Annual report Cover - JPMorgan AMC Annual Report
Transcript of Annual report Cover - JPMorgan AMC Annual Report
SPONSOR
JPMorg an Asset Management (Asia) Inc.
270 Park Avenue, New York,
New York 10017, USA
TRUSTEE
JPMorg an Mutu al Fund India Private Limited
Registered office:
Kalpataru Synergy, 3rd Floor,
West Wing, Santacruz (East),
Mumbai 400 055,
India.
ASSET MANAGEMENT COMPANY
JPMorg an Asset Management India Private Limited
Registered office:
Kalpataru Synergy, 3rd Floor,
West Wing, Santacruz (East),
Mumbai 400 055,
India.
CUSTODIAN
Deutsche Bank AG,
Mumbai Branch,
Sir Hazarimal Somani Marg,
Fort, Mumbai 400 001,
India.
STATUTORY AUDITORS
Price Waterhou se
252, Veer Savarkar Marg,
Shivaji Park, Dadar (West),
Mumbai 400 028,
India.
REGISTRAR & TRANSFER AGENT
Deutsche Investor Services Private Limited
2nd Floor, Tower 1, Logitech Park,
M.V. Road, Saki Naka,
Andheri (East), Mumbai 400 072,
India.
BOARD OF DIRECTORS
JPMorg an Mutu al Fund India Private Limited.
1) Mr. Jagadish Salunkhe
2) Mr. P. G. R. Prasad
3) Dr. Dharmendra Bhandari
4) Mr. N. Balasubramanian
5) Mr. M. G. Bhide
6) Mr. Dominic E. Price [resigned, effective June 19, 2008]
JPMorg an Asset Management India Private Limited
1) Mr. Anthony J. Morgan
2) Mr. Krishnamurthy Vijayan
3) Mr. K. G. Vassal
4) Mr. D. N. Mungale
5) Mr. A. P. Kurian
6) Mr. T. P. Ostwal
1
Trustees’ Report for the year ended March 31, 2008
1) SCHEMES PERFORMANCE, FUTURE OUTLOOK AND OPERATIONSOF SCHEMES
From the date of inception till March 31, 2008 the Fund has launched twoEquity Schemes – JPMorgan India Equity Fund (“JPMIEF”) and JPMorganIndia Smaller Companies Fund (“JPMISCF”), a Liquid Scheme - JPMorganIndia Liquid Fund (“JPMILF”) and an Income Scheme - JPMorgan IndiaLiquid Plus Fund (“JPMILPF”).
a) Scheme Perform ance
JPMorg an Ind ia Equity Fund
JPMorgan India Equity underperformed the index by 258bps sinceinception.
Scheme Return s as on March 31, 2008
Scheme BSE – 200
Since Inception 9.15% 11.73%
--raeY 1
Note: Absolute returns of the growth option are computed. “Sinceinception” returns are calculated on Rs. 10/- invested at inception.Past performance may or may not be sustained in future.
JPMorg an India Smaller Comp anies Fund
JPMorgan India Smaller Companies Fund outperformed the indexby 242bps since inception.
Scheme Return s as on March 31, 2008
Scheme CNX – Mid Cap
Since Inception - 27.37% - 29.79%
--raeY 1
Note: Absolute returns of the growth option are computed. “Sinceinception” returns are calculated on Rs. 10/- invested at inception.Past performance may or may not be sustained in future.
JPMorg an India Liquid Fund
JPMorgan Liquid Fund has outperformed the Crisil Liquid Fund Indexby 62bps. This was because of high cash components and thus takingadvantage of tight liquidity condition in March’08.
Scheme Return s as on March 31, 2008
Scheme CRISIL LiquidFund Index
Since Inception 4.18% 3.56%
--raeY 1
Note: Absolute returns of the growth option are computed. “Sinceinception” returns are calculated on Rs. 10/- invested at inception.Past performance may or may not be sustained in future.
JPMorg an India Liquid Plus Fund
JPMorgan Liquid Fund Plus has outperformed the Crisil Liquid FundIndex by 90bps. This was because of high cash components andthus taking advantage of tight liquidity condition in March’08.
Scheme Return s as on March 31, 2008
Scheme CRISIL LiquidFund Index
Since Inception 4.46% 3.56%
--raeY 1
Note: Absolute returns of the growth option are computed. “Sinceinception” returns are calculated on Rs. 10/- invested at inception.Past performance may or may not be sustained in future.
JPMorgan Mutual Fund Ind ia Priva te LimitedKalpataru Synergy, 3rd Floor, West Wing, Santacruz (E),
Mumbai - 400 055
b) Futur e Out look
Going forward, efforts to achieve sustainable growth would continueto be made, by a strong focus over key constituents, namely, ourproducts, performance, processes and most importantly people. Inpartnership with our distributors we hope to grow our business at aconvenient pace for longer term growth and stability. Also, our outlookis very positive towards working along with our industry association,AMFI and our Regulators, to help raise the awareness levels of thepublic towards the mutual funds and thus accelerate the growth ofthis sector.
c) Operations of Schemes
With a view to safeguard the interests of investors, our constantendeavour will be towards evolving suitable product offerings, aswould suit investors needs, such as Systematic Investment Plans,Systematic Transfer Plans and so forth.
2) BRIEF BACKGROUND OF SPONSORS, TRUST, TRUSTEE CO. ANDAMC CO.
a) JPMorg an Asse t Management (Asia ) Inc. (Spon sor)
The Sponsor for JPMorgan Mutual Fund is JPMorgan AssetManagement (Asia) Inc. The Sponsor is a wholly-owned indirectsubsidiary of JPMorgan Chase & Co. and a part of the JPMorganChase Group. JPMorgan Chase is among the world’s leading globalfinancial services firms. The Sponsor serves as the holdingcompany for many Asian asset management businesses ofJPMorgan Chase and its principal activity is to undertake assetmanagement businesses through operating subsidiariesestablished for this purpose in the Asia Pacific region. The Sponsorholds 75% of the paid-up equity capital of the AMC. The balance25% is held by J.P. Morgan India Private Limited. J.P. Morgan IndiaPrivate Limited is a SEBI registered merchant banker, underwriter,a trading member of the capital market segments of the BSE andthe NSE and trading-cum-clearing member of the derivativessegments of the BSE and the NSE.
b) JPMorg an Mutu al Fund (Trust)
JPMorgan Mutual Fund (JPMMF) was set up as a Trust by theSettlers, JPMorgan Asset Management (Asia) Inc. on December4, 2006 with JPMorgan Mutual Fund India Private Limited (theTrustee Company) as a Trustee in accordance with the provisionsof the Indian Trust Act, 1882 and is duly registered under the IndianRegistration Act, 1908. The Trustee has entered into an InvestmentManagement Agreement dated December 6, 2006 with JPMorganAsset Management India Private Limited (the AMC) to function asthe Investment Manager for all the Schemes of JPMMF. JPMMFwas registered with SEBI on February 8, 2007.
c) JPMorg an Mutu al Fund Ind ia Priva te Limited (Trustee Co.)
JPMorgan Mutual Fund India Private Limited is a companyincorporated and registered under the provisions of the CompaniesAct, 1956 having its registered office at Kalpataru Synergy, 3rdFloor, West Wing, Santacruz - East, Mumbai 400 055. The TrusteeCompany acts as the Trustee of the JPMorgan Mutual Fund and isthe exclusive owner of the Trust Fund and holds the same in trustfor the benefit of the unitholders. The Trustee Company has beendischarging its duties and carrying out the responsibilities asprovided in the Regulations and the Trust Deed. The TrusteeCompany seeks to ensure that the Fund and the Schemes floatedthere under are managed by the AMC in accordance with the TrustDeed, the Regulations, directions and guidelines issued by theSEBI, the Association of Mutual Funds in India and other regulatoryagencies.
Trustees’ Report for the year ended March 31, 2008
d) JPMorgan Asset Management Ind ia Priva te Limited (AMC Co.)
JPMorgan Asset Management India Private Limited is a companyincorporated and registered under the provisions of the CompaniesAct, 1956 having its registered office at Kalpataru Synergy, 3rd Floor,West Wing, Santacruz - East, Mumbai 400 055. The AMC has beenappointed to act as an Asset Management Company for JPMorganMutual Fund (JPMMF), a mutual fund approved by the Securitiesand Exchange Board of India (SEBI), by way of an InvestmentManagement agreement dated December 6, 2006.
3) INVESTMENT OBJECTIVES OF THE SCHEMES
a) JPMorg an India Equity Fund
The investment objective of the Scheme is to generate income andlong-term capital growth from a diversified portfolio of predominantlyequity and equity-related securities including equity derivatives.However, there can be no assurance that the investment objectiveof the scheme will be realised.
b) JPMorg an India Smalle r Comp anies Fund
The investment objective is to seek to generate long term capitalappreciation from a portfolio that is substantially constituted of equityand equity related securities focused on smaller companies.Generally, the universe will be the companies constituting the bottomfourth by way of market capitalization of stocks listed on the NSE orthe BSE. The fund manager may from time to time include otherequity and equity related securities outside the universe to achieveoptimal portfolio construction. However, there can be no assurancethat the investment objective of the scheme will be realised.
c) JPMorg an Ind ia Liquid Fund
The investment objective of the Scheme is to provide reasonablereturns, commensurate with low risk while providing a high level ofliquidity, through a portfolio of money market and debt securities.However, there can be no assurance that the investment objectivesof the Scheme will be realised.
d) JPMorg an Ind ia Liquid Plus Fund
The investment objective is to provide liquidity and optimal returns tothe investors by investing primarily in a mix of short-term debt andmoney market instruments which results in a portfolio havingmarginally higher maturity and moderately higher credit risk ascompared to a liquid fund, at the same time maintaining a balancebetween safety and liquidity.
However, there can be no assurance that the investment objectiveof the Scheme will be realised.
4) ACCOUNTING POLICIES
All accounting policies are in accordance with Securities Exchange Boardof India (Mutual Fund) Regulations 1996.
5) UNCLAIMED DIVIDENDS & REDEMPTIONS
Summary of No. of Investors & Corresponding amount Scheme-wise
Unclai med Unclai medDivi dends Redempt ions
Amount No . of Amount No . ofScheme (Rs.) Inves tor s (Rs.) Inves tor s
JPMorgan India 18.30Equity Fund NIL NIL Lakhs 39
JPMorgan IndiaLiquid Fund NIL NIL NIL NIL
JPMorgan IndiaLiquid Plus Fund NIL NIL NIL NIL
Note: Reminder letters have been sent to the investors on variousoccasions, with regard to unclaimed redemptions.
6) STATUTORY INFORMATION
a) The Sponsors are not responsible or liable for any loss resultingfrom the operation of the Schemes of the Fund beyond their initialcontribution (to the extent contributed) of Rs. 1,00,000/- for settingup the Fund, and such other accretions / additions to the same.
b) The price and redemption value of the units, and income from them,can go up as well as down with fluctuations in the market value of itsunderlying investments.
c) Full Annual Report shall be disclosed on the website(www.jpmorganmf.com) and shall be available for inspection at theHead Office of the mutual fund. Present and prospective unit holdercan obtain copy of the trust deed, the full Annual Report of the Fund/ AMC at a price.
For JPMorg an Mutu al Fund India Priva te Limited
Sd/-Mr. Jagadish SalunkheChairman
Place: MumbaiDate: September 29, 2008
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1
Auditors’ ReportTo
The TrusteeJPMORGAN MUTUAL FUND
1. We have audited the Balance Sheet of JPMorgan Mutual Fund – JPMorgan India Equity Fund (“The Scheme”) as at March 31, 2008,the related Revenue Account for the period April 19, 2007 to March 31, 2008 and the Cash Flow Statement for the period April 19, 2007to March 31, 2008 which we have signed under reference to this report. These financial statements are the responsibility of Trusteeof JPMorgan Mutual Fund and the Management of JPMorgan Asset Management India Private Limited (the “Management”). Ourresponsibility is to express an opinion on these financial statements based on our audit.
2. We have conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we planand perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. Anaudit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Ourprocedures included confirmation of securities owned at March 31, 2008 by correspondence with the custodian and others. An auditalso includes assessing the accounting principles used and significant estimates made by the management, as well as evaluating theoverall financial statements presentation. We believe that our audit provides a reasonable basis for our opinion.
3. We have obtained all the information and explanations which, to the best of our knowledge and belief, were necessary for the purposesof our audit. The Balance Sheet, the Revenue Account and the Cash Flow Statement referred to above are in agreement with the booksof account of the Scheme.
4. In our opinion and to the best of our information and according to the explanations given to us;
(i) The Balance Sheet, the Revenue Account and the Cash Flow Statement together with the notes thereon give the informationrequired by the Securities and Exchange Board of India (Mutual Funds) Regulations, 1996 and the amendments thereto, asapplicable, and also give respectively a true and fair view of the state of affairs of JPMorgan Mutual Fund – JPMorgan IndiaEquity Fund as at March 31, 2008 its net surplus for the period April 19, 2007 to March 31, 2008 and its cash flows for the periodApril 19, 2007 to March 31, 2008.
(ii) The Balance Sheet as at March 31, 2008, and the Revenue Account for the period April 19, 2007 to March 31, 2008, together withthe notes thereon, have been prepared in all material respects in accordance with the accounting policies and standardsspecified in the Ninth Schedule of the Securities and Exchange Board of India (Mutual Funds) Regulations, 1996 and amendmentsthereto, as applicable.
(iii) The methods used to value
(a) Privately placed debt securities in good faith and
(b) Non traded and thinly traded debt securities in accordance with the guidelines for valuation of securities for mutual fundsdated September 18, 2000 and amendments thereto, as applicable, issued by the Securities and Exchange Board of Indiaas at March 31, 2008 as determined by JPMorgan Asset Management India Private Limited under procedures approved bythe Trustee of JPMorgan Mutual Fund are fair and reasonable.
K. H. VachhaPartnerMembership No. F/30798
For and on behalf of
PRICE WATERHOUSEChartered Accountants
MumbaiSeptember 29, 2008
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Balance Sheet as at March 31, 2008March 31, 2008
Schedule Rupees
ASSETS
Investments 1 9,987,493,088
Deposits 2 352,100,000
Other Current Assets 3 255,715,222
TOTAL 10,595,308,310
LIABILITIES
Unit Capital 4 9,990,073,861
Reserves and Surplus 5 493,031,231
Current Liabilities and Provisions 6 112,203,218
TOTAL 10,595,308,310
March 31, 2008 March 31, 2008 March 31, 2008RECONCILIATION OF NET ASSET VALUE PER UNIT Growth Opt ion Divi dend Opt ion Tot al
Rupees Rupees Rupees
Net Assets as per Balance Sheet (Total Assets less CurrentLiabilities and Provisions ) (Note 2.7) 4,985,949,563 5,497,155,529 10,483,105,092
Number of Units in Issue 456,816,456.899 542,190,929.241
Net Asse t Value per Unit 10.915 10.139
Notes to the Financial Statements 8
The Schedules referred to herein form an integral part of the Financial Statements.
This is the Balance Sheet referred to in our report of even date.
K. H. VACHHA Fo r and on behalf of Fo r and on behalf ofPartner JPMorgan Asset JPMorgan Mutu al Fund
Management Ind ia Priva te Limi ted Ind ia Priva te Limi ted
For and on behalf of
PRICE WATERHOUSE Mr. Kris hn amurth y Vijaya n Mr. Jagadish SalunkheChartered Accountants Whole-time director and CEO Chairman
Mr. K. G. Vassal Dr. Dharmendra BhandariDirector Director
Place : Mumbai Mr. Harshad M PatwardhanDate : September 29, 2008 Head - Equity and Fund Manager
3
Cash Flow Statementfor the period April 19, 2007 to March 31, 2008
April 19, 2007 toMarch 31, 2008
Rupees
A. Cashf low from Operating Activi ty
Net Surplus for the period 932,948,318
Adjustments for:-
(Increase)/Decrease in Investments at cost (10,509,069,335)
(Increase)/Decrease in Other Current Assets (18,310,026)
Increase/(Decrease) in Current Liabilities 96,524,095
Net cash used in operations ( A ) (9,497,906,948)
B Cashf low from Financing Activi ties
Increase/(Decrease) in Unit Capital 9,990,073,861
Increase/(Decrease) in Unit Premium Reserve 573,666,786
Adjustments for:-
Increase/(Decrease) in Redemption Payable for Units Redeemed by Investors 15,679,122
(Increase)/Decrease in Subscription Receivable for Units Issued to Investors (23,044,845)
Dividend Distribution (492,600,720)
Net cash generated from financing activi ties ( B ) 10,063,774,204
Net Increase/ (Decrease ) in Cash and Cash Equ ivale nts (A+B) 565,867,256
Cash and Cash Equivalents as at the beginning of the period -
Cash and Cash Equivalents as at the close of the period 565,867,256
Notes :
March 31, 2008Rupees
1. Cash and Cash Equivalents include the following :
Balances with Scheduled Banks :
- In Current Account 43,219,884
- In Deposit Account 350,000,000
Other Collaterised Lending
Reverse Repos 69,448,944
Margin Deposit with Clearing Corporation of India Limited towardsCollateralised Borrowing and Lending Obligation 2,100,000
Derivative Margin Deposit 101,098,428
565,867,256
2. The above Cash Flow Statement has been prepared under the “Indirect Method” set out in Accounting Standard - 3 on Cash FlowStatements, issued by The Institute of Chartered Accountants of India.
This is the Cash Flow Statement referred to in our report of even date.
K. H. VACHHA Fo r and on behalf of Fo r and on behalf ofPartner JPMorgan Asset JPMorgan Mutu al Fund
Management Ind ia Priva te Limi ted Ind ia Priva te Limi ted
For and on behalf of
PRICE WATERHOUSE Mr. Kris hnamurth y Vijaya n Mr. Jagadish SalunkheChartered Accountants Whole-time director and CEO Chairman
Mr. K. G. Vassal Dr. Dharmendra BhandariDirector Director
Place : Mumbai Mr. Harshad M PatwardhanDate : September 29, 2008 Head - Equity and Fund Manager
4
Revenue Account for the period April 19, 2007 to March 31, 2008
April 19, 2007 toMarch 31, 2008
Schedule Rupees
INCOME AND GAINS
Dividends (Note 2.4) 54,200,447
Interest and Discount 7 36,932,805
Net Profit on Sale of Investments and Derivatives(Net of Net Loss on Inter Scheme Sale of Investments Rs.91,952) (Note 2.3) 1,025,148,076
Miscellaneous Income (Note 10) 869,257
TOTAL 1,117,150,585
EXPENSES AND LOSSES
Investment Management and Advisory Fees (Note 4) 92,622,706
Transfer Agent Fees and Expenses 13,311,546
Trusteeship Fees and Expenses (Note 5) 4,520,617
Custodian Fees and Expenses (Note 6) 2,586,316
Audit Fees 1,215,000
Selling and Distribution Expenses 64,016,797
Other Operating Expenses 5,929,285
TOTAL (Note 11 (b)) 184,202,267
Net Surplus fo r the Peri od 932,948,318Net Unrealised Depreciation in Value of Investments (525,059,163)
Net Surplus incl ud ing Net Unrealise d Deprecia tion in Value of Inves tments 407,889,155
RECONCILIATION OF NET ASSET VALUE PER UNIT
Ap ril 19, 2008 to Ap ril 19, 2008 to Ap ril 19, 2008 toMarch 31, 2008 March 31, 2008 March 31, 2008Growth Opt ion Divi dend Opt ion Tot al
Rupees Rupees Rupees
Net Surplus for the Period Including Net Unrealised Depreciation inthe value of Investments by Option 17,067,945 390,821,210 407,889,155
Transfer from Income Equalisation Reserve (Note 2.9) 117,904,936 36,453,849 154,358,785
Dividend Distribution - (492,600,720) (492,600,720)
Balance transferred to Reserve Fund 134,972,881 (65,325,661) 69,647,220
Notes to the Financial Statements 8
The Schedules referred to herein form an integralpart of the Financial Statements
This is the Revenue Account referred to in our report of even date.
K. H. VACHHA Fo r and on behalf of Fo r and on behalf ofPartner JPMorgan Asset JPMorgan Mutu al Fund
Management Ind ia Priva te Limi ted Ind ia Priva te Limi ted
For and on behalf of
PRICE WATERHOUSE Mr. Kris hnamurth y Vijaya n Mr. Jagadish SalunkheChartered Accountants Whole-time director and CEO Chairman
Mr. K. G. Vassal Dr. Dharmendra BhandariDirector Director
Place : Mumbai Mr. Harshad M PatwardhanDate : September 29, 2008 Head - Equity and Fund Manager
5
Schedules forming part of the Balance Sheetfor the period April 19, 2007 to March 31, 2008
SCHEDULE 1 March 31, 2008 March 31, 2008Marke t/Fair Val ue Cost
Rupees Rupees
Investments(Notes 2.2, 2.3,7,8,9 and 12)(Refer to the attached Statement of Portfolio Holding as at March 31, 2008)
Equity Shares 9,310,339,227 9,834,754,944
Privately Placed Non-Convertible Debentures / Bonds 400,414,442 401,057,887
Certificate of Deposit 276,739,419 276,739,419
TOTAL 9,987,493,088 10,512,552,250
SCHEDULE 2 March 31, 2008Rupees
Deposits
Deposits with Scheduled Bank(Under Lien Towards Margin Deposit for Equity Derivatives) 350,000,000
Margin Deposit with Clearing Corporation of India towards CollateralizedBorrowing and Lending Obligation 2,100,000
TOTAL 352,100,000
SCHEDULE 3 March 31, 2008Rupees
Other Current Asse ts
Balances with Banks - in Current Account 43,219,884Sales Contracts Awaiting Completion - Equity Shares 593,095Reverse Repos 69,448,944Unit Subscriptions Receivable 15,984,265Inter-Scheme Receivable– For Switch - In 7,060,580– For Others 243,473Derivative Margin Deposit (Note 2.5) 101,098,428Interest Receivable– Debentures / Bonds 16,662,797– Reverse Repos 12,843– Deposits 637,671Miscellaneous 753,242
TOTAL 255,715,222
SCHEDULE 4 March 31, 2008Rupees
Unit Capital
Growth Opt ion
Issued and Subscri bed :
Units of Rs.10 each fully paid up 3,296,609,696 329,660,969.636
Outstanding:Initial Issue and Subscription 3,296,609,696 329,660,969.636
Issued during the period 3,151,878,309 315,187,830.841
6,448,488,005 644,848,800.477
Redeemed during the period 1,880,323,436 188,032,343.578
At the end of the period 4,568,164,569 456,816,456.899
Dividend OptionIssued and Subscri bed :
Units of Rs.10 each fully paid up 4,605,511,986 460,551,198.617
Outstanding:
Initial Issue and Subscription 4,605,511,986 460,551,198.617
Issued during the period 2,586,506,753 258,650,675.340
7,192,018,739 719,201,873.957
Redeemed during the period 1,770,109,447 177,010,944.716
At the end of the period 5,421,909,292 542,190,929.241
TOTAL 9,990,073,861 999,007,386.140
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Schedules forming part of the Balance Sheetfor the period April 19, 2007 to March 31, 2008SCHEDULE 5
Growth Opt ion Divi dend Option Tot alMarch 31, 2008 March 31, 2008 March 31, 2008
Rupees Rupees Rupees
Reserves a nd Surplus
Unit Premium Reserve (Note 2.8)
Added during the period 279,807,617 139,500,384 419,308,001
At the end of the period 279,807,617 139,500,384 419,308,001
Income Equalisa tion Reserve (Note 2.9)
Added during the period 117,904,936 36,453,849 154,358,785
Transferred to Revenue Account (117,904,936) (36,453,849) (154,358,785)
At the end of the period - - -
Unrealise d App recia tion ReserveNet Unrealised Appreciation in Value of Investments and Derivatives 3,004,496 1,071,514 4,076,010
At the end of the period 3,004,496 1,071,514 4,076,010
Reserve Fund
Balance Transferred from Revenue Account 134,972,881 (65,325,661) 69,647,220
At the end of the period 134,972,881 (65,325,661) 69,647,220
TOTAL 417,784,994 75,246,237 493,031,231
SCHEDULE 6
Current Liabili ties and Provisi ons March 31, 2008Rupees
Current Liabili ties
Investment Management and Advisory Fees 8,236,702
Transfer Agent Fees and Expenses 3,281,878
Trusteeship Fees and Expenses 407,112
Custodian Fees and Expenses 255,096
Audit Fees 1,215,000
Selling and Distribution Expenses 9,429,064
Unit Redemptions Payable 12,947,878
Inter Scheme Payable - For Switch - Out 2,731,244
Dividend Payable 4,694
Payable to Investment Manager 14,733,917
Load (Note 2.10) 30,367,833
Payable for Outstanding Futures Contracts 21,776,595
Unclaimed Redemption (Note 16) 1,830,285
Sundry Payables 4,985,920
TOTAL 112,203,218
April 19, 2008 toMarch 31, 2008
RupeesSCHEDULE 7Interest and Disc ount(Not e 2.4)
Debentures / Bonds 20,189,188
Commercial Paper / Certificate of Deposit 5,525,782
Reverse Repos 3,971,735
Collateralized Borrowing and Lending Obligation 6,231,811
Margin Deposit with the Clearing Corporation of India Limited 376,618
Deposits 637,671
TOTAL 36,932,805
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Statement of Portfo lio Holdingas at March 31, 2008(Referred to in Schedule 1 to the Balance Sheet as at March 31, 2008 and the Revenue Account fo r the period April 19, 2007 toMarch 31, 2008)
Descri pt ion Quant ity Marke t /Fair Val ueRupees
EQUITY SHARES (93.22%)
AUTO (2.13%)
Maruti Suzuki India Ltd. 239,866 198,369,182
AUTO ANCILLAR IES (0.63%)
Asahi India Glass limited 879,602 58,845,374
BANK S (8.98%)
HDFC Bank Ltd.@ 184,920 246,174,750
State Bank of India 129,887 207,851,672
Axis Bank Limited 248,444 196,233,493
ICICI Bank Ltd. 241,762 186,011,683
CEMENT (2.10%)
Grasim Industries Ltd. 75,929 195,539,954
CONSTRUCTION (6.37%)
Jaiprakash Associates Ltd. 925,869 209,755,622
Punj Lloyd Ltd. 643,962 200,143,390
DLF Limited 198,815 128,384,786
Mahindra Lifespace Developers Ltd. 131,761 54,542,466
CONSUMER DURABL ES (1.44%)
Voltas Ltd. 747,214 134,236,995
CONSUMER NON DURABL ES (4.06%)ITC LTD 1,832,164 377,883,825
DIVERSIFIED (3.82%)
Larsen & Toubro Ltd.@ 117,197 355,804,232
FERROUS METALS (2.44%)
Jindal Steel & Power Ltd. 109,949 227,594,430
FINANCE (12.16%)Housing Development Finance Corporation Ltd.@ 278,581 662,953,135
Reliance Capital Ltd. 132,415 162,711,552
Infrastructure Development Finance Company Ltd.@ 1,026,584 155,014,184
Shriram Transport Finance Co Ltd. 450,000 151,920,000
GAS (0.88%)
Indraprastha Gas Limited 623,416 81,729,838
INDUSTRIAL CAPITAL GOODS (9.57%)
Bharat Heavy Electricals Ltd. 180,005 371,053,307
ABB Ltd. 126,623 149,408,809
Bharati Shipyard Ltd. 191,114 103,966,016
Elecon Engineering Ltd. 527,288 103,691,185
Crompton Greaves Ltd. 315,390 86,874,176
Suzlon Energy Ltd. 286,905 75,685,539
INDUSTRIAL PRODUCTS (4.34%)
Sintex Industries Ltd. 518,361 184,147,745
Max India Limited 885,000 131,201,250
Jain Irrigation Systems Ltd. 150,000 88,800,000
MINERALS/MINING (3.04%)
Gujarat NRE Coke Ltd 1,064,201 146,912,948
Sesa Goa Ltd. 43,096 135,819,199
NON - FERROUS METALS (1.56%)Sterlite Industries Ltd. 203,838 145,642,251
OIL (4.39%)
Oil & Natural Gas Corporation Ltd. 416,382 408,283,370
PETROLEUM PRODUCTS (7.01%)
Reliance Industries Ltd. 287,967 652,475,629
PHARMACEUTICALS (6.69%)Jubilant Organosys Limited 683,502 224,086,131
Divis Laboratories Ltd. 146,479 185,859,879
Sun Pharmaceutical Industries Ltd. 113,620 139,678,747
Biocon Limited 170,552 73,422,636
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Statement of Portfo lio Holding (Continued)as at March 31, 2008(Referred to in Schedule 1 to the Balance Sheet as at March 31,2008 and the Revenu e Account for the peri od April 19, 2007 to March31, 2008)
Descri pt ion Quant ity Marke t /Fair Val ueRupees
POWER (5.24%)
Jyoti Structures Ltd. 894,728 143,022,271
Tata Power Co. Ltd. 113,513 132,980,480
NTPC Ltd. 591,593 116,307,184
Reliance Energy Ltd. 76,613 95,831,371
SOFTWARE (6.95 %)
Educomp Solutions Ltd. 56,402 215,678,428
Infosys Technologies Ltd. 120,277 173,186,852
Satyam Computers Ltd. 271,711 107,692,655
Financial Technologies India 50,762 81,176,052
Everonn Systems India Limited 118,115 69,020,500
TELECOM - SERVICES (6.19%)
Bharti Airtel Ltd. 446,431 368,863,614
Reliance Communications Ltd 407,789 207,870,443
Total (Cost Rs. 9,834,754,944) 9,310,339,227
PRIVATELY PLACED NON CONVERTIBLE DEBENTURES/BONDS (4.01%)FINANCE (100 %)
9.13% First Leasing Co Ltd (30/04/2008)* 2,000,000 200,215,868
8.87% Magma Shrachi Finance Ltd (20/05/2008)* 2,000,000 200,198,574
Total (Cost Rs. 401,057,887) 400,414,442
CERTIFICATE OF DEPOSIT (2.77%)BANK S (100 %)
State Bank Of Travancore (03/10/2008)# 2,500,000 240,296,285
ICICI Bank Ltd. (17/02/2009)# 390,000 36,443,134
Total (Cost Rs. 276,739,419) 276,739,419
Total Inves tments (Cost Rs. 10,512,552,250) 9,987,493,088
EQUITY DERIVATIVES
LONG FUTURES (80.24%)
JINDAL STEEL & POWER LIMITED (FV Rs 5/-) APRIL 2008 FUTURE 51,200 106,150,400
RELIANCE INDUSTRIES LIMITED APRIL 2008 FUTURE 45,000 102,123,000
RELIANCE CAPITAL LIMITED APRIL 2008 FUTURE 76,176 93,932,626
Axis Bank Limited APRIL 2008 FUTURE 71,550 56,345,625
BHARAT HEAVY ELECTRICALS LIMITED APRIL 2008 FUTURE 21,975 45,239,933
403,791,583
SHORT FUTURES (19.76%)NTPC Limited APRIL 2008 FUTURE 208,000 41,038,400
HDFC BANK APRIL 2008 FUTURE 44,200 58,377,150
99,415,550
Total 503,207,133
FIXED DEPOSITS
BANK S (100%)
9.25% Centurion Bank Of Punjab Ltd. (24/06/2008)
Duration Rs. % to Net Assets
91 days 350,000,000 3.34%
Confirmation has been received from Deutsche Bank AG, Mumbai Branch at the end of financial period for investments held by them
* Fair value of privately placed securities as determined in good faith by JPMorgan Asset Management India Private Limited underprocedures approved by the Trustee.
# Fair value of non-traded and thinly traded debt securities as determined JPMorgan Asset Management India Private Limited underprocedures approved by the Trustee in accordance with the guidelines for valuation of securities for mutual funds dated September 18, 2000and amendments thereto as applicable issued by the Securities and Exchange Board of India.
@ Investment in companies which have invested more than 5% of the net asset value of any scheme of JPMorgan Mutual Fund.
9
Annexure 1Discl osure und er Regulation 25 (11) of the Securi ties and Exchange Board of Ind ia (Mutu al Fund s) Regu lations 1996 as amended.
JPMorgan Mutu al Fund has made fo llowing investments in companies or their s ubsidiaries w hich ho ld units in excess of 5% of the netasset value of any sc heme of JPMorgan Mutu al Fund fo r the period ended March 31, 2008.
Rupees
Name o f the Company Schemes Invested in by the Company Investments made by the Schemes of Agg regated for the OutstandingJPMorgan Mutual Fund in the Company or Period under as on March 31, its Subsidiary Regulation 25(11) 2008 at Market /
at Cost Fair Value
DSP Merrill Lynch Capital Limited JPMorgan India Liquid Fund JPMorgan India Equity Fund 817,500,000 -
JPMorgan India Liquid Fund 1,619,110,100 -
JPMorgan India Liquid Plus Fund 2,756,549,938 -
JPMorgan India Smaller Companies Fund 192,000,000 -
Finolex Cables Limited JPMorgan India Liquid Plus Fund JPMorgan India Equity Fund 410,781,693 -
JPMorgan India Smaller Companies Fund 500,000,000 -
Global Trade Finance Limited JPMorgan India Liquid Plus Fund JPMorgan India Smaller Companies Fund 500,000,000 -
HDFC Bank Limited JPMorgan India Liquid Plus Fund JPMorgan India Equity Fund 333,203,752 246,174,750
JPMorgan India Liquid Fund JPMorgan India Smaller Companies Fund 147,381,657 -
Housing Development Finance JPMorgan India Liquid Fund JPMorgan India Equity Fund 960,590,509 662,953,135Corporation Limited
JPMorgan India Smaller Companies Fund 233,165,914 -Infrastructure Development Finance JPMorgan India Liquid Fund JPMorgan India Equity Fund 191,326,192 155,014,184Company Limited JPMorgan India Liquid Plus Fund
Larsen and Toubro Limited JPMorgan India Liquid Fund JPMorgan India Equity Fund 957,833,357 355,804,232
JPMorgan India Liquid Plus Fund JPMorgan India Smaller Companies Fund 281,970,666 -
LIC Housing Finance Limited JPMorgan India Liquid Plus Fund JPMorgan India Liquid Plus Fund 100,000,000 100,090,340
Tata Consultancy Services Limited JPMorgan India Liquid Plus Fund JPMorgan India Equity Fund 204,243,470 -
10
Schedu les fo rming part of the Balance Sheet as at March 31, 2008 andthe Revenue Account fo r the period April 19,2007 to March 31, 2008
Schedule 8Notes to the Financial S tatements1 Organisation
JPMorgan India Equity Fund (the”Scheme”) is an open-ended equity growth scheme of JPMorgan Mutual Fund (the “Fund”) and waslaunched on April 19, 2007. JPMorgan Mutual Fund has been sponsored by JPMorgan Asset Management (Asia) Inc. JPMorgan AssetManagement India Private Limited incorporated under the Companies Act, 1956 has been appointed as the asset managementcompany. The duration of the Scheme is perpetual. The Scheme closed for initial sunscription on May 18, 2007 and reopened for issueand redemption of units on June 14, 2007. The investment objective of the Scheme is to generate income and long-term capital growthfrom a diversified portfolio of predominantly equity and equity-related securities including equity derivatives. The Scheme has twooptions - Growth and Dividend Option.The Scheme will not declare dividend under the Growth Option in normal circumstances. Theincome earned on such units will remain invested within the Scheme and will be reflected in the net asset value.
2 Sign ificant Account ing Policies
2.1 Basis O f Account ing
The Scheme maintains its books of account on an accrual basis. These financial statements have been prepared in accordancewith the accounting policies and standards spcecified in the Ninth Schedule of the Securities and Exchange Board ofIndia(SEBI)(Mutual Funds) Regulations, 1996 (“the Regulation”) and amendments thereto, as applicable.
2.2 Portfo lio Valuation
Investments are stated at market / fair value at the Balance Sheet date / date of determination. In valuing the Scheme’sinvestments:
(i) Equity securities listed on a recognised stock exchange are valued at the last quoted closing price on the National StockExchange of India Limited (NSE). If on a particular valuation date, a security is not traded on NSE, the value at which it istraded on Bombay Stock Exchange Limited (BSE) is used. If no sale is reported at that time, the last quoted closing priceon the principal stock exchange on which the securtity is traded is used when it is not more than thirty days prior to thevaluation date.
(ii) Non-traded and thinly traded equity securities including those not traded within thirty days prior to the valuation date arevalued at fair value as determined by JPMorgan Asset Management India Private Limited under procedures approved by theTrustee of JPMorgan Mutual Fund in accordance with the guidelines for valuation of securities for mutual funds datedSeptember 18, 2000 and amendments thereto, as applicable, issued by the Securities and Exchange Board of India (SEBI).
(iii) Debt securities listed on a recognised stock exchange are valued at the last quoted closing price on the NSE. If no saleis reported at that time, such security is valued at fair value as determined in good faith by JPMorgan Asset ManagementIndia Private Limited under procedures approved by the Trustee of JPMorgan Mutual Fund.
(iv) Non-traded and thinly traded debt securities are valued at fair value as determined by JPMorgan Asset Managament IndiaPrivate Limited under procedures approved by the trustee of JPMorgan Mutual Fund in accordance with the guidelines forvaluation of securities for mutual funds dated September 18, 2000 and amendments thereto, as applicable, issued by theSecurities and Exchanges Board of India (SEBI).
(v) Privately placed debt securities are valued at fair value as determined in good faith by JPMorgan Asset Management IndiaPrivate Limited under procedures approved by the Trustee of JPMorgan Mutual Fund
(vi) Instruments bought on ‘repo’ basis are valued at the resale price after deduction of applicable interest up to the date ofresale.
(vii) Traded money market securities are valued at the yield at which they are traded on the valuation date. If no sale is reportedat that time, such security is valued at the last traded price plus accretion of the difference between the face value andthe last traded price. Non traded money market instruments are valued at cost plus accrued interest.
(viii) Units in mutual fund are valued at the net asset value of the investee schemes.
Following the issue of the guidance note on accounting for investments in the financial statements of mutual funds by theInstitute of Chartered Accountants of India (pursuant to the Eleventh Schedule of the Regulations) net unrealisedappreciation / depreciation in the value of investments is determined separately for each category of investments.Furtherin respect of each category of investments, the net change in the unrealised appreciation if any, between two balancesheet dates / valuation dates is accounted through the Unrealised Appreciation Reserve and net depreciation if any, isaccounted through the Revenue Account.
Unrealised appreciation is reduced from the distributable income at the time of income distribution.
2.3 Securi ties Transac tions
Investment securities transactions are accounted for on a trade date basis. The Scheme uses the average cost method fordetermining the reliased gain or loss on sale of investments
2.4 Inves tment Income
Interest and dividend income are recorded on an accrual basis.
2.5 Deriva tives
The Scheme enters into derivatives transactions in equity/index futures for the purpose of hedging and portfolio balancing.‘Derivatives margin deposit’ representing the margin towards equity derivative contracts entered into by the Schemes isdisclosed under ‘Other Current Assets’.
Futu res
Futures contracts are marked to market daily at the futures settlement price as determined by the exchange. The variation margin
11
calculated as the difference between the trade price or the previous day’s settlement price, as the case may be, and the currentday’s settlement price is recorded as a receivable or payable.
When a contract is closed (squared-off) / settled (on expiry), the difference between the final settlement / square-off price andthe contract price is recognised in the Revenue Account. If more than one futures contracts in respect of the same stock / indexand expiry date, to which the squared-off / settled contract pertains, is outstanding at the time of square-off / settlement of thecontract, the average method is followed for determining the gain/loss.
As at the Balance Sheet date / date of determination, all open futures positions are valued at the futures settlement price asdetermined by the exchange where it is traded. Non-traded futures contract are valued at fair value as per procedures /determined by JPMorgan Asset Management India Private Limited and approved by the Trustee. The unrealised appreciation /depreciation on all open positions is considered for determining the net assets value.
2.6 Initial Iss ue Expenses
Initial issue expenses upto 2.25% of the amount mobilised during the new fund offering period was borne from the entry loadcollected from the investors during the new fund offering period. Expenses over and above the applicable entry load were borneby the asset management company.
2.7 Net Asse t Value fo r Growth / Divi dend Opt ion
The net asset value of the units of the Scheme is determined separately for the units issued under Growth and Dividend Option.
For reporting the net asset value for the Options, daily income earned, including realised and unrealised gain or loss in the valueof investments and expenses incurred by the Scheme are allocated to the Options in proportion to the value of the unitsoutstanding.
2.8 Unit Premium Reserve
Upon issue and redemption of units, the net premium or discount to the face value of units is adjusted against the unit premiumreserve of the Scheme, after an appropriate portion of the issue proceeds and redemption payout is credited or debitedrespectively to the income equalization reserve.
The unit premium reserve is available for dividend distribution except to the extent it is represented by unrealised net appreciationin value of investments.
2.9 Income Equalization Reserve
The net distributable income relating to units issued / repurchased is transferred to / from income equalisation reserve fordetermining the net surplus / deficit, transferred from / to unit premium reserve.
2.10 Load
Load collected is retained under a separate account in the Scheme and is utilized to meet the selling and distribution expensesof the Scheme.
3. Income Taxes
No provision for taxation has been made as the Scheme qualifies as a recognised mutual fund under Section 10 (23D) of the Incometax Act, 1961 of India.
4. Investment Management Fees
The Scheme has paid or provided for investment management and advisory fees payable to JPMorgan Asset Management India PrivateLimited for managing the Scheme at an average annual rate of 1.02% of the average daily net asset values recorded by the Scheme.All costs, charges and expenses incurred by JPMorgan Asset Management India Private Limited in the administration and executionof the activities of the Scheme, except costs allowed to be charged to the Scheme under the Regulations are on their own account forwhich they receive investment management and advisory fees.
5. Trustee Fees
In accordance with the Trust Deed dated December 4,2006 between JPMorgan Asset Management (Asia) Inc. (the “Settlor”) andJPMorgan Mutual Fund India Private Limited (the Trustee), the Scheme has paid or provided for trustee fees payable to the Trusteeat the rate of 0.05% of the average daily net asset values recorded by the Scheme of the Fund or Rs. one crore per annum, whicheveris lower.
6. Custod ian Fees
Deutsche Bank AG, Mumbai Branch provides custodial services to the Scheme for which it receives custody fees.
7. Agg regate App recia tion And Deprecia tion In Value Of Investments
Aggregate appreciation and depreciation in the value of investments is as follows:
March 31, 2008Rupees
Equity Shares
- Appreciation 521,087,583
- Depreciation 1,045,503,301
Privately Placed Non Convertible Debentures / Bonds
- Appreciation -
- Depreciation 643,445
Equity Futures
- Appreciation 4,076,010
- Depreciation -
8. Agg regate Fair Val ue of Non-Traded Inves tments
Aggregate fair value of non-traded (including privately placed) investments as determined by JPMorgan Asset Management IndiaPrivate Limited under the procedures approved by the Trustee as at March 31,2008 is Rs.677,153,861.
12
9. Aggregate Value Of Purchases And Sales Of Inves tments
The aggregate value of investment securities purchased and sold (including matured) during the financial period is Rs. 39,366,684,713(excluding accretion of discount Rs. 11,757,592) and Rs. 29,915,685,374 respectively being 436.12% (annualised) and 331.42%(annualised) of the average daily net assets.
10. Miscella neous Income
Miscellaneous Income Rs. 869,257 represents amount received from JPMorgan Asset Management India Private Limted on accountof delayed recording of unit capital transactions calculated as the difference between the net asset value on the date of recording andthe transaction date.
11. Income / Expenses
(a) The total Income (including net profit on sale of investments and derivatives and net unrealised depreciation in the value ofinvestments) and total expenses is Rs. 592,091,422 and Rs. 184,202,267 respecively being 6.56% (annualised) and 2.04%(annualised) of the average daily net assets.
(b) The expenses have been accrued from the date of closure of the new fund offering period.
12. Discl osure Under Regu lation 25(11) Of The Securi ties And Exchange Bo ard Of Ind ia (Mutu al Fund s) Regu lations, 1996, AsAmended
JPMorgan Mutual Fund has made investments in companies, which hold / have held units in excess of 5% of the net asset value ofany scheme of JPMorgan Mutual Fund which have been listed in Annexure I.
13. Equ ity Deriva tives Discl osures
Futu res
Details of open interest in equity futures of April 2008 Series as at March 31, 2008 is as follows :
Underlyi ng Asse t Name Number of Cont rac ts Units Outstanding
Short Long
Bharat Heavy Electricals Limited 293 21,975
HDFC Bank 221 (44,200)
Jindal Steel & Power Limited (Fv Rs 5/-) 320 51,200
NTPC Limited 128 (208,000)
Reliance Capital Limited 552 76,176
Reliance Industries Limited 600 45,000
Axis Bank Limited 318 71,550
Notional value of futures contracts bought/sold by the Scheme and outstanding as at March 31, 2008 aggregates to Rs. 503,207,133.Net loss on futures and options transactions recognised in the Revenue Account for the period ended March 31, 2008 aggregates toRs. 24,647,243.
14 Discl osure Under Regulation 25(8) of the Securi ties and Exchang e Board of Ind ia (Mutu al Fund s ) Regulation , 1996 as amended(SEBI Regulation) and in accordance wi th Account ing Standard 18 on ‘Related Party Discl osures’ iss ued by the Institut e ofChartered Account ants of India (ICAI)
The Scheme has entered into transactions with certain related parties. The information required in this regard in accordance withAccounting Standard 18 on ‘Related Party Disclosures’ issued by the Institute of Chartered Accountants of India and Regulation 25(8)of SEBI Regulations, is provided below.
(i) Related Party rela tionships during the period
Name Descri pt ion of Relationship
JPMorgan Asset Management (Asia) Inc.* Sponsor of the Fund
JPMorgan Asset Management India Private Limited Investment Manager to the Schemes of JPMorgan Mutual Fund
JPMorgan India Private Limited Associate of the Investment Manager
Geojit Financial Services Limited
Mahindra And Mahindra Financial Services Limited
Mentor Technologies Private Limited
JPMorgan Mutual Fund India Private Limited Trustee to the Schemes of JPMorgan Mutual Fund
Bank of Baroda Associate of the Trustee to the Schemes of JPMorgan Mutual Fund
* - There were no transaction during the period
(ii ) Schemes of the Fund , und er common cont rol of the Spon sor during the period
JPMorgan India Liquid Fund
JPMorgan India Liquid Plus Fund
JPMorgan India Smaller Companies Fund
(iii ) Key Management Personn el and their Relatives during the period
Krishnamurthy Vijayan - Whole-time director and CEO, JPMorgan Asset Management India Private Limited
Usha Vijayan* (Relative of Key Management Personnel)
Keshav Vijayan* (Relative of Key Management Personnel)
* - There were no transaction during the period
13
(iv ) Transac tions during the Period
Rupees
Natu re of Transaction Trustee Associate Invest ment Associate of Schemes Key Totalof Trustee Manager Investment under Management
Manager Common PersonnelControl of and their
Sponsor of Relativesthe Fund
Purchase of Investments - - - 6,406,344,651 - 6,406,344,651
Sale of Investments - - - - 3,122,942,249 - 3,122,942,249
Subscription of Units(including switch in and dividendreinvestment) - 50,000,000 - 533,611 1,000,000,000.00 100,000 1,050,633,611
Redemption of Units(including switch out) - 70,179,112 - - 70,000,000.00 - 140,179,112
Dividend(Including dividend reinvested) - 5,000,000 - 33,611 - - 5,033,611
Investment Management andAdvisory Fees - - 92,622,706 - - - 92,622,706
Trusteeship Fees and Expenses 4,520,617 - - - - - 4,520,617
Brokerage/ Commission onPurchase/Sales of Investments - - - 3,818,405 - - 3,818,405
Brokerage/ Commission onDistribution of Units - - - 388,764 - - 388,764
(v) Outstanding As At Period End
Rupees
Nature of Transaction Trustee Associate Investment Asso ciate of Schemes Key Totalof Trustee Manager Investment under Management
Manager Common PersonnelControl of and their
Sponsor of Relativesthe Fund
Investment ManagementFees Payable - - 8,236,702 - - - 8,236,702
Trusteeship Fees andExpenses Payable 407,112 - - - - - 407,112
Units OutstandingAs At Period End - - - 366,841 664,133,391.00 90,497 664,590,729
Other Payables - - 14,733,917 - - - 14,733,917
Other Receivables - - - - 243,473 - 243,473
(vi ) Discl osures i n res pect of material transac tions wi th parties re ferred to in Note 14 (i) fo r Associa te of Inves tment Manager
April 19, 2007 toMarch 31, 2008
Rupees
Subscri pt ion of Units (includ ing swi tch in and divi dend reinves tment)
Mentor Technologies Private Limited 533,611
Divi dend ( Including divi dend reinves ted)
Mentor Technologies Private Limited 33,611
Brokerage/ Commissi on on Purchase/Sale of Investments
J P Morgan India Private Limited 3,818,405
Brokerage/ Commissi on on Dis tribut ion of Units
Geojit Financial Services Ltd. 346,950
Mahindra And Mahindra Financial Services Ltd. 41,814
Units Outstanding As At Period End
Mentor Technologies Private Limited 366,841
(vii ) Discl osures i n respect of material transac tion s wi th parties re ferred to in Note 14 (i) fo r Associa te of Trustee
April 19, 2007 toMarch 31, 2008
Rupees
Subscri pt ion of Units (includ ing swi tch in and divi dend reinves tment)
Bank of Baroda 50,000,000
Redemption of Units (includ ing swi tch in and divi dend reinves tment)
Bank of Baroda 70,179,112
Divi dend (Includ ing divi dend reinves ted)
Bank of Baroda 5,000,000
14
(viii ) Details of material transac tions wi th persons referred to in Note 14 (ii ) fo r Schemes und er common cont rol of the Spon sorof the Fund
April 19, 2007 toMarch 31, 2008
Rupees
Purchase of Inves tments
JPMorgan India Liquid Fund 1,806,439,320
JPMorgan India Liquid Plus Fund 4,089,176,740
JPMorgan India Smaller Companies Fund 510,728,591
Sale of Inves tments
JPMorgan India Liquid Fund 1,692,477,977
JPMorgan India Liquid Plus Fund 969,054,680
JPMorgan India Smaller Companies Fund 461,409,592
Subscri pt ion of Units (includ ing swi tch in and divi dend reinves tment)
JPMorgan India Smaller Companies Fund 1,000,000,000
Redemption of Units (includ ing swi tch out)
JPMorgan India Smaller Companies Fund 70,000,000
Units Outstanding As At Period End
JPMorgan India Smaller Companies Fund 663,889,918
Other Receiva bles
JPMorgan India Liquid Plus Fund 46,073
JPMorgan India Smaller Companies Fund 190,800
(ix) Discl osures i n respect of material transactions wi th persons re ferred to in Note 14 (iii ) for key ma nagement personn el andtheir rela tives
April 19, 2007 toMarch 31, 2008
Rupees
Subscri pt ion of Units (includ ing swi tch in and divi dend reinves tment)
Krishnamurthy Vijayan 100,000
Units Outstanding As At Year End March 31, 2008
Krishnamurthy Vijayan 90,497
15 Segment Reporting
The Scheme operates in one segment only viz. to primarily generate attractive returns from a diversified and actively managed portfolioof equity and equity related inistruments.
16 Unclaime d Redemptions
As at March 31, 2008, unclaimed redemptions aggregate Rs.1,830,285 payable to investors.
17 Prior Year Comparatives
As these are the first financial statements of the Scheme since the date of its commencement, there are no comparative figures.
K. H. VACHHA Fo r and on behalf of Fo r and on behalf ofPartner JPMorgan Asset JPMorgan Mutu al Fund
Management Ind ia Priva te Limi ted Ind ia Priva te Limi ted
For and on behalf of
PRICE WATERHOUSE Mr. Kris hnamurth y Vijaya n Mr. Jagadish SalunkheChartered Accountants Whole-time director and CEO Chairman
Mr. K. G. Vassal Dr. Dharmendra BhandariDirector Director
Place : Mumbai Mr. Harshad M PatwardhanDate : September 26, 2008 Head - Equity and Fund Manager
15
Auditors’ ReportTo the Trustee
JP MORGAN MUTUAL FUND
1. We have audited the Balance Sheet of JPMorgan Mutual Fund – JPMorgan India Smaller Companies Fund (“The Scheme”) as at March31, 2008 and the related Revenue Account for the period November 9, 2007 to March 31, 2008, both of which we have signed underreference to this report. These financial statements are the responsibility of Trustee of JPMorgan Mutual Fund and the Management ofJPMorgan Asset Management India Private Limited (the “Management”). Our responsibility is to express an opinion on these financialstatements based on our audit.
2. We have conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we planand perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. Anaudit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Ourprocedures included confirmation of securities owned at March 31, 2008 by correspondence with the custodian and others. An auditalso includes assessing the accounting principles used and significant estimates made by the management, as well as evaluating theoverall financial statements presentation. We believe that our audit provides a reasonable basis for our opinion.
3. We have obtained all the information and explanations which, to the best of our knowledge and belief, were necessary for the purposesof our audit. The Balance Sheet and the Revenue Account referred to above are in agreement with the books of account of the Scheme.
4. In our opinion and to the best of our information and according to the explanations given to us;
(i) The Balance Sheet and the Revenue Account together with the notes thereon give the information required by the Securities andExchange Board of India (Mutual Funds) Regulations, 1996 and amendments thereto, as applicable, and also give respectivelya true and fair view of the state of affairs of JPMorgan Mutual Fund – JPMorgan India Smaller Companies Fund as at March 31,2008 and its net deficit for the period November 9, 2007 to March 31, 2008.
(ii) The Balance Sheet as at March 31, 2008, and the Revenue Account for the period November 9, 2007 to March 31, 2008, togetherwith the notes thereon, have been prepared in all material respects in accordance with the accounting policies and standardsspecified in the Ninth Schedule of the Securities and Exchange Board of India (Mutual Funds) Regulations, 1996 and amendmentsthereto, as applicable.
(iii) The methods used to value non traded securities as at March 31, 2008 as determined by JPMorgan Asset Management IndiaPrivate Limited under procedures approved by the Trustee of JPMorgan Mutual Fund in accordance with the guidelines forvaluation of securities of mutual funds dated September 18, 2000 and amendments thereto as applicable issued by the Securitiesand Exchange Board of India are fair and reasonable.
K. H. VachhaPartnerMembership No. F/30798
For and on behalf of
PRICE WATERHOUSEChartered Accountants
MumbaiSeptember 29, 2008
16
Balance Sheet as at March 31, 2008March 31, 2008
Schedule Rupees
ASSETS
Investments 1 3,782,731,562
Deposits 2 59,500,000
Other Current Assets 3 20,066,160
TOTAL 3,862,297,722
LIABILITIES
Unit Capital 4 5,261,161,438
Reserves and Surplus 5 (1,439,949,681)
Current Liabilities and Provisions 6 41,085,965
TOTAL 3,862,297,722
RECONCILIATION OF NET ASSET VALUE PER UNIT
March 31, 2008 March 31, 2008 March 31, 2008Growth Opt ion Divi dend Option Tot al
Rupees Rupees Rupees
Net Assets as per Balance Sheet(Total Assets less Current Liabilities and Provisions ) (Note 2.7) 1,961,600,443 1,859,611,314 3,821,211,757
Number of Units in Issue 270,077,996.521 256,038,147.278
Net Asset Value per Unit 7.263 7.263
Notes to the Financial Statements 8
The Schedules referred to herein form an integral part of the Financial Statements.
This is the Balance Sheet referred to in our report of even date.
K. H. VACHHA Fo r and on behalf of Fo r and on behalf of
Partner JPMorgan Asset JPMorgan Mutual Fund
For and on behalf of Management Ind ia Priva te Limi ted Ind ia Priva te Limi ted
PRICE WATERHOUSE
Chartered Accountants
Mr. Kris hnamurthy Vijaya n Mr. Jagadish Salunkhe
Whole-time director and CEO Chairman
Mr. K. G. Vassal Dr. Dharmendra Bhandari
Director Director
Place: Mumbai Mr. Harshad M Patwardhan
Date: September 29, 2008 Head - Equity and Fund Manager
17
Revenue Accoun t fo r the period November 9, 2007 toMarch 31, 2008
November 9, 2007 to
March 31, 2008
Schedule Rupees
INCOME AND GAINS
Dividends (Note 2.4) 932,195
Interest and Discount 7 26,819,609
Miscellaneous Income (Note 10) 93,108
TOTAL 27,844,912
EXPENSES AND LOSSES
Net Loss on Sale of Investments and Derivatives
(including Net Loss on Inter Scheme Sale of Investments Rs. 7,196) (Note 2.3) 305,856,286
Investment Management and Advisory Fees (Note 4) 13,841,804
Transfer Agent Fees and Expenses 2,263,560
Trusteeship Fees and Expenses (Note 5) 649,169
Custodian Fees and Expenses (Note 6) 474,012
Audit Fees 225,000
Selling and Distribution Expenses 11,197,533
Other Operating Expenses 1,225,208
TOTAL (Note 11(b)) 335,732,572
Net Defici t fo r the Peri od (307,887,660)
Net Unrealised Depreciation in Value of Investments (1,138,201,709)
Net Defici t incl ud ing Net Unrealise d Deprecia tion in Value of Inves tments (1,446,089,369)
November 9, 2007 to No vember 9, 2007 to No vember 9, 2007 to
March 31, 2008 March 31, 2008 March 31, 2008
Growth Opt ion Divi dend Opt ion Tot al
Rupees Rupees Rupees
Net Deficit for the Period including Net Unrealised Depreciation in Value of Investments by Option (738,219,862) (707,869,507) (1,446,089,369)
Transfer from Income Equalisation Reserve (Note 2.9) (2,973,202) 5,893,796 2,920,594
Balance transferred to Reserve Fund (741,193,064) (701,975,711) (1,443,168,775)
Notes to the Financial Statements 8
The Schedules referred to herein form an integral part of the Financial Statements.
This is the Revenue Account referred to in our report of even date.
K. H. VACHHA Fo r and on behalf of Fo r and on behalf of
Partner JPMorgan Asset JPMorgan Mutual Fund
For and on behalf of Management Ind ia Priva te Limi ted Ind ia Priva te Limi ted
PRICE WATERHOUSE
Chartered Accountants
Mr. Kris hnamurthy Vijaya n Mr. Jagadish Salunkhe
Whole-time director and CEO Chairman
Mr. K. G. Vassal Dr. Dharmendra Bhandari
Director Director
Place: Mumbai Mr. Harshad M Patwardhan
Date: September 29, 2008 Head - Equity and Fund Manager
18
Schedules forming part of the Balance Sheet as at March 31, 2008 and theRevenue Account for the period November 9, 2007 to March 31, 2008
SCHEDULE 1 March 31, 2008 March 31, 2008
Investments Marke t/Fair Val ue Cost
(Notes 2.2, 2.3, 7, 8, 9 and 12) Rupees Rupees
(Refer to the attached Statement of Portfolio Holding as at March 31, 2008)
Equity Shares 2,960,191,569 3,863,005,831
Certificate of Deposit 158,650,075 158,650,075
Units in Mutual Fund 663,889,918 899,277,365
TOTAL 3,782,731,562 4,920,933,271
SCHEDULE 2 March 31, 2008
Deposits Rupees
Deposits with Scheduled Bank (Under Lien Towards Margin Deposit for Equity Derivatives) 50,000,000
Margin Deposit with Clearing Corporation of India towards Collateralized Borrowing and Lending Obligation 9,500,000
TOTAL 59,500,000
SCHEDULE 3 March 31, 2008
Other Current Asse ts Rupees
Balances with Banks - in Current Account 7,464,896
Unit Subscriptions Receivable 5,745,991
Inter-Scheme Receivable - Switch - In 1,531,382
Derivative Margin Deposit (Note 2.5) 4,818,454
Interest Receivable - Deposits 88,699
Receivable on Outstanding Futures Contracts 416,738
TOTAL 20,066,160
SCHEDULE 4 March 31, 2008 March 31, 2008
Unit Capital Rupees Units
Growth Opt ion
Issued and Subscri bed :
Units of Rs.10 each fully paid up 2,523,349,058 252,334,905.761
Outstanding:
Initial Issue and Subscription 2,523,349,058 252,334,905.761
Issued during the period 288,666,052 28,866,605.158
2,812,015,110 281,201,510.919
Redeemed during the period 111,235,144 11,123,514.398
At the end of the period 2,700,779,966 270,077,996.521
Dividend Opt ion
Issued and Subscri bed :
Units of Rs.10 each fully paid up 2,480,060,127 248,006,012.701
Outstanding:
Initial Issue and Subscription 2,480,060,127 248,006,012.701
Issued during the period 230,112,948 23,011,294.834
2,710,173,075 271,017,307.535
Redeemed during the period 149,791,603 14,979,160.257
At the end of the period 2,560,381,472 256,038,147.278
TOTAL 5,261,161,438 526,116,143.799
19
Schedules forming part of the Balance Sheet as at March 31, 2008 and theRevenue Account for the period November 9, 2007 to March 31, 2008
SCHEDULE 5 Growth Opt ion Divi dend Option Tot al
Reserves a nd Surplus March 31, 2008 March 31, 2008 March 31, 2008
Rupees Rupees Rupees
Unit Premium Reserve (Note 2.8)
Added during the period 1,657,131 872,700 2,529,831
At the end of the period 1,657,131 872,700 2,529,831
Income Equ alisa tion Reserve (Note 2.9)
Added during the period (2,973,202) 5,893,796 2,920,594
Transferred to Revenue Account 2,973,202 (5,893,796) (2,920,594)
At the end of the period - - -
Unrealise d App recia tion Reserve
Net Unrealised Appreciation in Value of Investments and Derivatives 356,410 332,853 689,263
At the end of the period 356,410 332,853 689,263
Reserve Fund
Balance Transferred from Revenue Account (741,193,064) (701,975,711) (1,443,168,775)
At the end of the period (741,193,064) (701,975,711) (1,443,168,775)
TOTAL (739,179,523) (700,770,158) (1,439,949,681)
SCHEDULE 6
Current Liabili ties and Provisi ons March 31, 2008
Rupees
Current Liabili ties
Investment Management and Advisory Fees 2,582,914
Transfer Agent Fees and Expenses 1,172,944
Trusteeship Fees and Expenses 121,144
Custodian Fees and Expenses 93,371
Audit Fees 225,000
Selling and Distribution Expenses 2,824,453
Purchase Contracts Awaiting Completion -Equity Shares 12,673,260
Unit Redemptions Payable 5,137,360
Inter Scheme Payable
- For Switch - Out 7,574,467
- For Others 190,800
Load (Note 2.10) 3,291,230
Payable to Investment Manager 3,396,045
Sundry Payables 1,802,977
TOTAL 41,085,965
SCHEDULE 7 November 9, 2007 to
Interes t and Disc ount (Note 2.4) March 31, 2008
Rupees
Debentures / Bonds 15,445,506
Commercial Paper / Certificate of Deposit 2,122,681
Reverse Repos 4,097,060
Collateralized Borrowing and Lending Obligation 5,050,114
Margin Deposit with the Clearing Corporation of India Limited 15,549
Deposits 88,699
TOTAL 26,819,609
20
Statement of Portfo lio Holding as at March 31,2008
(Referred to in Schedule 1 to the Balance Sheet as at March 31,2008 and theRevenue Account for the period November 9, 2007 to March 31, 2008)
Description Quant ity Marke t /Fair Value
Rupees
EQUITY SHARES (78.26%)
AUTO ANCILLAR IES (3.63%)
Balkrishna Industries Limited 148,000 80,142,000
Asahi India Glass Limited 410,000 27,429,000
BANK S (3.32%)
Indian Overseas Bank 469,742 63,462,144
Yes Bank Ltd. 205,811 34,730,606
CONSTRUCTION (3.84%)
SIMPLEX INFRASTRUCTURE LTD. 95,500 58,632,225
Consolidated Const. Consortium Ltd. 56,000 41,031,200
Kalindee Rail Nirman Engineers Ltd 49,582 14,135,828
CONSUMER DURABL ES (3.33%)
Voltas Ltd. 549,347 98,690,189
CONSUMER NON DURABL ES (8.78%)
Advanta India Limited 167,277 177,924,181
Kaveri Seed Company Limited 148,698 41,620,570
Lakshmi Energy And Foods Ltd 176,000 40,480,000
FERROUS METALS (4.17%)
Welspun Guj Stahl Rohren Ltd 222,591 85,285,742
Usha Martin Ltd. 480,000 38,160,000
FINANCE (8.01%)
Shriram Transport Finance Co Ltd. 491,400 165,896,640
SREI Infrastructure Finance Ltd. 526,950 71,243,640
GAS (0.94%)
Gujarat Fluorochemicals Ltd 154,000 27,881,700
INDUSTRIAL CAPITAL GOODS (12.17%)
Bharati Shipyard Ltd. 297,202 161,677,888
Thermax India Ltd. 155,444 94,354,508
Elecon Engineering Ltd. 335,000 65,877,750
BGR Energy Systems Limited 112,108 38,329,725
INDUSTRIAL PRODUCTS (16.61%)
Sintex Industries Ltd. 405,300 143,982,825
Jain Irrigation Systems Ltd. 162,000 95,904,000
Max India Limited 571,000 84,650,750
Everest Kanto Cylinder Limited 282,500 76,020,750
Time Technoplast Limited 68,607 54,319,592
Asian Electronics Ltd. 100,000 19,905,000
Ess Dee Aluminium Limited 31,445 16,780,624
MINERALS/MINING (5.08%)
Gujarat NRE Coke Ltd 753,000 103,951,650
Sesa Goa Ltd. 14,699 46,324,633
OIL (3.11%)
Shiv-Vani Oil & Gas Exploration Services Limited 175,697 92,056,443
PHARMACEUTICALS (6.19%)
Jubilant Organosys Limited 425,030 139,346,086
Glenmark Pharmaceuticals Ltd. 90,000 44,010,000
21
Statement of Portfo lio Holding as at March 31,2008
(Referred to in Schedule 1 to the Balance Sheet as at March 31,2008 and theRevenue Account for the period November 9, 2007 to March 31, 2008)
Description Quant ity Marke t /Fair Value
Rupees
POWER (8.97%)
Techno Elec & Engineering Co Ltd 400,000 91,340,000
Jyoti Structures Ltd. 557,000 89,036,450
GVK Power & Infrastructure Ltd 1,250,000 50,062,500
Lanco Infratech Limited 90,000 34,969,500
SOFTWARE (8.59%)
Everonn Systems India Limited 178,609 104,370,169
Educomp Solutions Ltd. 21,087 80,635,634
KLG Systel Limited 63,003 35,508,491
Financial Technologies India 21,034 33,636,521
TELECOM - EQUIPMENT & ACCESSORIES (1.47%)
Onmobile Global Limited 79,890 43,468,149
TEXTILE PRODUCTS (1.79%)
Bombay Rayon Fashions Ltd. 181,971 52,926,265
Total (Cost Rs. 3,863,005,831) 2,960,191,569
CERTIFICATE OF DEPOSIT (4.19%)
BANK S (100 %)
State Bank Of Mysore (28/05/2008)# 1,606,000 158,650,075
Total (Cost Rs. 158,650,075) 158,650,075
UNITS IN MUTUAL FUND (17.55%)
JPMorgan India Equity Fund - Growth 60,823,630 663,889,918
Total (Cost Rs. 899,277,365) 663,889,918
Total Investments (Cost Rs. 4,920,933,271) 3,782,731,562
EQUITY DERIVATIVES
LONG FUTURES (50.68%)
Axis Bank Limited APRIL 2008 FUTURE 11,025 8,682,188
BHARAT HEAVY ELECTRICALS LIMITED APRIL 2008 FUTURE 3,975 8,183,332
16,865,520
SHORT FUTURES (49.32%)
NTPC Limited APRIL 2008 FUTURE 39,000 7,694,700
HDFC BANK APRIL 2008 FUTURE 6,600 8,716,950
16,411,650
Total 33,277,170
FIXED DEPOSITS
BANK S (100%)
9.25% Centurion Bank Of Punjab Ltd. (24/06/2008) Duration Rup ees % to Net Asse ts
91 days 50,000,000 1.31%
Confirmation has been received from Deutsche Bank AG, Mumbai Branch at the end of financial period for investments held by them.
# Fair value of non-traded and thinly traded debt securities as determined by JPMorgan Asset Management India Private Limited underprocedures approved by the Trustee in accordance with the guidelines for valuation of securities for mutual funds dated September 18, 2000and amendments thereto as applicable issued by Securities and Exchange Board of India.
22
Annexure IDiscl osure und er Regu lation 25 (11) of the Securi ties and Exchange Board of Ind ia (Mutu al Fund s) Regu lations 1996 as amended
JPMorgan Mutu al Fund has made fo llowing investments in companies or their s ubsidiaries w hich ho ld units in excess of 5% of the netasse t value of any sc heme of JPMorgan Mutu al Fund fo r the period ended March 31,2008
Rupees
Name o f the Company Schemes Invested in by the Investments made by the S chemes Agg regated for the Outstanding as onCompany of JP Morgan Mutual Fund in the Period under March 31, 2008
Company or its Subsidiary Regulation 25(11) at Mar ket / Fair Valueat Cost
DSP Merrill Lynch Capital Limited JPMorgan India Liquid Fund JPMorgan India Equity Fund 817,500,000 -
JPMorgan India Liquid Fund 1,619,110,100 -
JPMorgan India Liquid Plus Fund 2,756,549,938 -
JPMorgan India Smaller Companies Fund 192,000,000 -
Finolex Cables Limited JPMorgan India Liquid Plus Fund JPMorgan India Equity Fund 410,781,693 -
JPMorgan India Smaller Companies Fund 500,000,000 -
Global Trade Finance Limited JPMorgan India Liquid Plus Fund JPMorgan India Smaller Companies Fund 500,000,000 -
HDFC Bank Limited JPMorgan India Liquid Plus Fund JPMorgan India Equity Fund 333,203,752 246,174,750
JPMorgan India Liquid Fund JPMorgan India Smaller Companies Fund 147,381,657 -
Housing Development Finance JPMorgan India Liquid Fund JPMorgan India Equity Fund 960,590,509 662,953,135Corporation Limited JPMorgan India Smaller Companies Fund 233,165,914 -
Infrastructure Development Finance JPMorgan India Liquid Fund JPMorgan India Equity Fund 191,326,192 155,014,184Company Limited JPMorgan India Liquid Plus Fund
Larsen and Toubro Limited JPMorgan India Liquid Fund JPMorgan India Equity Fund 957,833,357 355,804,232
JPMorgan India Liquid Plus Fund JPMorgan India Smaller Companies Fund 281,970,666 -
LIC Housing Finance Limited JPMorgan India Liquid Plus Fund JPMorgan India Liquid Plus Fund 100,000,000 100,090,340
Tata Consultancy Services Limited JPMorgan India Liquid Plus Fund JPMorgan India Equity Fund 204,243,470
23
Schedules forming part of the Balance Sheet as at March 31, 2008 and theRevenue Account for the period November 9, 2007 to March 31,2008Schedu le 8
Notes to the Financial S tatements
1 Organisation
JPMorgan India Smaller Companies Fund (the”Scheme”) is an open-ended equity growth scheme of JPMorgan Mutual Fund (the “Fund”)and was launched on November 9, 2007. JPMorgan Mutual Fund has been sponsored by JPMorgan Asset Management (Asia) Inc.JPMorgan Asset Management India Private Limited incorporated under the Companies Act, 1956 has been appointed as assetmanagement company. The duration of the Scheme is perpetual. The Scheme closed for initial subscription on Novemeber 30, 2007 andreopened for issue and redemption of units on December 26, 2007. The investment objective of the Scheme is to seek to generate longterm capital appreciation from a portfolio that is substantially constituted of equity and equity related securities focussed on smallercompanies. The Scheme has two options - Growth and Dividend Option.
The Scheme will not declare dividend under the Growth Option in normal circumstances. The income earned on such units will remaininvested within the Scheme and will be reflected in the net asset value.
2 Sign ificant Account ing Policies
2.1 Basis of Account ing
The Scheme maintains its books of account on an accrual basis. These financial statements have been prepared in accordancewith the accounting policies and standards spcecified in the Ninth Schedule of the Securities and Exchange Board ofIndia(SEBI)(Mutual Funds) Regulations, 1996 (“the Regulation”) and amendments thereto, as applicable.
2.2 Portfo lio Valuation
Investments are stated at market / fair value at the Balance Sheet date / date of determination. In valuing the Scheme’sinvestments:
(i) Equity securities listed on a recognised stock exchange are valued at the last quoted closing price on the National StockExchange of India Limited (NSE). If on a particular valuation date, a security is not traded on NSE, the value at which it istraded on Bombay Stock Exchange Limited (BSE) is used. If no sale is reported at that time, the last quoted closing priceon the principal stock exchange on which the securtity is traded is used when it is not more than thirty days prior to thevaluation date.
(ii) Non-traded and thinly traded equity securities including those not traded within thirty days prior to the valuation date arevalued at fair value as determined by JPMorgan Asset Management India Private Limited under procuedures approved bythe Trustee of JPMorgan Mutual Fund in accordance with the guidelines for valuation of securities for mutual funds datedSeptember 18, 2000 and amendments thereto, as applicable, issued by the Securities and Exchange Board of India (SEBI).
(iii) Debt securities listed on a recognised stock exchange are valued at the last quoted closing price on the NSE. If no saleis reported at that time, such security is valued at fair value as determined in good faith by JPMorgan Asset ManagementIndia Private Limited under procedures approved by the Trustee of JPMorgan Mutual Fund.
(iv) Non-traded and thinly traded debt securities are valued at fair value as determined by JPMorgan Asset Managament IndiaPrivate Limited under procedures approved by the trustee of JPMorgan Mutual Fund in accordance with the guidelines forvaluation of securities for mutual fund dated September 18, 2000 and amendments thereto, as applicable, issued by theSecurities and Exchange Board of India (SEBI).
(v) Privately placed debt securities are valued at fair value as determined in good faith by JPMorgan Asset Management IndiaPrivate Limited under procedures approved by the Trustee of JPMorgan Mutual Fund
(vi) Instruments bought on ‘repo’ basis are valued at the resale price after deduction of applicable interest up to the date ofresale.
(vii) Traded money market securities are valued at the yield at which they are traded on the valuation date. If no sale is reportedat that time, such security is valued at the last traded price plus accretion of the difference between the face value andthe last traded price. Non traded money market instruments are valued at cost plus accrued interest.
(viii) Units in mutual fund are valued at the net asset value of the investee schemes.
Following the issue of guidance note on accounting for investments in the financial statements of the mutual funds by theInstitute of Chartered Accountants of India (pursuant to the Eleventh Schedule of the Regulations) net unrealised appreciation/ depreciation in the value of investments is determined separately for each category of investment.Further in respect of eachcategory of investments, the net change in the unrealised appreciation if any, between two balance sheet dates / valuation datesis accounted through the Unrealised Appreciation Reserve and net depreciation if any, is accounted through the RevenueAccount.
Unrealised appreciation is reduced from the distributable income at the time of income distribution.
2.3 Securi ties Transac tions
Investment securities transactions are accounted for on a trade date basis. The Scheme uses the average cost method fordetermining the realised gain or loss on sale of investments.
2.4 Inves tment Income
Interest and dividend income are recorded on an accrual basis.
2.5 Deriva tives
The Scheme enters into derivatives transactions in equity/index futures for the purpose of hedging and portfolio balancing.‘Derivatives margin deposit’ representing margin towards equity derivative contracts entered into by the Schemes is disclosedunder ‘Other Current Assets’.
Futu res
Futures contracts are marked to market daily at the futures settlement price as determined by the exchange. The variation margincalculated as the difference between the trade price or the pervious day’s settlement price, as the case may be, and the currentday’s settlement price is recorded as a receivable or payable.
24
When a contract is closed (squared-off) / settled (on expiry), the difference between the final settlement / square-off price andthe contract price is recognised in the Revenue Account. If more than one futures contracts in respect of the same stock / indexand expiry date, to which the squared-off / settled contract pertains, is outstanding at the time of square-off / settlement of thecontract, the average method is followed for determining the gain/loss.
As at the Balance Sheet date / date of determination, all open futures positions are valued at the futures settlement price asdetermined by the exchange where it is traded. Non-traded futures contract are valued at fair value as per procedures /determined by JPMorgan Asset Management India Private Limited and approved by the Trustee. The unrealised appreciation /depreciation on all open positions is considered for determining the net assets.
2.6 Initial Issue Expenses
Initial issue expenses upto 2.25% of the amount mobilised during the new fund offering period was borne from the entry loadcollected from the investors during the new fund offer period. Expenses over and above the applicable entry load were borne bythe asset management company.
2.7 Net Asset Value for Growth / Dividend Option
The net asset value of the units of the Scheme is determined separately for the units issued under Growth and Dividend Option.
For reporting the net asset value for the Options, daily income earned, including realised and unrealised gain or loss in the valueof investments and expenses incurred by the Scheme are allocated to the Options in proportion to the value of the unitsoutstanding.
2.8 Unit Premium Reserve
Upon issue and redemption of units, the net premium or discount to the face value of units is adjusted against the unit premiumreserve of the Scheme, after an appropriate portion of the issue proceeds and redemption payout is credited or debitedrespectively to the income equalization reserve.
The unit premium reserve is available for dividend distribution except to the extent it is represented by unrealised net appreciationin value of investments.
2.9 Income Equalization Reserve
The net distributable income relating to units issued / repurchased is transferred to / from income equialisation reserve fordetermining the net surplus / deficit, transferred from / to unit premium reserve.
2.10 Load
Load collected is retained under a separate account in the Scheme and is utilized to meet the selling and distribution expensesof the Scheme.
3 Income Taxes
No provision for taxation has been made as the Scheme qualifies as a recognised mutual fund under Section 10 (23D) of the IncomeTax Act, 1961 of India.
4 Investment Management Fees
The Scheme has paid or provided for investment management and advisory fees payable to the JPMorgan Asset Management IndiaPrivate Limited for managing the Scheme at an average annual rate 0.91% of the average daily net asset value recorded by theScheme. All costs, charges and expenses incurred by JPMorgan Asset Management India Private Limited in the administration andexecution of the activities of the Scheme, except costs allowed to be charged to the scheme under the Regulations are on theiraccount for which they receive investment management and advisory fees.
5 Trustee Fees
In accordance with the Trust Deed dated December 4,2006 between JPMorgan Asset Management (Asia) Inc. (the “Settlor”) andJPMorgan Mutual Fund India Private Limited (the Trustee), the Scheme has paid or provided for trustee fees payable to the Trustee atthe rate of 0.05% of the average daily net asset values recorded by the Schemes of the Fund or Rs. one crore per annum, whicheveris lower.
6 Custod ian Fees
Deutsche Bank AG, Mumbai Branch provides custodial services to the Scheme for which it receives custody fees.
7 Agg regate App recia tion And Deprecia tion In The Value Of Investments
Aggregate appreciation and depreciation in the value of investments is as follows:
March 31, 2008(Rupees)
Equity Shares
- Appreciation 14,884,513
- Depreciation 917,698,775
Units in Mutual Fund
- Appreciation -
- Depreciation 235,387,447
Equity Futures
- Appreciation 689,263
- Depreciation -
8 Agg regate Fair Val ue of Non-Traded Investments
Aggregate fair value of non-traded (including privately placed) investments as determined by JPMorgan Asset Management IndiaPrivate Limited under the procedures approved by the Trustee as at March 31,2008 is Rs. 158,650,075.
25
9 Aggregate Value Of Purchase And Sale Of Inves tments
The aggregate value of investments purchased and sold (including matured) during the financial period is Rs. 8,351,182,119 (excludingaccretion of discount of Rs. 7,172,795) and Rs. 3,137,463,309 being 551.78% (annualized) and 207.30% (annualized) respectively ofthe average daily net assets.
10 Miscella neous Income
Miscellaneous Income Rs. 93,108 represents amount received from JPMorgan Asset Management India Private Limted on account ofdelayed recording of unit capital transactions calculated as the difference between the net asset value on the date of recording andthe transaction date.
11 Income And Expenses
(a) The total income (including net loss on sale of investments and derivatives and net unrealised depreciation in the value ofinvestments and derivatives) and total expenses during the period is Rs. (1,416,213,083) and Rs. 29,876,286 respecively being(93.57)% (annualized) and 1.97% (annualized) of the average daily net assets.
(b) The expenses have been accrued from the date of closure of the new fund offering period.
12 Discl osure Under Regu lation 25(11) Of The Securi ties And Exchange Bo ard Of Ind ia (Mutu al Fund s) Regu lations, 1996, AsAmended
JPMorgan Mutual Fund has made investments in companies, which hold / have held units in excess of 5% of the net asset value ofany scheme of JPMorgan Mutual Fund which have been listed in Annexure I.
13 Equ ity Deriva tives Discl osures
Futu res
Details of open interest in equity futures of April 2008 Series as at March 31,2008 :
Underlyi ng Asse t Name Number of Cont racts Units Outstanding
Short Long
Bharat Heavy Electricals Limited 53 3,975
HDFC Bank 33 (6,600)
NTPC Limited 24 (39,000)
Axis Bank Limited 49 11,025
Notional Value of futures contracts bought/sold by the Scheme and outstanding as at March 31, 2008 aggregates to Rs. 33,277,170.Net loss on futures transactions recognised in the Revenue Account for the period ended March 31, 2008 aggregates to Rs. 5,897,952
14 Discl osure Under Regulation 25(8) of the Securi ties and Exchang e Board of Ind ia (Mutu al Fund s ) Regu lation , 1996 as amended(SEBI Regu lations) and in accordance wi th Account ing Standard 18 on ‘Related Party Discl osures’ iss ued by the Institut e ofChartered Account ants of Ind ia (ICAI)
The Scheme has entered into transactions with certain related parties. The information required in this regard in accordance withAccounting Standard 18 on ‘Related Party Disclosures’ issued by the Institute of Chartered Accountants of India and Regulation 25(8)of SEBI Regulations, is provided below :
(i) Related party rela tionships during the period
Name Descri pt ion of Relationship
JPMorgan Asset Management (Asia) Inc. * Sponsor of the Fund
JPMorgan Mutual Fund Private Limited Trustee to the Schemes of JPMorgan Mutual Fund
JPMorgan Asset Management India Private Limited Investment Manager to the Schemes of JPMorgan Mutual Fund
JPMorgan India Private Limited Associates of the Investment Manager
Geojit Financial Services Limited
Mahindra And Mahindra Financial Services Limited
Muthoot Fincorp Limited
Mentor Technologies Private Limited
JBF Industries Limited Associates of the Trustee of the Schemes of JPMorgan Mutual Fund
Global Trade Finance Limited
* - There were no transactions during the period
(ii ) Schemes of the Fund , und er common cont rol of the Spon sor during the period
JPMorgan India Equity Fund
JPMorgan India Liquid Plus Fund
JPMorgan India Liquid Fund
(iii ) Key Management Personn el and their Relatives du ring the period
Krishnamurthy Vijayan - Whole-time director and CEO, JPMorgan Asset Management India Private Limited
Usha Vijayan* (Relative of Key Management Personnel)
Keshav Vijayan* (Relative of Key Management Personnel)
* - There were no transactions during the period
26
(iv) Transac tions during the period
Rupees
Nature of Transaction Trustee Associate of Invest ment Associate of Schemes under Key Management TotalTrustee Manager Investment Common Control Personnel a nd
Manager of Sponsor of their Relativesthe Fund
Purchase of Investments - 500,000,000 - 250,014,822 4,095,693,100 - 4,845,707,922
Sale of Investments 501,138,711 - 250,528,644 2,408,747,543 - 3,160,414,898
Subscription of Units(including switch in anddividend reinvestment) - 20,000,000 - 1,000,000 100,000 21,100,000
Brokerage/ Commission onPurchase/Sale of Investments - - 1,982,565 - - 1,982,565
Brokerage/ Commission onDistribution of Units - - 222,063 - - 222,063
Investment Managementand Advisory Fees - 13,841,804 - - - 13,841,804
Trusteeship Fees and Expenses 649,169 - - - - - 649,169
Investment in units of otherSchemes of the Fund (includingdividend reinvestment) 1,000,000,000 - - - - - 1,000,000,000
Redemption of units ofother Schemes of the Fund - - - - 70,000,000 - 70,000,000
(v) Outstand ing as at Period
Rupees
Nature of Transaction Trustee Associate of Investment A ssociate of Schemes under Key Management TotalTrustee Manager Investment Common Control Personnel a nd
Manager of Sponsor of their Relativesthe Fund
Investment ManagementFees Payable - 2,582,914 - - - 2,582,914
Trusteeship Fees Payable 121,144 - - - 121,144
Brokerage on Purchase/Saleof Investments Payable - - 221 - - 221
Units Outstanding As At Period 14,206,357 - 710,318 663,889,918 71,032 678,877,625
Other Payables - 3,396,045 - 190,800 - 3,586,845
(vi ) Discl osures i n respect of material transac tions wi th parties re ferred to in Note 14 (i) fo r Associa te of Inves tment Manager
November 09, 2007 toMarch 31, 2008
Rupees
Purchase of Inves tments
Mahindra and Mahindra Financial Services Limited 250,014,822
Sale of Inves tments
Mahindra and Mahindra Financial Services Limited 250,528,644
Subscri pt ion of Units (includ ing swi tch in and divi dend reinves tment)
Muthoot Fincorp Limited 500,000
Mentor Technologies Private Limited 500,000
Units Outstanding As At Period End
Muthoot Fincorp Limited 355,159
Mentor Technologies Private Limited 355,159
Brokerage on purchase/sale of Inves tments
J P Morgan India Private Limited 1,982,565
Brokerage/ Commissi on on Dis tribut ion of Units
Geojit Financial Services Limited 207,902
Mahindra and Mahindra Financial Services Limited 14,161
Brokerage on purchase/sale of inves tments payable
JPMorgan India Private Limited 221
27
(vii ) Discl osures i n respect of material transac tions wi th parties re ferred to in Note 14 (i) fo r Associa te of Trustee
November 09, 2007to March 31, 2008
Rupees
Purchase of Inves tments
Global Trade Finance Limited 500,000,000
Sale of Inves tments
Global Trade Finance Limited 501,138,711
Subscri pt ion of Units (includ ing swi tch in and divi dend reinves tment)
JBF Industries Limited 20,000,000
Units Outstanding As At Period End
JBF Industries Limited 14,206,357
(viii ) Details of material transac tions wi th respect to parties re ferred to in Note 14 (ii ) fo r Schemes und er common cont rol of theSponsor.
November 09, 2007to March 31, 2008
Rupees
Purchase of Inves tments
JPMorgan India Equity Fund 461,409,592
JPMorgan India Liquid Fund 1,121,880,235
JPMorgan India Liquid Plus Fund 2,512,403,273
Sale of Inves tments
JPMorgan India Equity Fund 510,728,591
JPMorgan India Liquid Fund 1,008,809,807
JPMorgan India Liquid Plus Fund 889,209,145
Inves tments in Units of oth er Schemes of the Fund
JPMorgan India Equity Fund 1,000,000,000
Redemption of Units (includ ing swi tch out)
JPMorgan India Equity Fund 70,000,000
Units Outstand ing as at Period End
JPMorgan India Equity Fund 663,889,918
Other Payable
JPMorgan India Equity Fund 190,800
(ix) Discl osures i n respect of material transactions wi th persons re ferred to in Note 14 (iii ) for key ma nagement personn el andtheir rela tives
November 09, 2007to March 31, 2008
Rupees
Subscri pt ion of Units (includ ing swi tch in and divi dend reinves tment)
Krishnamurthy Vijayan 100,000
Units Outstanding As At Period End
Krishnamurthy Vijayan 71,032
15 PRIOR YEAR COMPARATIVES
As these are the first financial statements of the Scheme, since the date of its commencement there are no comparative figures.
K. H. VACHHA Fo r and on behalf of Fo r and on behalf ofPartner JPMorgan Asset JPMorgan Mutual Fund
Management Ind ia Priva te Limi ted Ind ia Priva te Limi ted
For and on behalf of
PRICE WATERHOUSEChartered Accountants
Mr. Kris hnamurthy Vijaya n Mr. Jagadish SalunkheWhole-time director and CEO Chairman
Mr. K. G. Vassal Dr. Dharmendra BhandariDirector Director
Place: Mumbai Mr. Harshad M PatwardhanDate: September 29, 2008 Head - Equity and Fund Manager
28
Auditors’ Report
To the Trustee
JPMORGAN MUTUAL FUND
1. We have audited the Balance Sheet of JPMorgan Mutual Fund – JPMorgan India Liquid Fund (The “Scheme”) as at March 31, 2008 andthe related Revenue Account for the period September 18, 2007 to March 31, 2008, both of which we have signed under reference tothis report. These financial statements are the responsibility of the Trustee of JPMorgan Mutual Fund and the Management ofJPMorgan Asset Management India Private Limited (the “Management”). Our responsibility is to express an opinion on these financialstatements based on our audit.
2. We have conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we planand perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. Anaudit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Ourprocedures included confirmation of securities owned at March 31, 2008 by correspondence with the custodian and others. An auditalso includes assessing the accounting principles used and significant estimates made by the Management as well as evaluating theoverall financial statements presentation. We believe that our audit provides a reasonable basis for our opinion.
3. We have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposesof our audit. The Balance Sheet and the Revenue Account referred to above are in agreement with the books of account of the Scheme.
4. In our opinion and to the best of our information and according to the explanations given to us;
(i) The Balance Sheet and the Revenue Account together with the notes thereon give the information required by the Securities andExchange Board of India (Mutual Funds) Regulations, 1996 and amendments thereto, as applicable, and also give respectivelya true and fair view of the state of affairs of JPMorgan Mutual Fund – JPMorgan India Liquid Fund as at March 31, 2008, and itsnet surplus for the period September 18, 2007 to March 31, 2008.
(ii) The Balance Sheet as at March 31, 2008, and the Revenue Account for the period September 18, 2007 to March 31, 2008together with the notes thereon, have been prepared in all material respects in accordance with the accounting policies andstandards specified in the Ninth Schedule of the Securities and Exchange Board of India (Mutual Funds) Regulations, 1996 andamendments thereto, as applicable.
(iii) The method used to value non traded debt securities as at March 31, 2008 as determined by JPMorgan Asset Management IndiaPrivate Limited under procedures approved by the Trustee of JPMorgan Mutual Fund in accordance with the guidelines forvaluation of securities of mutual funds dated September 18, 2000 and amendments thereto as applicable issued by the Securitiesand Exchange Board of India are fair and reasonable.
K. H. VachhaPartner
Membership No. F/30798
For and on behalf of
PRICE WATERHOUSE
Chartered Accountants
Mumbai
September 29, 2008
29
Balance Sheet as at March 31, 2008March 31, 2008
Schedule Rupees
ASSETS
Investments 1 3,179,656,091
Deposits 2 1,000,000
Other Current Assets 3 49,356,212
TOTAL 3,230,012,303
LIABILITIES
Unit Capital 4 2,786,809,641
Reserves and Surplus 5 64,864,087
Current Liabilities and Provisions 6 378,338,575
TOTAL 3,230,012,303
March 31, 2008 March 31, 2008 March 31, 2008RECONCILIATION OF NET ASSET VALUE PER UNIT Growth Daily Divi dend Tot al
Option ReinvestmentOption
Rupees Rupees Rupees
Net Assets as per Balance Sheet
(Total Assets less Current Liabilities and Provisions) (Note 2.5) 1,592,736,633 1,258,937,095 2,851,673,728
Number of Units in Issue 152,884,696.678 125,796,267.447
Net Asse t Value per Unit 10.418 10.008
Notes to the Financial Statements 8
The Schedules referred to herein form an integral part of the Financial Statements.
This is the Balance Sheet referred to in our report of even date.
K. H. VACHHA Fo r and on behalf of For and on behalf of
Partner JPMorgan Asset Management Ind ia Priva te Limi ted JPMorgan Mutu al Fund IndiaFor and on behalf of Priva te Limi ted
PRICE WATERHOUSE Mr. Kris hnamurthy Vijaya n Mr. Jagadish SalunkheChartered Accountants Whole-time director and CEO Chairman
Mr. K. G. Vassal Dr. Dharmendra BhandariDirector Director
Mr. Nandkumar R SurtiCIO - Fixed Income and Fund Manager
Place: Mumbai
Date: September 29, 2008
30
Revenue Accoun t for the period September 18, 2007 to March 31, 2008
September 18, 2007 toMarch 31, 2008
Schedule Rupees
INCOME AND GAINS
Interest and Discount 7 114,298,660
Net Profit on Sale of Investments (including Net Profit onInter Scheme Sale of Investments Rs.146,505) (Note 2.3) 837,740
Miscellaneous Income (Note 11) (2,101,301)
TOTAL 113,035,099
EXPENSES AND LOSSES
Investment Management and Advisory Fees (Note 4) 1,250,869
Transfer Agent Fees and Expenses 494,676
Trusteeship Fees and Expenses (Note 5) 194,262
Custodian Fees and Expenses (Note 6) 190,903
Audit Fees 225,000
Selling and Distribution Expenses 739,192
Other Operating Expenses 362,829
3,457,731
Less: Expenses to be Reimbursed by the Investment Manager (Note 7) 315,299
TOTAL 3,142,432
Net Surplus fo r the Peri od 109,892,667
September 18, 2007 September 18, 2007 September 18, 2007to to to
March 31, 2008 March 31, 2008 March 31, 2008
Growth Opt ion Daily Divi dendReinvestment
Opt ion Tot al
Rupees Rupees Rupees
Net Surplus for the Period by Option 76,244,951 33,647,716 109,892,667
Transfer from Income Equalisation Reserve (Note 2.7) 64,653,125 (99,440) 64,553,685
Dividend Distributions - (25,358,995) (25,358,995)
Dividend Tax Thereon - (7,182,932) (7,182,932)
Balance Transferred to Reserve Fund 140,898,076 1,006,349 141,904,425
The Schedules referred to herein form an integral part of the Financial Statements.
This is the Revenue Account referred to in our report of even date.
K. H. VACHHA Fo r and on behalf of For and on behalf of
Partner JPMorgan Asset Management Ind ia Priva te Limi ted JPMorgan Mutu al Fund IndiaFor and on behalf of Priva te Limi ted
PRICE WATERHOUSE Mr. Kris hnamurthy Vijaya n Mr. Jagadish SalunkheChartered Accountants Whole-time director and CEO Chairman
Mr. K. G. Vassal Dr. Dharmendra BhandariDirector Director
Mr. Nandkumar R SurtiCIO - Fixed Income and Fund Manager
Place: Mumbai
Date: September 29, 2008
31
Schedules forming part of the Balance Sheetas at March 31, 2008 and the Revenue Account fo r the period September 18, 2007 to March 31,2008
SCHEDULE 1 March 31, 2008 March 31, 2008
Investments Fair Val ue Cost
(Notes 2.2, 2.3, 8, 9 and 12) Rupees Rupees
(Refer to the attached Statement of Portfolio Holding as at March 31, 2008)
Commercial Paper / Certificate of Deposit 3,179,656,091 3,179,656,091
TOTAL 3,179,656,091 3,179,656,091
SCHEDULE 2 March 31, 2008
Deposits Rupees
Margin Deposit with Clearing Corporation of India towards
Collateralized Borrowing and Lending Obligation 1,000,000
TOTAL 1,000,000
SCHEDULE 3 March 31, 2008
Oth er Current Asse ts Rupees
Balances with Banks - in Current Account 629,024
Sales Contracts Awaiting Completion - Certificate of Deposits 48,439,300
Inter-Scheme Receivable - Switch - In 134,621
Receivable from Investment Manager 153,267
TOTAL 49,356,212
SCHEDULE 4 March 31, 2008 March 31, 2008
Unit Capital Rupees Units
Growth Opt ion
Issued and Subscri bed :
Units of Rs.10 each fully paid up 3,150,000,000 315,000,000.000
Outstanding:
Initial Issue and Subscription 3,150,000,000 315,000,000.000
Issued during the period 38,237,598,682 3,823,759,868.206
41,387,598,682 4,138,759,868.206
Redeemed during the period 39,858,751,715 3,985,875,171.528
At the end of the period 1,528,846,967 152,884,696.678
Daily Divi dend Reinves tment Opt ion
Issued and Subscri bed :
Units of Rs.10 each fully paid up 1,424,250,000 142,425,000.000
Outstanding:
Initial Issue and Subscription 1,424,250,000 142,425,000.000
Issued during the period 36,888,352,980 3,688,835,298.065
38,312,602,980 3,831,260,298.065
Redeemed during the period 37,054,640,306 3,705,464,030.618
At the end of the period 1,257,962,674 125,796,267.447
TOTAL 2,786,809,641 278,680,964.125
32
Schedules forming part of the Balance Sheetas at March 31, 2008 and the Revenue Account fo r the period September 18, 2007 to March 31,2008SCHEDULE 5 Growth Daily Divi dend Tot al
Opt ion ReinvestmentOption
Reserves a nd Surplus March 31, 2008 March 31, 2008 March 31, 2008
Rupees Rupees Rupees
Unit Premi um Reserve (Note 2.6)
Added during the period (77,008,410) (31,928) (77,040,338)
Transferred to Revenue Account - - -
At the end of the period (77,008,410) (31,928) (77,040,338)
Income Equalisa tion Reserve (Note 2.7)
Added during the period 64,653,125 (99,440) 64,553,685
Transferred to Revenue Account (64,653,125) 99,440 (64,553,685)
At the end of the period - - -
Reserve Fund
Balance Transferred from Revenue Account 140,898,076 1,006,349 141,904,425
At the end of the period 140,898,076 1,006,349 141,904,425
TOTAL 63,889,666 974,421 64,864,087
SCHEDULE 6 March 31, 2008
Current Liabili ties and Provisi ons Rupees
Current Liabili ties
Investment Management and Advisory Fees 777,166
Transfer Agent Fees and Expenses 71,528
Trusteeship Fees and Expenses 34,189
Custodian Fees and Expenses 25,121
Audit Fees 225,000
Selling and Distribution Expenses 136,407
Inter Scheme payable
- For Switch - Out 376,359,235
- For Others 12,000
Dividend Payable 21
Sundry Payables 697,908
TOTAL 378,338,575
SCHEDULE 7 September 18, 2007
Interes t and Disc ount (Note 2.4) to March 31, 2008
Rupees
Commercial Paper / Certificate of Deposit 76,311,615
Reverse Repos 4,708,438
Collateralized Borrowing and Lending Obligation 1,498,434
Deposits 260,822
Margin Deposit with the Clearing Corporation of India Limited 2,041
Debentures / Bonds 31,517,310
TOTAL 114,298,660
33
Statement of Portfo lio Holding as at March 31,2008(Referred to in Schedu le 1 to the Balance Sheet as at March 31,2008 and th e Revenue Account
fo r the period September 18, 2007 to March 31, 2008)
Descri pt ion Quant ity Fair Val ue
Rupees
COMMERCIAL PAPER / CERTIFICATE OF DEPOSIT (100 %)
COMMERCIAL PAPER (13.75 %)
NON BANK ING FINANCE COMPANY (100%)
Fullerton India Credit Co. Ltd. (11/11/2008)# 2500 238,589,240
Fullerton India Credit Co. Ltd. (08/05/2008)# 2000 198,593,079
CERTIFICATE OF DEPOSIT (86.25 %)
BANK S (100%)
State Bank Of Mysore (28/05/2008)# 3394 335,279,175
State Bank of India (29/05/2008)# 3000 295,898,795
State Bank Of Patiala (29/05/2008)# 2500 246,715,490
State Bank Of Saurashtra (10/06/2008)# 2500 246,227,606
State Bank Of Mysore (11/06/2008)# 2500 245,828,750
State Bank of Hyderabad (25/09/2008)# 2500 240,699,477
State Bank Of Travancore (03/10/2008)# 2500 240,296,285
ICICI Bank Ltd. (27/02/2009)# 2500 229,322,284
Oriental Bank of Commerce (25/03/2009)# 2500 228,198,144
State Bank of Hyderabad (12/06/2008)# 2000 196,073,656
State Bank Of Patiala (06/06/2008)# 1500 147,760,715
ICICI Bank Ltd. (17/02/2009)# 965 90,173,395
TOTAL (Cost Rs 3,179,656,091) 3,179,656,091
Confirmation has been received from Deutsche Bank AG , Mumbai Branch at the end of financial period for investments held by them.
# Fair value of non-traded and thinly traded debt securities as determined JPMorgan Asset Management India Private Limited underprocedures approved by the trustee in accordance with the guidelines for valuation of securities for mutual funds dated September 18, 2000and amendments thereto as applicable issued by the Securities and Exchange Board of India.
Ann exure I
Discl osure und er Regu lation 25 (11) of the Securi ties and Exchange Board of Ind ia (Mutu al Fund s) Regu lations 1996 as ame nded
JPMorgan Mutu al Fund has made fo llowing investments in companies or their s ubsidiaries w hich ho ld units in excess of 5% of the netasse t value of any sc heme of JPMorgan Mutu al Fund fo r the period ended March 31,2008
Rupees
Name of the Company Schemes invested Investments made by Agg regated for Outstanding as onin by the Company the Schemes of JP Morgan the period under March 31, 2008 at
Mutual Fund in the Regulation 25(11) Market/ FairCompany or its subsidiary at Cost Value
DSP Merrill Lynch Capital Limited JPMorgan India Liquid Fund JPMorgan India Equity Fund 817,500,000 -JPMorgan India Liquid Fund 1,619,110,100 -JPMorgan India Liquid Plus Fund 2,756,549,938 -JPMorgan India SmallerCompanies Fund 192,000,000 -
Finolex Cables Limited JPMorgan India Liquid Plus Fund JPMorgan India Equity Fund 410,781,693 -JPMorgan India SmallerCompanies Fund 500,000,000 -
Global Trade Finance Limited JPMorgan India Liquid Plus Fund JPMorgan India Smaller 500,000,000 -Companies Fund
HDFC Bank Limited JPMorgan India Liquid Plus Fund JPMorgan India Equity Fund 333,203,752 246,174,750JPMorgan India Liquid Fund JPMorgan India Smaller 147,381,657 -
Companies FundHousing Development Finance JPMorgan India Liquid Fund JPMorgan India Equity Fund 960,590,509 662,953,135Corporation Limited JPMorgan India Smaller
Companies Fund 233,165,914 -Infrastructure Development Finance JPMorgan India Liquid Fund JPMorgan India Equity Fund 191,326,192 155,014,184Company Limited JPMorgan India Liquid Plus FundLarsen and Toubro Limited JPMorgan India Liquid Fund JPMorgan India Equity Fund 957,833,357 355,804,232
JPMorgan India Liquid Plus Fund JPMorgan India SmallerCompanies Fund 281,970,666 -
LIC Housing Finance Limited JPMorgan India Liquid Plus Fund JPMorgan India Liquid Plus Fund 100,000,000 100,090,340Tata Consultancy Services Limited JPMorgan India Liquid Plus Fund JPMorgan India Equity Fund 204,243,470 -
34
Schedules forming part of the Balance Sheetas at March 31, 2008 and the Revenue Account fo r the period September 18, 2007 to March 31, 2008Schedu le 8
Notes to the Financial S tatements
1 Organisation
JPMorgan India Liquid Fund (the”Scheme”) is an open-ended liquid scheme of JPMorgan Mutual Fund (the “Fund”) and was launchedon September 18, 2007. JPMorgan Mutual Fund has been sponsored by JPMorgan Asset Management (Asia) Inc. JPMorgan AssetManagement India Private Limited incorporated under the Companies Act, 1956 has been appointed as the asset managementcompany. The duration of the Scheme is perpetual. The Scheme closed for initial subscription on September 20, 2007 and reopenedfor issue and redemption of units on September 21, 2007. The investment objective of the Scheme is to provide reasonable returns,commensurate with low risk while providing a high level of liquidity, through a portfolio of money market and debt securities. TheScheme has two options - Growth and Daily Dividend Reinvestment Option.
The Scheme will not declare dividend under the Growth Option in normal circumstances. The income earned on such units will remaininvested within the Scheme and will be reflected in the net asset value.
2 Sign ificant Account ing Policies
2.1 Basis Of Accounting
The Scheme maintains its books of account on an accrual basis. These financial statements have been prepared in accordancewith the accounting policies and standards specified in the Ninth Schedule of the Securities and Exchange Board of India(SEBI)(Mutual Funds) Regulations, 1996 (“the Regulation”) and amendments thereto, as applicable.
2.2 Portfolio Valuation
Investments are stated at market / fair value at the Balance Sheet date / date of determination. In valuing the Scheme’sinvestments:
(i) Debt securities listed on a recognised stock exchange are valued at the last quoted closing price on the National StockExchange of India Limited (NSE). If no sale is reported at that time , such security is valued at fair value as determined ingood faith by JPMorgan Asset Management India Private Limited under procedures approved by the Trustee of JP MorganMutual Fund.
(ii) Non traded and thinly traded debt securities are valued at fair value as determined by JPMorgan Asset Management IndiaPrivate Limited under procedures approved by the Trustee of JP Morgan Mutual Fund in accordance with the guidelines forvaluation of securities for mutual funds dated September 18, 2000 and amendments thereto, as applicable issued by SEBI.
(iii) Privately placed debt securities are valued at fair value as determined in good faith by JPMorgan Asset Management IndiaPrivate Limited under procedures approved by the Trustee of JPMorgan Mutual Fund.
(iv) Traded money market securities are valued at the yield at which they are traded on the valuation date. If no sale is reportedat that time, such security is valued at the last traded price plus accretion of the difference between the face value andthe last traded price. Non traded money market instruments are valued at cost plus accrued interest.
(v) Instruments bought on ‘repo’ basis are valued at the resale price after deduction of applicable interest up to the date ofresale.
Following the issue of the guidance note on accounting for investments in the financial statements of mutual funds by theInstitute of Chartered Accountants of India (pursuant to the Eleventh Schedule of the SEBI Regulations), net unrealisedappreciation/ depreciation in the value of investments is determined separately for each category of investments. Furtherin respect of each category of investments, the change in the net unrealised appreciation if any, between two balancesheet dates/ valuation dates is accounted through the Unrealized Appreciation Reserve and net unrealized depreciation,if any, is accounted through the Revenue Account.
Unrealised appreciation is reduced from the distributable income at the time of income distribution.
2.3 Securities Transactions
Investment securities transactions are accounted for on a trade date basis. The Scheme uses the average cost method fordetermining the reliased gain or loss on sale of investments.
2.4 Investment Income
Interest income is recorded on an accrual basis.
2.5 Net Asset Value for Growth / Daily Dividend Reinvestment Option
The net asset value of the units of the Scheme is determined separately for the units issued under the Growth and Daily DividendReinvestment Option.
For reporting the net asset value for the Options, daily income earned, including realized and unrealized gain or loss in the valueof investments and expenses incurred by the Scheme are allocated to the Options in proportion to the value of the unitsoutstanding.
2.6 Unit Premium Reserve
Upon issue and redemption of units, the net premium or discount to the face value of units is adjusted against the unit premiumreserve of the Scheme after an appropriate portion of the issue proceeds and redemption payout is credited or debitedrespectively to the income equalization reserve.
The unit premium reserve is available for dividend distribution except to the extent it is represented by unrealized net appreciationin value of investments.
2.7 Income Equalization Reserve
The net distributable income relating to units issued / repurchased is transferred to / from income equialisation reserve fordetermining the net surplus / deficit, transferred from / to unit premium reserve.
3 Income Taxes
No provision for taxation has been made as the Scheme qualifies as a recognized mutual fund under Section 10 (23D) of the IncomeTax Act, 1961.
35
4 Investment Management Fees
The Scheme has paid or provided for investment management and advisory fees payable to the JPMorgan Asset Management IndiaPrivate Limited for managing the Scheme at an average annual rate of 0.09% of the average daily net asset values recorded by theScheme. All costs, charges and expenses incurred by JPMorgan Asset Management India Private Limited in the administartion andexecution of the activities of the Scheme, except costs allowed to be charged to the Scheme under the Regulations are on their ownaccount for which they receive investment management fees.
5 Trustee Fees
In accordance with the Trust Deed dated December 4, 2006 between the JPMorgan Asset Management (Asia) Inc. (the “Settlor”) andJPMorgan Mutual Fund Private Limited, the Scheme has paid or provided for trustee fees payable to the Trustee at an annual rate of0.05% of the average daily net asset values recorded by the Schemes of the Fund or Rs. one crore per annum, whichever is lower.
6 Custod ian Fees
Deutsche Bank AG, Mumbai Branch provides custodial services to the Scheme for which it receives custody fees.
7 Limi tation on Expenses
The total expenses chargeable to the Scheme are limited to 0.23% (annualized) of the average daily net assets of the Scheme.JPMorgan Asset Management India Private Limited has borne Rs. 315,299 in excess of the above mentioned percentage of theaverage daily net assets to be charged to the Scheme as total expenses for the period.
8 Agg regate Fair Val ue of Non-T raded/ Priva tely Place d Investments
Aggregate fair value of non traded (including privately placed) investments as determined by JPMorgan Asset Management IndiaPrivate Limited under the procedures approved by the Trustee is Rs. 3,179,656,091.
9 Agg regate Value Of Purchases And Sales Of Inves tments
The aggregate value of investment securities purchased and sold (including matured) during the period is Rs. 52,942,501,980(excluding accretion of discount Rs.77,810,049) and Rs. 49,841,493,678 respectively being 3799.38% (annualized) and3576.84%(annualized) of the average daily net assets.
10 Income And Expenses
The total income (including net profit on sale of investments) and expenditure during the period is Rs. 113,035,099 and Rs. 3,142,432respectively being 8.11% (annualised) and 0.23% (annualised) of the average daily net assets.
11 Miscella neous Income
Miscellaneous income Rs. (2,101,301) represents amount paid to other schemes of the Fund on account of movement of inter schemeswitch out funds to the other schemes calculated for the period on the basis of NSE Mibor.
12 Discl osure Under Regu lation 25(11) Of The Securi ties and Exchang e Bo ard Of Ind ia (Mutu al Fund s) Regu lations, 1996, AsAmended
JPMorgan Mutual Fund has made investments in companies, which hold / have held units in excess of 5% of the net asset value ofany scheme of JPMorgan Mutual Fund which have been listed in Annexure I.
13 Discl osure Under Regulation 25(8) of the Securi ties and Exchang e Board of Ind ia (Mutu al Fund s ) Regu lation , 1996 as amended(SEBI Regu lations) and in accordance wi th Account ing Standard 18 on ‘Related Party Discl osures’ iss ued by the Institut e ofChartered Account ants of Ind ia (ICAI)
The Scheme has entered into transactions with certain related parties. The information required in this regard in accordance withAccounting Standard 18 on ‘Related Party Disclosures’ issued by the Institute of Chartered Accountants of India and Regulation 25(8)of SEBI Regulation, is provided below :
(i) Related Party Relationships du ring the period
Name Descri pt ion of Relationship
JPMorgan Asset Management (Asia) Inc.* Sponsor of the Fund
JPMorgan Asset Management India Private Limited Investment Manager to the Schemes of JPMorgan Mutual Fund
JPMorgan Mutual Fund Private Limited Trustee to the Schemes of JPMorgan Mutual Fund
Mahindra And Mahindra Financial Services Limited Associate of the Investment Manager
LIC Housing Finance Limited
Finolex Industries Limited Associate of the Trustee of the Schemes of JPMorgan Mutual Fund
Bank of Baroda
GTL Infrastructure Limited
Global Trade Finance Limited
* - There were no transactions during the period
(ii ) Schemes of the Fund , und er common cont rol of the Spon sor during the period
JPMorgan India Equity Fund
JPMorgan India Liquid Plus Fund
JPMorgan India Smaller Companies Fund
(iii ) Key Management Personn el and their Relatives during the period
Krishnamurthy Vijayan - Whole-time director and CEO, JPMorgan Asset Management India Private Limited
Usha Vijayan* (Relative of Key Management Personnel)
Keshav Vijayan* (Relative of Key Management Personnel)
* - There were no transactions during the period
36
(iv) Transac tions during the period
Rupees
Natu re of Transaction Trustee Associate Invest ment Associate of Scheme of the Key Management Totalof Trustee Manager Investment Fund under Personnel and
Manager Common Control their Relativesof the Sponsor
Purchase of Investments - - - 660,000,000 16,180 ,456,586 - 16,840,456,586
Sale of Investments - - - 660,375,711 18,328 ,284,646 - 18,988,660,357
Subscription of Units(including switch in anddividend reinvestment) - 4,151,408,228 10,053,847 500,036,075 - 3,245,313 4,664,743,463
Redemption of Units(including switch out) - 4,154,764,816 10,053,847 500,101,784 - 3,245,433 4,668,165,880
Dividend(Including dividendreinvested) - 8,228 53,847 36,075 - 40,313 138,463
Investment Managementand Advisory Fees - 1,250,869 - - - 1,250,869
Trusteeship Fees andExpenses 194,262 - - - - 194,262
Reimbrusementof Expenses - - 315,299 - - - 315,299
(v) Outstanding as at period end
Rupees
Nature of Transaction Trustee Associate Investment Asso ciate of Scheme of the Key Management Totalof Trustee Manager Investment Fund under Personnel and
Manager Common Control their Relativesof the Sponsor
Investment ManagementFees Payable - - 777,166 - - - 777,166
Trusteeship Fees Payable 34,189 - - - - - 34,189
Other Payables - - - - 12,000 - 12,000
Other Receivables - - 153,267 - - - 153,267
(vi ) Discl osures i n respect of material transactions wi th parties re ferred to in Note 13(i) fo r Associa te of Inves tment Manager
Rupees
September 18, 2007to March 31, 2008
Purchase of Inves tments
Mahindra and Mahindra Financial Services Limited 660,000,000
Sale of Inves tments
Mahindra and Mahindra Financial Services Limited 660,375,711
Subscri pt ion of Units (includ ing swi tch in and divi dend reinves tment)
LIC Housing Finance Limited 300,000,000
Mahindra and Mahindra Financial Services Limited 200,036,075
Redemption of Units (includ ing swi tch out)
LIC Housing Finance Limited 300,065,709
Mahindra and Mahindra Financial Services Limited 200,036,075
Divi dend (Including divi dend reinves ted)
Mahindra and Mahindra Financial Services Limited 36,075
37
(vii ) Discl osures i n respect of material transac tion s wi th parties re ferred to in Note 13(i) for Ass ocia te of Trustee
Rupees
September 18, 2007to March 31, 2008
Subscri pt ion of Units (includ ing swi tch in and divi dend reinves tment)
Finolex Industries Limited 88,000,000
Bank of Baroda 400,000,000
GTL Infrastructure Limited 223,408,228
Global Trade Finance Limited 3,440,000,000
Redemption of Units (includ ing swi tch out)
Finolex Industries Limited 88,019,690
Bank of Baroda 401,110,836
GTL Infrastructure Limited 223,537,866
Global Trade Finance Limited 3,442,096,424
Divi dend ( Including divi dend reinves ted)
GTL Infrastructure Limited 8,228
(viii ) Details of material transac tions wi th respect to parties re ferred to in Note 13 (ii ) fo r Schemes und er common cont rol of theSponsor
Rupees
September 18, 2007to March 31, 2008
Purchase of Inves tments
JPMorgan India Equity Fund 1,692,477,977
JPMorgan India Liquid Plus Fund 13,479,168,802
JPMorgan India Smaller Companies Fund 1,008,809,807
Sale of Inves tments
JPMorgan India Equity Fund 1,806,439,320
JPMorgan India Liquid Plus Fund 15,399,965,091
JPMorgan India Smaller Companies Fund 1,121,880,235
Other payable
JPMorgan India Equity Fund 12,000
(ix) Discl osures i n respect of material transactions wi th persons re ferred to in Note 13 (iii ) for key ma nagement personn el andtheir rela tives
Rupees
September 18, 2007to March 31, 2008
Subscri pt ion of Units (includ ing swi tch in and divi dend reinves tment)
Krishnamurthy Vijayan 3,245,313
Redemption of Units (includ ing swi tch out)
Krishnamurthy Vijayan 3,245,433
Divi dend (Including divi dend reinves ted)
Krishnamurthy Vijayan 40,313
14 Prior Year Comparatives
As these are the first financial statements of the Scheme since the date of its commencement, there are no comparative figures.
K. H. VACHHA Fo r and on behalf of For and on behalf of
Partner JPMorgan Asset Management Ind ia Priva te Limi ted JPMorgan Mutu al Fund IndiaFor and on behalf of Priva te Limi ted
PRICE WATERHOUSE Mr. Kris hnamurthy Vijaya n Mr. Jagadish Salunkhe
Chartered Accountants Whole-time director and CEO Chairman
Mr. K. G. Vassal Dr. Dharmendra Bhandari
Director Director
Mr. Nandkumar R Surti
CIO - Fixed Income and Fund Manager
Place: Mumbai
Date: September 29, 2008
38
Auditors’ ReportTo
The TrusteeJPMORGAN MUTUAL FUND
1. We have audited the Balance Sheet of JPMorgan Mutual Fund – JPMorgan India Liquid Plus Fund (The “Scheme”) as at March 31, 2008and, the related Revenue Account for the period September 18, 2007 to March 31, 2008, both of which we have signed under referenceto this report. These financial statements are the responsibility of the Board of Trustees of JPMorgan Mutual Fund and the Managementof JPMorgan Asset Management India Private Limited (the “Management”). Our responsibility is to express an opinion on these financialstatements based on our audit.
2. We have conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we planand perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. Anaudit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Ourprocedures included confirmation of securities owned at March 31, 2008 by correspondence with the custodian. An audit also includesassessing the accounting principles used and significant estimates made by the management, as well as evaluating the overallfinancial statements presentation. We believe that our audit provides a reasonable basis for our opinion.
3. We have obtained all the information and explanations which, to the best of our knowledge and belief, were necessary for the purposesof our audit. The Balance Sheet and the Revenue Account referred to above are in agreement with the books of account of the Scheme.
4. In our opinion and to the best of our information and according to the explanations given to us ;
(i) The Balance Sheet and the Revenue Account together with the notes thereon give the information required by the Securities andExchange Board of India (Mutual Funds) Regulations, 1996 and the amendments thereto, as applicable, and also give respectivelya true and fair view of the state of affairs of JPMorgan Mutual Fund – JPMorgan India Liquid Plus Fund as at March 31, 2008 andits net surplus for the period September 18, 2007 to March 31, 2008.
(ii) The Balance Sheet as at March 31, 2008, and the Revenue Account for the period September 18, 2007 to March 31, 2008,together with the notes thereon, have been prepared in all material respects in accordance with the accounting policies andstandards specified in the Ninth Schedule of the Securities and Exchange Board of India (Mutual Funds) Regulations, 1996 andamendments thereto, as applicable.
(iii) The method used to value
(i) privately placed debt securities in good faith and
(ii) non traded and thinly traded debt securities in accordance with the guidelines for valuation of securities for mutual fundsdated September 18, 2000 and amendments thereto as applicable issued by the Securities and Exchange Board of Indiaas at March 31, 2008 as determined by JPMorgan Asset Management India Private Limited under procedures approved bythe Trustee of JPMorgan Mutual Fund are fair and reasonable.
K. H. VachhaPartnerMembership No. F/30798
For and on behalf of
PRICE WATERHOUSEChartered Accountants
MumbaiSeptember 29, 2008
39
Balance Sheet as at March 31, 2008
March 31, 2008
Schedule Rupees
Investments 1 3,299,652,001
Deposits 2 2,500,000
Other Current Assets 3 404,340,670
TOTAL 3,706,492,671
LIABILITIES
Unit Capital 4 3,639,345,145
Reserves and Surplus 5 55,484,405
Current Liabilities and Provisions 6 11,663,121
TOTAL 3,706,492,671
March 31, 2008 March 31, 2008 March 31, 2008RECONCILIATION OF NET ASSET VALUE PER UNIT Daily Divi dend
Growth Opt ion Reinvestment Option Tot alRupees Rupees Rupees
Net Assets as per Balance Sheet(Total Assets less Current Liabilities and Provisions)(Note 2.5) 1,248,220,765 2,446,608,785 3,694,829,550
Number of Units in Issue 119,490,492.498 244,444,021.940 -
Net Asset Value per Unit 10.446 10.009
Notes to the Financial Statements. 8
The Schedules referred to herein form an integral part of theFinancial Statements.
This is the Balance Sheet referred to in our report of even date.
K. H. VACHHA For and on behalf of Fo r and on behalf ofPartner JPMorgan Asset JPMorgan Mutu al Fund
Management Ind ia Priva te Limi ted Ind ia Priva te Limi ted
For and on behalf of
PRICE WATERHOUSE Mr. Kris hnamurth y Vijaya n Mr. Jagadish SalunkheChartered Accountants Whole-time director and CEO Chairman
Mr. K. G. Vassal Dr. Dharmendra BhandariDirector Director
Place : Mumbai Mr. Nand kumar R SurtiDate : September 29, 2008 CIO - Fixed Income and Fund Manager
40
Revenue Account for the period September 18, 2007 to March 31, 2008
September 18, 2007 toMarch 31, 2008
Schedule Rupees
INCOME AND GAINS
Interest and Discount 7 257,047,768
Net Profit on Sale of Investments (including Net Profit on Inter Scheme Sale ofInvestments of Rs. 1,010,426) (Note 2.3) 10,306,095
Miscellaneous Income (Note 12) 2,267,929
TOTAL 269,621,792
EXPENSES AND LOSSES
Investment Management and Advisory Fees (Note 4) 5,533,128
Transfer Agent Fees and Expenses 2,122,515
Trusteeship Fees and Expenses (Note 5) 134,782
Custodian Fees and Expenses (Note 6) 375,064
Audit Fees 335,000
Selling and Distribution Expenses 2,627,861
Other Operating Expenses 521,972
TOTAL 11,650,322
Less: Expenses to be Reimbursed by the Investment Manager (Note 7) 649,662
TOTAL 11,000,660
Net Surplus fo r the Peri od 258,621,132
Net Unrealised Depreciation in Value of Investments (3,731,236)
Net Surplus including Net Unrealise d Deprecia tion in Value of Inves tments 254,889,896
September 18, September 18, September 18,2007 to 2007 to 2007 to
March 31, 2008 March 31, 2008 March 31, 2008Growth Opt ion Daily Divi dend
Reinvestment Opt ion Tot al
Rupees Rupees Rupees
Net Surplus for the Period including Net Unrealised Depreciationin Value of Investments by Option 136,967,313 117,922,583 254,889,896
Transfer from Income Equalisation Reserve (Note 2.7) (83,751,886) 1,143,416 (82,608,470)
Dividend Distributions - (95,688,749) (95,688,749)
Dividend Tax thereon - (21,170,257) (21,170,257)
Balance Transferred to Reserve Fund 53,215,427 2,206,993 55,422,420
Notes to the Financial Statements. 8
The Schedules referred to herein form an integral part of theFinancial Statements.
This is the Revenue Account referred to in our report of even date.
K. H. VACHHA For and on behalf of Fo r and on behalf ofPartner JPMorgan Asset JPMorgan Mutu al Fund
Management Ind ia Priva te Limi ted Ind ia Priva te Limi ted
For and on behalf of
PRICE WATERHOUSE Mr. Kris hnamurth y Vijaya n Mr. Jagadish SalunkheChartered Accountants Whole-time director and CEO Chairman
Mr. K. G. Vassal Dr. Dharmendra BhandariDirector Director
Place : Mumbai Mr. Nand kumar R SurtiDate : September 29, 2008 CIO - Fixed Income and Fund Manager
41
Schedules forming part of the Balance Sheetas at March 31, 2008 and the Revenue Account fo r the period September 31, 2008
March 31, 2008 March 31, 2008Fair Value Cost
Rupees Rupees
SCHEDULE 1
Investments(Notes 2.2, 2.3, 8, 9, 10 and 13)(Refer to the attached Statement of Portfolio Holding as at March 31, 2008)
Non Convertible Debentures / Bonds Listed / Awaiting Listing 99,493,354 100,057,700
Privately Placed Non Convertible Deventures / Bonds 597,046,610 600,213,500
Certificate of Deposit 2,603,112,037 2,603,112,037
TOTAL 3,299,652,001 3,303,383,237
March 31, 2008Rupees
SCHEDULE 2
Deposits
Margin Deposit with Clearing Corporation of India towards Collateralized Borrowing and Lending Obligation 2,500,000
TOTAL 2,500,000
March 31, 2008Rupees
SCHEDULE 3
Oth er Current Asse ts
Balances with Banks - in Current Account 1,027,925
Unit Subscriptions Receivable 224,398
Inter-Scheme Receivable for Switch in 377,707,151
Interest Receivable Debentures / Bonds 24,832,466
Receivable from Investment Manager 548,730
TOTAL 404,340,670
Schedu les fo rmi ng part of the Balance Sheet as at March 31, 2008
and the Revenue Account fo r the period September 18, 2007 to March 31, 2008
March 31, 2008 March 31, 2008Rupees Units
SCHEDULE 4
Unit Capital
Growth Opt ion
Issued and Subscri bed :
Units of Rs.10 each fully paid up 5,075,137,276 507,513,727.545
Outstanding:
Initial Issue and Subscription 5,075,137,276 507,513,727.545
Issued during the period 21,862,017,337 2,186,201,733.747
26,937,154,613 2,693,715,461.292
Redeemed during the period 25,742,249,688 2,574,224,968.794
At the end of the period 1,194,904,925 119,490,492.498
Daily Divi dend Reinves tment Opt ion
Issued and Subscri bed :
Units of Rs.10 each fully paid up 1,202,880,000 120,288,000.000
Outstanding:
Initial Issue and Subscription 1,202,880,000 120,288,000.000
Issued during the period 17,312,468,418 1,731,246,841.731
18,515,348,418 1,851,534,841.731
Redeemed during the period 16,070,908,198 1,607,090,819.791
At the end of the period 2,444,440,220 244,444,021.940
TOTAL 3,639,345,145 363,934,514.438
42
Growth Opt ion Daily Divi dend Tot alReinvestment Opt ion
March 31, 2008 March 31, 2008 March 31, 2008Rupees Rupees Rupees
SCHEDULE 5
Reserves a nd Surplus
Unit Premi um Reserve (Note 2.6)
Added during the period 100,413 (38,428) 61,985
At the end of the period 100,413 (38,428) 61,985
Income Equalisa tion Reserve (Note 2.7)
Added during the period (83,751,886) 1,143,416 (82,608,470)
Transferred to Revenue Account 83,751,886 (1,143,416) 82,608,470
At the end of the period - - -
Reserve Fund
Balance Transferred from Revenue Account 53,215,427 2,206,993 55,422,420
At the end of the period 53,215,427 2,206,993 55,422,420
TOTAL 53,315,840 2,168,565 55,484,405
March 31, 2008Rupees
SCHEDULE 6
Current Liabili ties and Provisi ons
Current Liabili ties
Investment Management and Advisory Fees 2,621,840
Transfer Agent Fees and Expenses 265,257
Trusteeship Fees and Expenses 19,618
Custodian Fees and Expenses 49,148
Audit Fees 335,000
Selling and Distribution Expenses 340,000
Unit Redemptions Payable 5,137,785
Inter Scheme payable
- For Switch - Out 1,062,658
- For Others 40,673
Dividend Distribution Tax Payable 1,599,938
Sundry Payables 191,204
TOTAL 11,663,121
September 18, 2007 toMarch 31, 2008
Rupees
SCHEDULE 7
Interest and Disc ount(Not e 2.4)
Debentures / Bonds 107,166,069
Commercial Paper / Certificate of Deposit 144,608,293
Reverse Repos 4,864,655
Collateralized Borrowing and Lending Obligation 147,347
Margin Deposit with the Clearing Corporation of India Limited 582
Deposits 260,822
TOTAL 257,047,768
Schedules forming part of the Balance Sheetas at March 31, 2008 and the Revenue Account fo r the period September 31, 2008
43
Description Quant ity Fair ValueRupees
NON CONVERTIBLE DEBENTURES/BONDS LISTED / AWAITING LISTING (3.02 %)
FINANCE (100%)
9.22% Sundaram Finance Limited (29/10/2009)# 100 99,493,354
Total (Cost Rs. 100,057,700) 99,493,354
PRIVATELY PLACED NON CONVERTIBLE DEBENTURES/BONDS (18.09 %)
FINANCE (16.76%)
9.75% LIC Housing Finance Ltd. (24/09/2009)* @ 100 100,090,340
Total (Cost Rs. 100,000,000) 100,090,340
NON BANK ING FINANCE COMPANY (83.24%)
9.05% GE Capital Services India (17/10/2009)* 500 496,956,270
Total (Cost Rs. 500,213,500) 496,956,270
Total (Cost Rs. 600,213,500) 597,046,610
CERTIFICATE OF DEPOSIT (78.89 %)
BANK S (100 %)
ICICI Bank Ltd. (10/03/2009)# 5000 456,945,499
Industrial Develop Bank Of India (12/03/2009)# 4500 411,880,781
State Bank Of Bikaner & Jaipur (29/05/2008)# 2500 246,841,598
State Bank of Hyderabad (12/06/2008)# 2500 246,106,857
National Bank for Agri. & Rural Dev (09/10/2008)# 2500 239,738,552
Canara Bank (15/10/2008)# 2500 239,679,140
State Bank Of Travancore (25/11/2008)# 2500 234,853,360
State Bank Of Bikaner & Jaipur (08/12/2008)# 2500 234,159,474
Punjab National Bank (06/01/2009)# 2500 232,635,440
ICICI Bank Ltd. (17/02/2009)# 645 60,271,336
Total (Cost Rs. 2,603,112,037) 2,603,112,037
Total Investments (Cost Rs. 3,303,383,237) 3,299,652,001
Confirmation has been received from Deutsche Bank AG , Mumbai Branch at the end of financial period for investments held by them.
# Fair value of non-traded and thinly traded debt securities as determined by JPMorgan Asset Management India Private Limited underprocedures approved by the Trustee in accordance with the guidelines for valuation of securities for mutual funds dated September 18, 2000and amendments thereto as applicable issued by Securities and Exchange Board of India.
* Fair value of privately placed securities as determined in good faith by JPMorgan Asset Management India Private Limited underprocedures approved by the Trustee.
@ Investment in companies which have invested more than 5% of the net asset value of any scheme of JPMorgan Mutual Fund.
Statement of Portfo lio Holding as at March 31,2008(Referred to in Schedu le 1 to the Balance Sheet as at March 31,2008 and the Revenu e Account fo r the period September 18, 2007 toMarch 31, 2008)
44
Annexure IDiscl osure und er Regu lation 25 (11) of the Securi ties and Exchange Board of Ind ia (Mutu al Fund s) Regu lations 1996 as amendedJPMorgan Mutu al Fund has made fo llowing investments in companies or their s ubsidiaries w hich ho ld units in excess of 5% of the net
asse t value of any sc heme of JPMorgan Mutu al Fund fo r the period end ed March 31, 2008
Rupees
Name of the Company Schemes invested Investments made by Agg regated for Outstanding as onin by the Company the Schemes of JP Morgan the period under March 31, 2008 at
Mutual Fund in the Regulation 25(11) Market/ FairCompany or its subsidiary at Cost Value
DSP Merrill Lynch Capital Limited JPMorgan India Liquid Fund JPMorgan India Equity Fund 817,500,000 -JPMorgan India Liquid Fund 1,619,110,100 -JPMorgan India Liquid Plus Fund 2,756,549,938 -JPMorgan India SmallerCompanies Fund 192,000,000 -
Finolex Cables Limited JPMorgan India Liquid Plus Fund JPMorgan India Equity Fund 410,781,693 -JPMorgan India SmallerCompanies Fund 500,000,000 -
Global Trade Finance Limited JPMorgan India Liquid Plus Fund JPMorgan India Smaller 500,000,000 -Companies Fund
HDFC Bank Limited JPMorgan India Liquid Plus Fund JPMorgan India Equity Fund 333,203,752 246,174,750JPMorgan India Liquid Fund JPMorgan India Smaller 147,381,657 -
Companies FundHousing Development Finance JPMorgan India Liquid Fund JPMorgan India Equity Fund 960,590,509 662,953,135Corporation Limited JPMorgan India Smaller
Companies Fund 233,165,914 -Infrastructure Development Finance JPMorgan India Liquid Fund JPMorgan India Equity Fund 191,326,192 155,014,184Company Limited JPMorgan India Liquid Plus FundLarsen and Toubro Limited JPMorgan India Liquid Fund JPMorgan India Equity Fund 957,833,357 355,804,232
JPMorgan India Liquid Plus Fund JPMorgan India SmallerCompanies Fund 281,970,666 -
LIC Housing Finance Limited JPMorgan India Liquid Plus Fund JPMorgan India Liquid Plus Fund 100,000,000 100,090,340Tata Consultancy Services Limited JPMorgan India Liquid Plus Fund JPMorgan India Equity Fund 204,243,470 -
45
Schedules forming part of the Balance Sheetas at March 31, 2008 and the Revenue Account for the period September 18, 2007 to March 31, 2008
Schedu le 8
Notes to the Financial S tatements
1 Organisation
JPMorgan India Liquid Plus Fund (the”Scheme”) is an open-ended income scheme of JPMorgan Mutual Fund (the “Fund”) and waslaunched on September 18, 2007. JPMorgan Mutual Fund has been sponsored by JPMorgan Asset Management (Asia) Inc. JPMorganAsset Management India Private Limited incorporated under the Companies Act, 1956 has been appointed as the asset managementcompany. The duration of the Scheme is perpetual. The Scheme closed for initial subscription on September 20, 2007 and reopened forissue and redemption of units on September 21, 2007. The investment objective of the Scheme is to provide liquidity and optimalreturns to the investors by investing primarily in a mix of short term debt and money market instruments which results in a portfoliohaving marginally higher maturity and moderately higher credit risk as compared to a liquid fund at the same time maintaining a balancebetween safety and liquidity. The Scheme has two options - Growth and Daily Dividend Reinvestment Option.The Scheme will notdeclare dividend under the Growth Option in normal circumstances. The income earned on such units will remain invested within theScheme and will be reflected in the net asset value.
2 Sign ificant Account ing Policies
2.1 Basis of Accounting
The Scheme maintains its books of account on an accrual basis. These financial statements have been prepared in accordancewith the accounting policies and standards spcecified in the Ninth Schedule of the Securities and Exchange Board ofIndia(SEBI)(Mutual Funds) Regulations, 1996 (“the Regulation”) and amendments thereto, as applicable.
2.2 Portfolio Valuation
Investments are stated at market / fair value at the Balance Sheet date / date of determination. In valuing the Scheme’sinvestments:
(i) Debt securities listed on a recognised stock exchange are valued at the last quoted closing price on the National StockExchange of India Limited (NSE). If no sale is reported at that time, such security is valued at fair value as determined ingood faith by JPMorgan Asset Management India Private Limited under procedures approved by the Trustee of JP MorganMutual Fund.
(ii) Non traded and thinly traded debt securities are valued at fair value as determined by JPMorgan Asset Management IndiaPrivate Limited under procedures approved by the Trustee of JPMorgan Mutual Fund in accordance with the guidelines forvaluation of securities for mutual funds dated September 18, 2000 and amendments thereto, as applicable issued by SEBI.
(iii) Privately placed debt securities are valued at fair value as determined in good faith by JPMorgan Asset Management IndiaPrivate Limited under procedures approved by the Trustee of JPMorgan Mutual Fund.
(iv) Traded money market securities are valued at the yield at which they are traded on the valuation date. If no sale is reportedat that time, such security is valued at the last traded price plus accretion of the difference between the face value andthe last traded price. Non traded money market instruments are valued at cost plus accrued interest.
(v) Instruments bought on ‘repo’ basis are valued at the resale price after deduction of applicable interest up to the date ofresale.
Following the issue of the guidance note on accounting for investments in the financial statements of mutual funds by theInstitute of Chartered Accountants of India (pursuant to the Eleventh Schedule of the SEBI Regulations), net unrealisedappreciation/ depreciation in the value of investments is determined separately for each category of investments. Furtherin respect of each category of investments, the change in the net unrealised appreciation if any, between two balance sheetdates/ valuation dates is accounted through the Unrealized Appreciation Reserve and net unrealized depreciation, if any,is accounted through the Revenue Account.Unrealised appreciation is reduced from the distributable income at the time ofincome distribution.
2.3 Securities Transactions
Investment securities transactions are accounted for on a trade date basis. The Scheme uses the average cost method fordetermining the reliased gain or loss on sale of investments. Transaction for purchase and sale of investments are recognisedas of the trade date.
2.4 Investment Income
Interest income is recorded on an accrual basis.
2.5 Net Asset Value for Growth / Daily Dividend Reinvestment Option
The net asset value of the units of the Scheme is determined separately for the units issued under the Growth and Daily DividendReinvestment Option.
For reporting the net asset value for the Options, daily income earned, including realized and unrealized gain or loss in the valueof investments and expenses incurred by the Scheme are allocated to the Options in proportion to the value of the unitsoutstanding.
2.6 Unit Premium Reserve
Upon issue and redemption of units, the net premium or discount to the face value of units is adjusted against the unit premiumreserve of the Scheme after an appropriate portion of the issue proceeds and redemption payout is credited or debitedrespectively to the income equalization reserve.The unit premium reserve is available for dividend distribution except to theextent it is represented by unrealized net appreciation in value of investments.
2.7 Income Equalization Reserve
The net distributable income relating to units issued / repurchased is transferred to / from income equalisation reserve fordetermining the net surplus / deficit, transferred from / to unit premium reserve.
3 Income Taxes
No provision for taxation has been made as the Scheme qualifies as a recognized mutual fund under Section 10 (23D) of the IncomeTax Act, 1961.
46
4 Investment Management Fees
The Scheme has paid or provided for investment management and advisory fees payable to the JPMorgan Asset Management IndiaPrivate Limited for managing the Scheme at an average annual rate of 0.18% of the average daily net asset values recorded by theScheme. All costs, charges and expenses incurred by JPMorgan Asset Management India Private Limited in the administartion andexecution of the activities of the Scheme, except costs allowed to be charged to the Scheme under the Regulations are on their ownaccount for which they receive investment management and advisory fees.
5 Trustee Fees
In accordance with the Trust Deed dated December 4, 2006 between the JPMorgan Asset Management (Asia) Inc. (the “Settlor”) andJPMorgan Mutual Fund India Private Limited (the Trustee), the Scheme has paid or provided for trustee fees payable to the Trustee atan annual rate of 0.05% of the average daily net asset values recorded by the Scheme of the Fund or Rs. one crore per annum,whichever is lower.
6 Custod ian Fees
Deutsche Bank AG, Mumbai Branch provides custodial services to the Scheme for which it receives custody fees.
7 Limi tation on Expenses
The total expenses chargeable to the Scheme are limited to 0.36% (annualised) of the average daily net assets of the Scheme.JPMorgan Asset Management India Private Limited has borne Rs. 649,662 in excess of the above mentioned percentage of the averagedaily net assets to be charged to the Scheme as total expenses for the period.
8 Agg regate App recia tion And Deprecia tion In The Value Of Investments
Aggregate appreciation and depreciation in the value of investments are as follows:
March 31, 2008 (Rupees)
Non Convertible Debentures and Bonds Listed / Awaiting Listing
- Appreciation -
- Depreciation 564,346
Privately Placed Non Convertible Debentures / Bonds
- Appreciation 90,340
- Depreciation 3,257,230
9 Agg regate Fair Val ue of Non-Traded/ Priva tely Place d Investments
Aggregate fair value of non traded (including private placed)/thinly traded investments as determined by JPMorgan Asset ManagementIndia Private Limited under the procedures approved is Rs. 3,299,652,001
10 Agg regate Value Of Purchases And Sales Of Investments
The aggregate value of investment securities purchased and sold (including matured) during the period is Rs. 77,147,951,103(excluding accretion of discount of Rs. 144,755,641) and Rs. 73,999,629,602 respectively being 1311.56% (annualised) and 2423.38%(annualised) of the average daily net assets.
11 Income And Expenses
The total income (including net profit on sale of investments and net unrealized depreciation in value of investments) and expenditureduring the period is Rs. 265,890,556 and Rs. 11,000,660 being 8.71% (annualised) and 0.36% (annualised) of the average daily netassets.
12 Miscella neous Income
Miscellaneous income Rs. 2,267,929 comprises of amounts aggregating Rs. 2,101,301 received from other schemes of the Fund onaccount of movement of inter scheme switch in funds from the other schemes calculated for the period on the basis of NSE Mibor andRs. 166,628 received from JPMorgan Asset Management India Private Limited on account of recording of unit capital transactionscalculated as the difference between the net asset value on the date of recording and the transaction date.
13 Discl osure Under Regulation 25(11) Of The Securi ties And Exchange Board Of India (Mutu al Fund s) Regulations, 1996, As Amended
JPMorgan Mutual Fund has made investments in companies, which hold / have held units in excess of 5% of the net asset value ofany scheme of JPMorgan Mutual Fund which have been listed in Annexure I.
14 Discl osure Under Regu lation 25(8) of the Securi t ies and Exchange Board of Ind ia (Mutu al Fund s ) Regulation , 1996 as amended(SEBI Regu lations) and in accordance wi th Account ing Stand ard 18 on ‘Related Party Discl osures’ iss ued by the Institut e ofChartered Account ants of Ind ia (ICAI)
The Scheme has entered into transactions with certain related parties. The information required in this regard in accordance withAccounting Standard 18 on ‘Related Party Disclosures’ issued by the Institute of Chartered Accountants of India and Regulation 25(8)of SEBI Regulation, is provided below :
(i) Related party rela tionships during the period
Name Descri pt ion of Relationship
JPMorgan Asset Management (Asia) Inc. * Sponsor of the Fund
JPMorgan Asset Management India Private Limited Investment Manager to the Schemes of JPMorgan Mutual Fund
JPMorgan Mutual Fund Private Limited Trustee to the Schemes of JPMorgan Mutual Fund
Mahindra And Mahindra Financial Services Limited Associate of the Investment Manager
LIC Housing Finance Limited
Finolex Industries Limited Associate of the Trustee of the Schemes ofGTL Infrastructure Limited JPMorgan Mutual FundGlobal Trade Finance Limited
* - There were no transactions during the period.
47
(ii ) Schemes of the Fund , und er common cont rol of the Spon sor during the Period
JPMorgan India Equity Fund
JPMorgan India Liquid Fund
JPMorgan India Smaller Companies Fund
(iii ) Key Management Personn el and their Relatives du ring th e Period
Krishnamurthy Vijayan - Whole-time director and CEO, JPMorgan Asset Management India Private Limited
Usha Vijayan* (Relative of Key Management Personnel)
Keshav Vijayan* (Relative of Key Management Personnel)
* - There were no transactions during the period.
(iv ) Transac tions during the periodRupees
Natu re of Transaction Trustee Associate of Invest ment Associate of Schemes under Key Management TotalTrustee Manager Investment Common Control Personnel a nd
Manager of Sponsor of their Relativesthe Fund
Purchase of Investments - - - 410,014,438 17,258,228,916 - 17,668,243,354
Sale of Investments - - - 310,184,769 20,080,748,815 - 20,390,933,584
Subscription of Units (includingswitch in and dividend reinvestment) - 1,925,389,570 10,058,842 500,565,416 - 11,145,511 2,447,159,339
Redemption of Units(including switch out) - 1,929,056,018 10,058,842 300,672,222 - 3,977,469 2,243,764,551
Dividend(Including dividend reinvested) - - 58,842 463,632 - 77 522,551
Investment Manager and Advisory Fees - - 5,533,128 - - - 5,533,128
Trustee Fees and Expenses 134,782 - - - - - 134,782
Reimbursement of Expenses - - 649,662 - - - 649,662
(v) Outstanding as at period endRupees
Nature of Transaction Trustee Associate of Investment A ssociate of Schemes under Key Management TotalTrustee Manager Investment Common Control Personnel a nd
Manager of Sponsor of their Relativesthe Fund
Investment Management andAdvisory Fees Payable - - 2,621,840 - - - 2,621,840
Trustee Fees Payable 19,618 - - - - - 19,618
Units Outstanding As AtPeriod End - - - 200,687,316 - 7,300,653 207,987,969
Other Payables - - - - 40,673 - 40,673
Other Receivables - - 548,730 - - - 548,730
(vi ) Discl osures i n respect of material transactions wi th parties re ferred to in Note 14 (i) in respect of Associa te of Inves tmentManager
September 18, 2007 toMarch 31, 2008
Rupees
Purchase of Inves tments
Mahindra and Mahindra Financial Services Limited 310,014,438
LIC Housing Finance Limited 100,000,000
Sale of Inves tments
Mahindra and Mahindra Financial Services Limited 310,184,769
Subscri pt ion of Units (includ ing swi tch in and divi dend reinves tment)
LIC Housing Finance Limited 300,065,709
Mahindra and Mahindra Financial Services Limited 200,499,707
Redemption of Units (includ ing swi tch out)
LIC Housing Finance Limited 100,172,515
Mahindra and Mahindra Financial Services Limited 200,499,707
Divi dend ( Including divi dend reinves ted)
Mahindra and Mahindra Financial Services Limited 463,632
Units Outstanding As At Period End
LIC Housing Finance Limited 200,687,316
48
(vii ) Discl osures i n respect of material transac tions wi th parties re ferred to in Note 14 (i) in respect of Associa te of Trustee
September 18, 2007 toMarch 31, 2008
Rupees
Subscri pt ion of Units (includ ing swi tch in and divi dend reinves tment)
Finolex Industries Limited 118,019,690
GTL Infrastructure Limited 67,113,293
Global Trade Finance Limited 1,740,256,587
Redemption of Units (includ ing swi tch out)
Finolex Industries Limited 118,622,360
GTL Infrastructure Limited 67,488,282
Global Trade Finance Limited 1,742,945,376
(viii ) Details of material transac tions wi th respect to parties re ferred to in Note 14 (ii ) fo r Schemes und er common cont rol of theSponsor.
September 18, 2007 toMarch 31, 2008
Rupees
Purchase of Inves tments
JPMorgan India Liquid Fund 15,399,965,091
JPMorgan India Smaller Companies Fund 889,209,145
JPMorgan India Equity Fund 969,054,680
Sale of Inves tments
JPMorgan India Equity Fund 4,089,176,740
JPMorgan India Liquid Fund 13,479,168,802
JPMorgan India Smaller Companies Fund 2,512,403,273
Other Payable
JPMorgan India Equity Fund 40,673
(ix ) Discl osures i n respect of material transactions wi th parties re ferred to in Note 14 (iii ) fo r key ma nagement personn el andtheir rela tives
September 18, 2007 toMarch 31, 2008
Rupees
Subscri pt ion of Units (includ ing swi tch in and divi dend reinves tment)
Krishnamurthy Vijayan 11,145,511
Redemption of Units (includ ing swi tch out)
Krishnamurthy Vijayan 3,977,469
Divi dend ( Including divi dend reinves ted)
Krishnamurthy Vijayan 77
Units Outstanding As At Period End
Krishnamurthy Vijayan 7,300,653
15 Prior Year Comparatives
As these are the first financial statements of the Scheme since the date of its commencement, there are no comparative figures.
K. H. VACHHA For and on behalf of Fo r and on behalf ofPartner JPMorgan Asset JPMorgan Mutu al Fund
Management Ind ia Priva te Limi ted Ind ia Priva te Limi ted
For and on behalf of
PRICE WATERHOUSE Mr. Kris hnamurthy Vijaya n Mr. Jagadish SalunkheChartered Accountants Whole-time director and CEO Chairman
Mr. K. G. Vassal Dr. Dharmendra BhandariDirector Director
Place : Mumbai Mr. Nandkumar R SurtiDate : September 29, 2008 CIO - Fixed Income and Fund Manager
JPMorgan JPMorg an JPMorg an JPMorg anInd ia India Smalle r Ind ia India
Equity Fund Comp anies Fund L iquid Fund L iqu id Plus Fund
Period ended Period ended Period ended Period endedMarch 31, 2008 March 31, 2008 March 31, 2008 March 31, 2008
1. NAV per unit (Rs.):
Open----noitpO htworG----noitpO tnemtsevnieR dnediviD yliaD
HighGrowth Option 15.346 10.622 10.4178 10.4461Daily Dividend Reinvestment Option 15.346 10.622 10.0079 10.0089
Low909.9noitpO htworG 6.612 10.0000 10.0000
Daily Dividend Reinvestment Option 9.568 6.612 10.0000 10.0000
EndGrowth Option 10.915 7.263 10.4178 10.4461Daily Dividend Reinvestment Option 10.138 7.263 10.0079 10.0089
2. Closing Assets Under Management (Rs. in Lakhs)92.849,6347.615,8221.212,8350.138,401dnE
Average (AAuM) 99,074.59 41,613.68 26,562.67 58,821.34
3. Gross income as % of %38.8%11.8%52.81-%63.21MuAA
4. Expense Ratio:
%63.0%32.0%69.1%40.2)esiw nalp( MuAA fo % sa esnepxE latoT.ab. Management Fee as % of AAuM %81.0%90.0%19.0%20.1)esiw nalp(
5. Net Income as a percentage %74.8%88.7%12.02-%23.01MuAA fo
6. Portfolio turnover 20.3oitar 0.75 - -
7. Total Dividend per unit distributedduring the year / period (plan wise)
Daily Dividend Reinvestment Option-Individual / HUF 1.000 - 0.31356428 0.37495335Daily Dividend Reinvestment Option-Others 1.000 - 0.31356428 0.34897780
8. Returns:
a. Last One YearANANANANnoitpO/nalP htworG
ANANkramhcneB
b. Since Inception%51.9noitpO/nalP htworG -27.37% 4.18% 4.46%
%65.3%65.3%97.92-%37.11kramhcneB
49
His torical Per Unit Statistics for the period ended March 31, 2008
LIST OF COLLECT ION CENTRES
JPMorgan Asset Management India Priva te Limited
Ahm edabad : 302, Megha House, Near Law Garden, Mithakhali Six Road, Navrangpura, Ahmedabad - 380 006.
Bengaluru : 501, 5th Floor, Prestige Centre Point, 7, Cunningham Road, Bengaluru - 560 052.
Chennai : TV Loganathan Towers, II Floor, No. 95 V M Street, R K Salai, Mylapore, Chennai - 600 004.
Kolkata : Block B, 5th Floor, 22 Camac Street, Kolkata - 700 016.
Mumb ai : Kalpataru Synergy, 3rd Floor, West Wing, Santacruz (East), Mumbai - 400 055.
Delhi : Shangri-la Hotel, Business Suite - 507, 19, Ashoka Road, Connaught Place, New Delhi - 110 001.
Pune : Office No. 301, Nandadeep, Above Odyssey Shop, F C Rd, Shivajinagar, Pune - 411 005.
Deutsche Investor Services Private Limited
Investor Service Centres: The Registrar will be the official point of acceptance for electronic transactions received from specified banks, financialinstitutions, distribution channels, etc. (mobilised on behalf of their clients) with whom the AMC has entered / may enter into specific arrangements forpurchase / sale / switch of Units
Agra : Unit No.13/A, 1st Floor, Kailash Tower, Block No.E 16/8, Sanjay Place, Agra - 282 002. Ahmedabad : M-Square Building, First Floor, SwastikChar Rasta, B/H City Centre, Opp Om Complex, Off CG Road, Ahmedabad - 380 009 Gujarat. Ajmer : No.25, K.C Complex, opposite Subhash Udhyan,Ajmer - 305 001. Amaravati : Shop No.5, 1st Floor, Gulshan Towers, Jaistamb Chowk, Near Pancsheel Theatre, Amravati - 444 601 Amr itsar : FrontPortion, 2nd Floor, 77, Railway Link Road, Amritsar - 143 001. Aur angabad : Alaknanda Complex, Shop no-4, Adalat Rd, Near Baba Petrol Pump,Aurangabad - 431 005. Bangalore : 104, 1st Floor, Prestige Meredian 1 M G Road, Bangalore - 560 001, Karnataka. Bareilly : 320, Akash Floors, CityStation Road, Civil Line, Bareilly - 243 001. Belgaum : Sri Sukh Sagar Shopping Complex, Ground Floor, CTS# 10618/1/2/3, Nehru Nagar, Belgaum -590 010. Bhavnagar : Sterling Point , 2nd floor (220-221), Waghawadi Road, Bhavnagar - 364 002. Bhillai : Shyam Shakuntala Complex, 209, GroundFloor, 2/4, Nehru Parisar, Near Nehru Nagar Rail Crossing, Bhillai - 490 022. Bhop al : Vijay Stambh BG-17, Ground Floor, MP nagar Opp UTI, Bhopal,MP - 462 011. Bhub aneswar : Metro House, Shop No.5, A 410, Vanivihar, Bhubaneshwar - 751 004, Orissa. Calic ut : C 14, C15, 2nd Floor, Sky TowerShopping Mall, Municipal Corporation Door No 5/3283, Situated at Bank Road Junction, Kozhikode, Calicut - 673 001. Chand igarh : SCO 154-155,Sector 17 C, 2nd Floor, Deepak Towers, Chandigarh, (U.T) - 160 017. Chennai : Pasla Foreign Exchange Bldg., Next to Tata Motors, 1st Floor, DoorNo.141, Anna Salai, Chennai - 600 002, Tamil Nadu. Cochin : 3rd Floor, Block B, BAB Towers, Atlantis, M G Road, Ernakulam, Kochi - 682 015, Kerala.Coimbator e : No.424-E, 2nd Floor, Red Rose Towers, D B Road, R S Puram, Coimbatore - 641 002, Tamil Nadu. Cuttack : 1st Floor, Brajraj Bhawan,Link Road, Opposite New LIC Colony, Cuttack - 753012, Orissa. Dehradun : Shop No.25, Ground Floor, Radha Palace Shopping Complex, 78 RajpurRoad, Dehradun - 248001, Uttarakhand. Durg apur : 3 rd Floor, City Plaza-II, City Residency, Burdwan, Durgapur - 713 216. Erod e : No.859, N.S.T.V.Building, 1st Floor, Opp Shivranjani Hotel, Brough Road, Erode - 638 001. Goa : Afran Plaza, 1st Floor, Shop No.F1&F2, Near Don Bosco High School,M.G Road, Panjim, Goa - 403 001. Gorakhpur : Room No 12, First Floor, Mangalam Tower, 13 A, Civil Lines, Golghar, Gorakhpur - 273 001.Guntur : 2nd Floor, Aditya Complex, 6-19-35, 13th Main Road, Arundalpet, Guntur - 522 002, Andhra Pradesh. Gurg aon : Ground Floor, Vatika Artium,Block-B, Sector-53, Gurgaon, Haryana -122 002. Guwahati : Ganapati Enclave, Opposite Bora Service Station, G S Road, Ulubari, Guwahati - 781 007.Gwali or : Ganapati Plaza, 1st Floor, City Centre, Gwalior - 474 011. Hubli : Shop No G-2 , Revankar Comfort, Door No 450/1A, Deshpande Nagar,Hubli - 580 030 Hyderabad : 6-3-1093/UG-3 (A & B), Vintage Boulevard, Raj Bhavan Road, Somajiguda, Hydrebad - 500 082 Indor e : B3, Aru Plaza,582 M.G Road, Opp Hukumchand Ghantaghar, Indore, M.P - 452 001. Jabalpur : Mezzanine Floor, Chandrika Towers, 55, Model Road, Near ShastriBridge, Napier Town, Jabalpur - 482 002, Madhya Pradesh. Jaipur : No.605, Plot No.0-15, Ashok Marg, C-Scheme, Green House, Jaipur - 302 001.Jalla ndh ar : Rachna Towers, 1st Floor, GT Road, Jalandhar - 144 003. Jamnagar : 106, Madhav Complex, P. N. Marg, Opp. D.K.V. College, Jamnagar- 361 004. Jamshedpur : Bharat Business Center, Ground Floor, Ram Mandir Area, Beside Mithiala Motors, Bistupur, Jamshedpur - 831 001, Bihar.Jodhpur : Office No 209, 2nd Floor, Aadeshwar Tower, Chopasni Road, Jodhpur -342 001. Kanpur : Office No.216 & 217, 2nd Floor, Kan Chambers,14/113, Civil Lines, Kanpur - 208 001, Uttar Pradesh. Kolhapur : Shop No.84, Gemstone Rao Bahadur Vichare Complex, 517/2, New Shahupuri, Near ST Stand, Kolhapur - 416 001, Maharashtra. Kolka ta : Lords Building, 7/1, Lord Sinha Road, Block No.GF/D, Ground Floor, Kolkata - 700 071.Lucknow : Sky Hi Chambers, F-1, 1st Floor, Park Road, Lucknow - 226 001, Uttar Pradesh. Ludh iana : Fortune Chambers, S.C.O, 16-17, 4th Floor,Feroze Gandhi Market, Opp Ludhiana Stock Exchange, Ludhiana - 141 001. Madur ai : Plot No 10, Vishnu Plaza, Near P T R Bridge, Shop No 16, GrFloor Reliance Money, Vaigai Colony, 80ft Road, Annanna Nagar, Madurai - 625 020. Mangalore : “Manasa” Towers , 2nd Floor, Kodialbail, M.G Road,Mangalore, Karnataka - 575 003. Moradabad : Shop No 7, Sai Sadan Complex, Ground Floor, Jail Road, Moradabad - 244 001. Mumb ai : ProspectChambers, G 02 B, D N Road, Fort, Mumbai - 400 001, Maharashtra. Mysore : Shop No7, Cellar, Mythri Arcade,Saraswathipuram, Mysore, Karnataka -570 009. Nagpur : Shop No.10, Prathiba Sankul, North Ambazari Road, Nagpur, Maharashtra - 440 010. Nasik : Suyojit Chambers, Ground Floor, G-2,Trimbak Naka, Near CBS, Nasik - 422 002. Nellore : Shop No.1, Ravula Arcade Shopping Complex, GNT Road, Nellore - 524 001. New Delhi : 910/911 A, 9th Floor, Narain Manzil, Barakhamba Road, New Delhi - 110 001. Panipat : N K Towers, 2nd Floor, Near IB College, G.T Road, Panipat,-Hariyana - 132 103. Patiala : 2nd floor, 29, New Leela Bhawan, Patiala -147 001. Patna : Hari Niwas, Shop No.209, 2nd Floor, Dak Bungalow Road,Patna - 800 001. Pune : Shop No.7, Ground Floor, Jalan Corner CTS No.538 & 539, Narayan Peth, N C Kelkar Marg, Pune - 411 030, MaharashtraRajamundr y : 36-7-8, 1st Floor, SBI Complex, Stadium Road, Innespet, Rajamundry, Andhra Pradesh - 533 101. Rajkot : L-1, Puja CommercialComplex, Harihar Chowk, Near GPO, Panchnath Plot, Rajkot - 360 001. Ranchi : Shop No22, AC Market, G.E.L. Church Complex, Main Road, Ranchi -834 001. Rour kela : Triveni Complex, 2nd Floor, Madhusudan Marg, Opp, Hotel Sukh Sagar, Rourkela - 769 001. Salem : VII A, 2nd Floor, DivyaTowers, Fort, Main Road, Shevapet, Salem - 636 001. Sambalpur : Quality Mansion, Ground Floor, Main Road, Nayapara, Gole Bazar, Sambalpur - 768001, Orissa. Silli gur i : Gitanjali Complex, Co-operation Bank, 2nd Floor, Sevoke Road, Opp PCM Tower, Siliguri - 734 001. Surat : Shop No.G12,Ground Floor, Jolly Plaza, Opp Atwagate Police Station, Atwagate, Surat - 395 001, Gujarat. Trichy : Aravindh Plaza, 1st Floor , NO-2, Fort StationRoad, Trichy - 620 002. Trivandrum : 2nd Floor, Annas Arcade, Tc 26/15(80),Opp AG’s Office, Spencer Junction, M G Road, Trivandrum - 695 001.Udaipur : Daulat Chambers, 406, 3rd Floor, 4-D, Sardarpura, Udaipur, Rajasthan - 313 001. Vadod ara : No.301, Gokulesh 2, R C Dutt Road, Alkapuri,Vadodara - 390 005, Gujarat. Valsad : 303 K.B.Mall, Hallar Road, Old Vasant Talkies, Valsad - 396 001. Varanasi : Kuber Chambers, 3rd Floor, Unit 16,Rath Yatra Crossing, Varanasi.- 221 010. Vijaya wada : Door No. 39-1-80, Saptagiri Complex, 1st Floor, M G Road, Labbipet, Vijayawada - 520 010.Vizag : Shop No.2, Ground Floor, Redname Regency, Dwarka Nagar, Vizag - 530 001, Andhra Pradesh. Warangal : Shop No. C-40, 1st Floor, GreenSquare, Opposite Public Garden, Hanamkonda, Warrangal, Andhra Pradesh - 506 001.
The above list is subject to change from time to time. The investors are advised to contract the Investor Service Centre / Office of the AMC for exactlocation and contact numbers of the Collecting Bankers / AMC offices / ISCs.