoryAAA, AA+, AA, AA- 11.07%A+, A, A- 84.23%BBB+ 0.09%Unrated 4.61%

100.00%

Upto three months

More than three

months and upto one

yearMore than one year latoT6102 ,03 enuJ

Liquidity risk is defined as the risk that the Fund will encounter difficulty in meeting obligations associated withfinancial liabilities. Liquidity risk arises because of the possibility that the Fund could be required to pay itsliabilities earlier than expected. The Fund is exposed to cash redemptions of its redeemable units on aregular basis. Units are redeemable at the unit holders' option based on the Fund’s net assets value per unitat the time of redemption calculated in accordance with the Fund’s constitutive documents.

The table below summarises the maturity profile of the Fund's financial liabilities based on contractualundiscounted payments.

The table below analyses the Fund's maximum exposure to credit risk. The maximum exposure is showngross, before the effect of mitigation through the use of collateral agreements at reporting date:

All deposits with banks, CDC and NCCPL are highly rated and risk of default is considered minimal.

Concentration of credit risk exists when changes in economic or industry factors affect the group ofcounterparties whose aggregate credit exposure is significant in relation to the Fund’s total credit exposure.The Fund’s portfolio of financial assets is broadly diversified and transactions are entered into with diversecredit worthy counterparties thereby mitigating any significant concentration of credit risk. The table belowanalyses the credit quality of the Fund's exposure:

Credit risk is the risk that the counterparty to a financial instrument will cause a financial loss for the Fund byfailing to discharge its obligation. The Fund’s policy is to enter into financial contracts with reputable counterparties in accordance with the internal guidelines, offering document and regulatory requirements.

--------------------------- (Rupees) --------------------------------



ALLOCATION FUND

The table below analyses the Fund's concentration of credit risk by industrial distribution:

June 30,2016

Commercial banks 95.25%Others 4.75%

100.00%16.4 Unit holders' fund

The Fund has no restrictions or specific capital requirements on the subscription and redemption of units.

17. FAIR VALUE OF FINANCIAL INSTRUMENTS

Fair value hierarchy

Level 1: quoted prices in active markets for identical assets.

Level 2:

Level 3:

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

other techniques for which all inputs which have a significant effect on the recorded fair value areobservable, either directly or indirectly.

techniques which use inputs which have a significant effect on the recorded fair value that are not basedon observable market data.

The capital of the Fund is represented by the net assets attributable to holders of redeemable units. Thecapital structure depends on the issuance and redemption of units. The Fund’s objective when managing unitholders’ fund is to safeguard the Fund’s ability to continue as a going concern in order to seek maximumpreservation of unit holders’ fund and an optimum rate of return by investing in avenues having good creditrating and liquidity and to maintain a strong capital base to support the development of the investmentactivities of the Fund.

IFRS 13 establishes a single source of guidance under IFRS for all fair value measurements and disclosures aboutfair value measurement where such measurements are required as permitted by other IFRSs. It defines fair valueas the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction betweenmarket participants at the measurement date (i.e. an exit price). Adoption of IFRS 13 has not affected the financialstatements.

Underlying the definition of fair value is the presumption that the Fund is a going concern without any intention orrequirement to curtail materially the scale of its operations or to undertake a transaction on adverse terms.

Under the NBFC Regulations, the minimum size of an open end scheme shall be one hundred million rupeesat all the times during the life of the scheme.

% of assets exposed to credit risk

In accordance with the risk management policies, the Fund endeavours to invest the subscriptions receivedin appropriate investments while maintaining sufficient liquidity to meet redemption requests, such liquiditybeing augmented by short-term borrowings or disposal of investments where necessary.


NOTES TO THE FINANCIAL STATEMENTS20

FAY

SA

L IS

LAM

IC A

SS

ET

ALL

OC

AT

ION

FU

ND

Leve

l 1Le

vel 2

Leve

l 3To

tal

Fina

ncia

l ass

ets

mea

sure

d at

fair

valu

e

'At f

air v

alue

thro

ugh

prof

it or

loss

' -

held

-for-

trad

ing

List

ed e

quity

sec

uriti

es13

5,63

3,54

7-

-

135,

633,

547

135,

633,

547

-

-

13

5,63

3,54

7

Fina

ncia

l ass

ets

not

mea

sure

d at

fair

valu

eB

ank

bala

nces

-

-

62

,359

,954

62

,359

,954

-

-

-

-

Dep

osits

and

oth

er re

ceiv

able

s-

3,

446,

521

-

3,

446,

521

-

-

-

-

135,

633,

547

3,44

6,52

1

62,3

59,9

54

20

1,44

0,02

2

135,

633,

547

-

-

13

5,63

3,54

7

Fina

ncia

l lia

bilit

ies

Pay

able

to th

e M

anag

emen

t Com

pany

-

3,54

8,89

2

3,54

8,89

2

R

emun

erat

ion

paya

ble

to th

e Tr

uste

e-

55

,621

55

,621

Acc

rued

and

oth

er li

abili

ties

-

1,08

4,44

8

1,08

4,44

8

P

ayab

le a

gain

st p

urch

ase

of in

vest

men

ts-

5,

356,

423

5,

356,

423

-

10

,045

,384

10,0

45,3

84

------

------

------

-----

(Rup

ees)

-----

------

------

------

June

30,

201

6eulav riaF

tnuoma gniyrra

C

Inve

stm

ents

Dep

osits

and

ot

her

rece

ivab

les

------

------

------

------

------

--- (R

upee

s) --

------

------

------

------

------

-

Cas

h an

d ca

sh

equi

vale

nts

Tota

l---

------

------

------

------

------

--- (R

upee

s) --

------

------

------

------

------

----

Dur

ing

the

perio

d en

ded

June

30,

201

6, th

ere

wer

e no

tran

sfer

s be

twee

n le

vel 1

and

leve

l 2 fa

ir va

lue

mea

sure

men

ts, a

nd n

o tra

nsfe

r int

o an

d ou

t of l

evel

3 fa

ir va

lue

mea

sure

men

ts.

'At f

air v

alue

th

roug

h pr

ofit

and

loss

' - h

eld-

for-

trad

ing

Oth

er fi

nanc

ial

liabi

litie

sTo

tal

June

30,

201

6



ALLOCATION FUND

18. SUPPLEMENTARY NON FINANCIAL INFORMATION

19. GENERAL

19.1 Figures have been rounded off to the nearest rupee.

19.2 Being the first accounting period of the Fund, there are no corresponding figures to report.

20. DATE OF AUTHORISATION FOR ISSUE


The information regarding pattern of unit holding, top ten brokers, members of the Investment Committee,performance table, fund manager, meetings of the Board of Directors of the Management Company and rating ofthe Fund and the Management Company has been disclosed in Annexure I to the financial statements.

This condensed interim financial information was authorised for issue on September 26, 2016 by the Board ofDirectors of the Management Company.


(i) PATTERN OF UNIT HOLDING

No. of investors Units held %

--- ynapmoc detaicossA---ynapmoc ecnarusnI

240,8935sdnuF tnemeriteR 19.84865,983,1501slaudividnI 69.246931sIFD dna sknaB 0.02

---sCFBN737,8123rehtO 10.90

114 2,006,744 100.00

(ii) TOP TEN BROKERS BY PERCENTAGE OF COMMISSION PAIDJune 30, 2016

%Investment Manager 11.58%Alfalah Securities 11.49%Invest & Finance Securities 11.29%We Financial Services Limited 9.99% Fortune Securities 9.12%Arif Habib Securities Limited 7.92%JSK Securities Limited 7.55%Adam Securities Pvt. Ltd 7.51%KASB Securities Ltd 7.40%Intermarket Securities Limited 6.01%

(iii) THE MEMBERS OF THE INVESTMENT COMMITTEE

Following are the members of the Investment Committee of the Fund:

ecneirepxEnoitacifilauQemaNsraey 42 revOsnoitatiderccA ,ASF , ocE .BnahK hallU manE .rMsraey 12 revOI AFC ,AMCA ,ABMnassaH lU mjaN .rM

sraey 8 revOecneicS ni retsaMdemhA hessaV .rMsraey 8 revOI AFC ,scimonocE CSBorhuhK buyA .rMsraey 01 revOFEM & )scitsitatS( CSM nassaH fiaS .rM

sraey 8 revOII AFC ,ACCA )gnitoV-noN( nahK rawraS .rM

Name

SUPPLEMENTARY NON FINANCIAL INFORMATIONDISCLOSURE REQUIREMENTS UNDER CLAUSE 6 - NOTES TO THE ACCOUNTS

SUB CLAUSE (D), (F), (G), (H), (I) AND (J) OF THE 5TH SCHEDULE TO THE NON BANKING FINANCE COMPANIES AND NOTIFIED ENTITIES REGULATIONS, 2008

Faysal Islamic Asset Allocation Fund

Category



Annexure I


(i) PATTERN OF UNIT HOLDING

No. of investors Units held %

--- ynapmoc detaicossA---ynapmoc ecnarusnI

240,8935sdnuF tnemeriteR 19.84865,983,1501slaudividnI 69.246931sIFD dna sknaB 0.02

---sCFBN737,8123rehtO 10.90

114 2,006,744 100.00

(ii) TOP TEN BROKERS BY PERCENTAGE OF COMMISSION PAIDJune 30, 2016

%Investment Manager 11.58%Alfalah Securities 11.49%Invest & Finance Securities 11.29%We Financial Services Limited 9.99% Fortune Securities 9.12%Arif Habib Securities Limited 7.92%JSK Securities Limited 7.55%Adam Securities Pvt. Ltd 7.51%KASB Securities Ltd 7.40%Intermarket Securities Limited 6.01%

(iii) THE MEMBERS OF THE INVESTMENT COMMITTEE

Following are the members of the Investment Committee of the Fund:

ecneirepxEnoitacifilauQemaNsraey 42 revOsnoitatiderccA ,ASF , ocE .BnahK hallU manE .rMsraey 12 revOI AFC ,AMCA ,ABMnassaH lU mjaN .rM

sraey 8 revOecneicS ni retsaMdemhA hessaV .rMsraey 8 revOI AFC ,scimonocE CSBorhuhK buyA .rMsraey 01 revOFEM & )scitsitatS( CSM nassaH fiaS .rM

sraey 8 revOII AFC ,ACCA )gnitoV-noN( nahK rawraS .rM

Name




Category




(iv) PARTICULARS OF FUND MANAGERS

deganaM semehcS tnemtsevnI evitcelloC rehtOnoitacifilauQemaNMr. Saif Hassan MSC (stats) & MEF Faysal Balanced Growth Fund

Faysal Asset Allocation Fund

June 30, 2016 Rupees

(v) PERFORMANCE TABLE

380,306,291 stessa teN 89.59tinu rep eulav tessa teN 89.59ecirp reffO 89.59tinu rep ecirp esahcrupeR 60.901tinu rep ecirp reffo tsehgiH60.901tinu rep ecirp esahcruper tsehgiH88.001ecirp reffo tsewoL88.001tinu rep ecirp esahcruper tsewoL

%20.4-:nruter latoT%20.4-htworg latipac -

-noitubirtsid emocni -

Average annual return:(Launch date: Decemeber 13, 2010)

%20.4-raey eno -%20.4-sraey owt -%20.4-sraey eerht -

Distribution per unit:-)tinu rep %( noitubirtsid miretnI - -)tinu rep %( noitubirtsid laniF - -

(vi) Responsibilities towards Corporate Governance and Proxy Voting as per Regulation 38A

(vii) Expense ratio from the November 25, 2015 to June 30, 2016Faysal Islamic Asset Allocation Fund (FIAAF) has total expense ratio (TER) of 4.69%, the TER inlcudes 0.89% representing government levy and SECP fee.

The Fund's past performance is not necessarily indicative of future performance. Therefore, the unit pricesand investment returns may go down, as well as up.

Faysal Asset Management Limited (FAML) on behalf of Faysal Islamic Asset Allocation Fund (FIAAF) a collective investment scheme (CIS) under its management did not participate in shareholders’ meetings. Further, the proxy voting policy of the FIAAF is available on the website of the FAML and detailed information regarding actual proxies voted by the FAML (if any) in respect of the CIS is also available without charge, upon request, to all unit holders.



(vi) MEETINGS OF THE BOARD OF DIRECTORS

Meetings Sep 23 Oct 06 Oct 28 Feb 29 March 18 March 31 April 22 June 27Attended 2015 2015 2015 2016 2016 2016 2016 2016

111101117namriahC ,irasnA namuaN .rM

Mr. Osman Khan, Director 6 1 1 1 0 1 1 0 1

Mr. Zahid Ahmed, Director 4 N/A N/A N/A 1 1 1 1 0

Syed Ibad ur Rahman Chishti, Director 8 1 1 1 1 1 1 1 1

Mr. Razi ur Rahman, Director 8 1 1 1 1 1 1 1 1

Mr. Enamullah Khan, Chief Executive Officer 8 1 1 1 1 1 1 1 1

(vii) MEETINGS OF THE AUDIT COMMITTEE

Following is the analysis of the attendance in the meetings of the Audit Committee of the Management Company during the year:

Meetings Oct 06 Oct-27 Oct-28 Feb-26 Apr-22Attended 2015 2015 2015 2016 2016

Mr. Razi ur Rehman, Chairman 5 1 1 1 1 1

Mr. Osman Khan, Director 4 1 1 1 1 0

Syed Ibad ur Rahman Chishti, Director 5 1 1 1 1 1

(viii) MEETINGS OF THE BOARD HR COMMITTEE

Following is the analysis of the attendance in the meetings of the Board HR Committee of the Management Company during the year:

Meetings Oct 13 Oct 28 Dec 30 March 04Attended 2015 2015 2015 2016

Mr. Osman Khan, Chairman 4 1 1 1 1

11114rotceriD ,nahK namhaR ru izaR .rM

Syed Ibad ur Rahman Chishti, Director 4 1 1 1 1

Mr. Enamullah Khan, Chief Executive Officer 4 1 1 1 1

(ix) RATING OF THE FUND AND THE MANAGEMENT COMPANY


Following is the analysis of the attendance in the meetings of the Board of Directors of the Management Company during the year:

Name of DirectorsMeetings held on

Since the Fund was launched in September 2015, the stability ranking to the Fund is yet to be assigned and the JCR-VIS Credit Rating Company Limited (JCR-VIS) has awarded an "AM3++" asset manager rating to the Management Company as of May 04, 2016.

Name of MemberMeetings held on

Name of DirectorsMeetings held on

Annexure II


(iv) PARTICULARS OF FUND MANAGERS

deganaM semehcS tnemtsevnI evitcelloC rehtOnoitacifilauQemaNMr. Saif Hassan MSC (stats) & MEF Faysal Balanced Growth Fund

Faysal Asset Allocation Fund

June 30, 2016 Rupees

(v) PERFORMANCE TABLE

380,306,291 stessa teN 89.59tinu rep eulav tessa teN 89.59ecirp reffO 89.59tinu rep ecirp esahcrupeR 60.901tinu rep ecirp reffo tsehgiH60.901tinu rep ecirp esahcruper tsehgiH88.001ecirp reffo tsewoL88.001tinu rep ecirp esahcruper tsewoL

%20.4-:nruter latoT%20.4-htworg latipac -

-noitubirtsid emocni -

Average annual return:(Launch date: Decemeber 13, 2010)

%20.4-raey eno -%20.4-sraey owt -%20.4-sraey eerht -

Distribution per unit:-)tinu rep %( noitubirtsid miretnI - -)tinu rep %( noitubirtsid laniF - -

(vi) Responsibilities towards Corporate Governance and Proxy Voting as per Regulation 38A

(vii) Expense ratio from the November 25, 2015 to June 30, 2016Faysal Islamic Asset Allocation Fund (FIAAF) has total expense ratio (TER) of 4.69%, the TER inlcudes 0.89% representing government levy and SECP fee.

The Fund's past performance is not necessarily indicative of future performance. Therefore, the unit pricesand investment returns may go down, as well as up.

Faysal Asset Management Limited (FAML) on behalf of Faysal Islamic Asset Allocation Fund (FIAAF) a collective investment scheme (CIS) under its management did not participate in shareholders’ meetings. Further, the proxy voting policy of the FIAAF is available on the website of the FAML and detailed information regarding actual proxies voted by the FAML (if any) in respect of the CIS is also available without charge, upon request, to all unit holders.

Islamic Asset Allocation Fund

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