Global Managers Investment Company ICVC

www.standardlifeinvestments.com

GGlloobbaall MMaannaaggeerrss IInnvveessttmmeenntt CCoommppaannyy IICCVVCC

IInntteerriimm RReeppoorrtt && FFiinnaanncciiaall SSttaatteemmeennttss

for the 6 months ended 30 September 2008 (Unaudited)

1 Company Information*

3 Background to the Company*

4 Authorised Corporate Director’s (ACD’s) Report*

4 Statement of Authorised Corporate Director’s (ACD’s) Responsibilities

5 Investment Market Overview

6 Financial Instruments Disclosure

7 Aggregated Financial Statements

8 Accounting Policies

9 Notes to the Aggregated Financial Statements

IInnvveessttmmeenntt RReevviieeww** aanndd FFiinnaanncciiaall SSttaatteemmeennttss

12 European Equity Manager of Managers Fund

25 Japanese Equity Manager of Managers Fund

37 North American Equity Manager of Managers Fund

50 Pacific Basin Equity Manager of Managers Fund

63 UK Bond Manager of Managers Fund

77 UK Equity Manager of Managers Fund

*Collectively, these items comprise the Authorised Corporate Directors’ Report for the purposes of the rulescontained in the Collective investment Schemes sourcebook (“the Regulations”).

CCoonntteennttss

1Global Managers Investment Company ICVCInterim Report and Financial Statements for the 6 months ended 30 September 2008

CCoommppaannyy IInnffoorrmmaattiioonn

TThhee CCoommppaannyyGlobal Managers Investment Company

HHeeaadd OOffffiiccee1 George StreetEdinburghEH2 2LL

AAuutthhoorriisseedd CCoorrppoorraattee DDiirreeccttoorr ((AACCDD))Standard Life Investments (Mutual Funds) Limited(Authorised & Regulated by the Financial Services Authority)

RReeggiisstteerreedd OOffffiiccee1 George StreetEdinburghEH2 2LL

BBooaarrdd ooff DDiirreeccttoorrss ooff tthhee AACCDDChairman – N.K. Skeoch, BA (Hons), MA, FSI Chief Executive – M. Connolly, MBADirector – J. Kerr Director – W.R. Littleboy, BA (Hons), MA Director - A.S. Acheson Director - H.S. Nimmo

SSeeccrreettaarryyV.J. O’Brien, ACII

RReeggiissttrraarrThe Bank of New York Mellon (International) LimitedOne Canada SquareLondonE14 5AL(Authorised & Regulated by the Financial Services Authority)

RReeggiisstteerr ooff SShhaarreehhoollddeerrssThe register of shareholders for each of the sub-funds of the Company iskept and can be inspected free of charge at:12 Blenheim PlaceEdinburghEH7 5JH

CCuussttooddiiaannBank of New York Trust & Depositary Company LimitedOne Canada SquareLondonE14 5AL(Authorised & Regulated by the Financial Services Authority)

DDeeppoossiittaarryyJ.P.Morgan Trustee and Depositary Company Ltd

RReeggiisstteerreedd OOffffiiccee125 London WallLondonEC2Y 5AJ

HHeeaadd OOffffiicceeChaseside Bournemouth BH7 7DA (Authorised & Regulated by the Financial Services Authority)

PPrriinncciippaall ppllaaccee ooff bbuussiinneessss iinn tthhee UUnniitteedd KKiinnggddoommChaseside Bournemouth BH7 7DA (Authorised & Regulated by the Financial Services Authority)

IInnddeeppeennddeenntt AAuuddiittoorrssPricewaterhouseCoopers LLPChartered Accountants and Registered AuditorsErskine House68-73 Queen StreetEdinburgh EH2 4NH

Global Managers Investment Company ICVCInterim Report and Financial Statements for the 6 months ended 30 September 2008

2

CCoommppaannyy IInnffoorrmmaattiioonn ((ccoonnttiinnuueedd))

IInnvveessttmmeenntt AAddvviisseerrRReegguullaatteedd bbyy tthhee SSeeccuurriittiieess aanndd EExxcchhaannggee CCoommmmiissssiioonn ((SSEECC))Wilshire Associates Inc1299 Ocean AvenueSuite 700Santa MonicaCalifornia 90401USA

IInnvveessttmmeenntt SSuubb--AAddvviisseerrssRReegguullaatteedd bbyy tthhee SSeeccuurriittiieess aanndd EExxcchhaannggee CCoommmmiissssiioonn ((SSEECC))Acadian Asset Management IncTen Post Office SquareBostonMA 02109USA

Clay Finlay Inc200 Park Avenue56th FloorNew YorkNY 10166USA

Delaware Investment Advisors, a series of Delaware Management Business Trust2005 Market StreetPhiladelphia, PA 19103United States

Hotchkis and Wiley Capital Management, LLC725 S. Figueroa 39th FloorLos AngelesCA 90017USA

Principal Global Investors 11100 Wayzata BoulevardSuite 161MinnetonkaMN 55305-5530USA

Victory Capital Management® (management agreement signed on 14 December 2007)127 Public SquareClevelandOH 44114

Systematic Financial Management LP (management agreement signed on14 December 2007)300 Frank W. Burr BoulevardGlenpointe East7th FloorTeanacNJ 07666

McKinley Capital Management, Inc. (management agreement signed on10 June 2008)3301 C StreetSuite 500 AnchorageAK 99503

Daiwa SB Investments USA Ltd (Management agreement signed on 26 August 2008)32 Old Slip11th FloorNew York, NY 10005-3504

IInnvveessttmmeenntt SSuubb--AAddvviisseerrssRReegguullaatteedd bbyy tthhee FFiinnaanncciiaall SSeerrvviicceess AAuutthhoorriittyy ((FFSSAA))Royal London Asset Management Limited55 Gracechurch StreetLondonEC3V OUF

Rogge Global PartnersSion Hall56 Victoria EmbankmentLondonEC4Y 0DZ

New Star Institutional Managers Limited1 Knightsbridge GreenLondonSW1X 7NEUnited Kingdom

Pyrford International plc79 Grosvenor StreetLondonW1K 3JUUnited Kingdom

Baillie Gifford Overseas LimitedCalton Square1 Greenside RowEdinburghEH1 3ANUnited Kingdom

Alliance Capital Limited1st Floor50 Berkeley StreetLondonW1J 8HAUnited Kingdom

Mondrian Investment Partners Limited80 Cheapside Third FloorLondonEC2V 6EE

Newton Investment Management Limited71 Queen Victoria StreetLondonEC4V 4DRUnited Kingdom

UBS Global Asset Management Limited21 Lombard StreetLondonEC3V 9AHUnited Kingdom


Global Managers Investment Company ICVC ("the Company") is an open-ended investment company with variable capital. The Company has itshead office in Scotland with registered number IC000295 and is currently authorised pursuant to Regulation 14 of the Open-Ended InvestmentCompanies Regulations 2001 ("the OEIC Regulations"). The effective date of the authorisation order made by the FSA was 13 February 2004.

The Company is constituted as a "UCITS scheme which complies with CIS Chapter 5" for the purpose of the FSA Rules. It has an umbrella structureand currently consists of six sub-funds ("Funds") as follows:

European Equity Manager of Managers Fund

Japanese Equity Manager of Managers Fund

North American Equity Manager of Managers Fund

Pacific Basin Equity Manager of Managers Fund

UK Bond Manager of Managers Fund

UK Equity Manager of Managers Fund

The base currency of the Company is sterling. The minimum share capital of the Company is £1.00 and the maximum share capital is £50 billion.

Holders of shares in the Company are not liable for the debts of the Company.

OOtthheerr RReelleevvaanntt IInnffoorrmmaattiioonnA full copy of the Prospectus is available on request at the registered office of the Company.

RReeppoorrttiinngg XXDD aanndd PPaayymmeenntt DDaatteess ((AAllll FFuunnddss))

IInntteerriimm 30 SeptemberAAnnnnuuaall 31 March

XXDD ddaatteess

Interim 30 September Annual 31 March

PPaayymmeenntt ddaatteess

Interim 30 NovemberAnnual 31 July

BBaacckkggrroouunndd ttoo tthhee CCoommppaannyy


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SSttaatteemmeenntt ooff AAuutthhoorriisseedd CCoorrppoorraattee DDiirreeccttoorr’’ss RReessppoonnssiibbiilliittiieess

The Authorised Corporate Director (ACD) is Standard Life Investments (Mutual Funds) Limited which is the sole director, authorised and regulatedby the Financial Services Authority, for investment business.

Global Managers Investment Company ICVC is an Open-Ended Investment Company with variable capital under Regulation 14 (Authorisation) ofthe Open-Ended Investment Companies Regulations 2001 and the shareholders are not liable for the debts of the Company.

Global Managers Investment Company ICVC is structured as an umbrella company. Each Fund is invested as if it were a “UCITS scheme” typespecified in the FSA Rules.

Distributions are made from positive net income where gross income exceeds expenses and tax. The total return consists of investment andcurrency gains and losses in addition to net income. In situations where Funds have a negative total return but a positive net income position, therewill be a distribution.

Names and addresses of the ACD, Registrar and Auditors are contained on page 1 of the Report and Accounts. The names and addresses of theInvestment Advisers are detailed on page 2. The investment objectives and policy of each Fund, how they were achieved and investment activitiesduring the period are disclosed within the indvidual Funds’ reports.

The Funds are not legal entities. If the assets attributable to any Fund were insufficient to meet liabilities attributable to it, the shortfall might haveto be met out of the assets attributable to one or more of the other Funds of Global Managers Investment Company ICVC.

In the future, the Company may launch other Funds.

I hereby certify the Report and Accounts for the period ended 30 September 2008 on behalf of the Directors of Standard Life Investments (MutualFunds) Limited.

WWiilllliiaamm LLiittttlleebbooyyDDiirreeccttoorrSSttaannddaarrdd LLiiffee IInnvveessttmmeennttss ((MMuuttuuaall FFuunnddss)) LLttdd

2288 NNoovveemmbbeerr 22000088

The Open-Ended Investment Companies Regulations 2001 and the rules contained in the Collective Investment Schemes sourcebook require theACD to prepare accounts for each annual and half-yearly accounting period which give a true and fair view of the financial position of theCompany and of its net income/expenses and net gains/losses on the property of the Company for the period and to lay copies of the annualreport before the Company in general meeting.

In preparing the financial statements the ACD is required to:• select suitable accounting policies then apply them consistently;

• comply with the disclosure requirements of the Statement of Recommended Practice for the Financial Statements of Authorised Fundsissued by the Investment Management Association in December 2005 as set out in the accounting policies on page 10;

• follow generally accepted accounting principles and applicable accounting standards;

• make judgements and estimates which are reasonable and prudent;

• keep proper accounting records, which enable it to demonstrate that the accounts, as prepared, comply with the above requirements; and

• prepare the financial statements on the going concern basis unless it is inappropriate to presume that the scheme will continue inoperation.

The ACD is responsible for the management of the Company in accordance with the Instrument of Incorporation, Prospectus and the Regulationsand for taking reasonable steps for the prevention and detection of fraud and other irregularities.The ACD confirms that suitable accounting policies have been used and applied consistently, and reasonable and prudent judgements andestimates have been made in the preparation of the financial statements for the period ended 30 September 2008. The ACD also confirms thatapplicable accounting standards have been followed and that the financial statements have been prepared on a going concern basis.

AAuutthhoorriisseedd CCoorrppoorraattee DDiirreeccttoorr’’ss ((AACCDD’’ss)) RReeppoorrtt


IInnvveessttmmeenntt BBaacckkggrroouunndd Volatility reigned across all major markets during the period, as funding worries within the financial sector dominated investor sentiment. Althoughinflationary pressures abated, the recessionary fears gained credence amid a raft of soft economic data.

The UK stock market was driven lower over the period by the twin themes of the banking crisis and lower commodity prices. Events in the USbanking sector heightened investors fears, and severe falls in the shares of HBOS forced it into a rescue deal with Lloyds TSB. Meanwhile,deteriorating confidence in the global economy saw some commodity prices, including oil and metals, rapidly drop from their highs.

The period was marked by pronounced volatility in US equities, as concerns over the ongoing liquidity crunch and fears of a recession intensified.Despite rebounding modestly in August, the US found itself in the eye of the financial storm in September, when problems in the banking sectorclaimed high profile casualties including Lehman Brothers and AIG. In addition, Washington Mutual received the unenvied accolade of becomingthe largest ever US banking failure. A Treasury-led bailout package aimed to provide much-needed liquidity for banks’ balance sheets. However, theeconomy remained weak, with the housing market, factory orders and employment figures all disappointing investors late in the period.

European equities experienced the same instability as other world markets over the period. However, the European Central Bank persistently choseto keep a closer eye on the inflation picture rather than slowing growth, with rising food and energy prices, prompting the ECB to keep interestrates higher. Despite a modest rally in August, European markets fell sharply in September, as the global financial crisis reached mainland Europe.

Having previously benefited from its limited exposure to western financial markets, the Japanese market could not help but succumb to widespreadnegative momentum during the period. Deepening US economic gloom had serious repercussions for Japan, given its heavy reliance on foreigndemand. Markets also reacted violently to the uncertainty surrounding congressional approval of the US Treasury rescue package, which thegovernment hoped would bring some stability to the global financial system.

In China, shares turned weak as investors worried about the impact of monetary tightening measures on the economy. Towards the end of theperiod, this appeared to be taking effect and Chinese manufacturing output declined in August. Latterly, the Australian equity market suffered fromits exposure to falling resources prices, while its financial sector was also more exposed to the global financial crisis than other Asian economies.

Market volatility also extended to bond markets. The bailout of investment bank Bear Stearns in mid-March by the US Federal Reserve Bank wasviewed as a turning point, sparking a rally in corporate bond markets that continued through April and May. High-yield bonds registered their bestmonthly returns for five years in April, reversing the flight to quality witnessed at the start of the year. However, from July onwards, governmentbonds once again benefited from their perceived safety as the global economic environment deteriorated further, and a stream of negative newsfrom the financial sector undermined corporate bond valuations. Index-linked bonds were among the strongest performing asset classes over theperiod, as global inflation expectations moved higher, driven by the ongoing commodity bull-run. However, index-linked bonds performed less welltowards the end of the period, when inflation expectations dropped due to falling commodity prices.

OOuuttllooookk ffoorr EEqquuiittiieess Markets remain subject to bouts of volatility and risk aversion given ongoing problems in financial markets and economic uncertainty. Volatility hasprovided some valuation opportunities but markets need a resolution to credit concerns and an improvement in the global economy in order for asustained rally.

Deteriorating domestic economic data, such as slowing business spending, rising unemployment, and ongoing housing sector problems, all pointto a significant and protracted squeeze on corporate profitability. Within the housing sector, the inventory overhang, foreclosures rate and limitedmortgage availability will continue to exert downward pressure on house prices for some time to come. Although valuations are attractive atcurrent levels, fuller details of the Troubled Asset Relief Program and an easing to liquidity constraints in the credit markets would bolster flaggingmarket confidence. More generally, the regulatory response will remain critical.

European economic newsflow has continued to deteriorate, from both central and peripheral economies across the region. Against the backdrop ofan increasingly volatile global economy and ongoing credit restrictions, European corporate profitability has remained subdued. Meanwhile,European exports have weakened as the economies of major trading partners decline. Corporate activity is likely to increase, with managementefforts still focused on restructuring and M&A opportunities. Central bank monetary policy is also likely to play a significant role.

The outlook in the UK remains uncertain, as the market continues to worry over the extent of the slowdown in the US. In the short-term,companies remain susceptible to bouts of volatility and risk aversion. Over the longer term, an easing of the credit crisis, a fall in inflation and signsof economic recovery will be key triggers for an upturn. Overall, the earnings outlook for the UK is set to slow, led down by financial and consumerareas of the market. However, the widespread sell-off has meant that fundamentally sound companies have fallen in value along with the widermarket, offering some compelling opportunities.

The Japanese economy remains highly dependent upon external demand, and as global growth slows, a moderate recession is expected. While USeconomic recovery is unlikely in the near term, other sources of demand for Japanese goods will provide support, particularly from global emergingmarkets. In the current environment, the balance sheet strength of Japanese companies remains solid compared to western peers, and providessome protection. Companies’ return on equity is historically high, as they work their asset bases harder to generate shareholder returns.

As oil and commodity prices trend lower, inflationary pressures across the region have begun to abate. Coupled with ongoing weakness indomestic economic data, central banks are poised to adopt a more neutral monetary stance. As recessionary concerns intensify, many companieshave a cautious outlook, although few have witnessed a dramatic deterioration in profitability. Earnings revisions remain subdued in light of aslowing global economy, however, Asian equity markets should gain support from a combination of relatively resilient domestic consumption,undervalued currencies, and strong corporate fundamentals.

OOuuttllooookk ffoorr BBoonnddssBond markets have benefited considerably from the sense of crisis across the globe, and have priced in significant rate cuts in all major economies.While the severity of recent events will encourage large rate cuts, we believe the frequency of failures within the financial sector is unsustainable.When some calm begins to descend on the sector, the eventual cost of government actions will need to be assessed by bond markets. This willinevitably increase the level of supply issued into the market, and could be a drag on bond prices. Nevertheless, the protracted nature of thecurrent economic downturn should encourage greater investment in the safety of government bonds.

CCaauuttiioonnaarryy NNootteeIt should be remembered that past performance is not a guide to future performance. The value of investments may go down as well as up and,therefore, investors may not get back the amount originally invested.

IInnvveessttmmeenntt MMaarrkkeett OOvveerrvviieeww


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FFiinnaanncciiaall IInnssttrruummeennttss In accordance with the investment objectives, the Funds may hold certain financial instruments. These comprise:

• securities held in accordance with the investment objective and policies;

• cash and short-term debtors and creditors arising directly from operations; and

• derivatives.

The main risks that each Fund may be affected by are market price, foreign currency, interest rate, liquidity and credit risk. The ACD's policies formanaging these risks are summarised below and have been applied consistently throughout the period, and prior period and across the appropriateFunds.

MMaarrkkeett pprriiccee rriisskk Each Fund's investment portfolio is exposed to market price fluctuations which are monitored by the Investment Manager in pursuance of theinvestment objectives and policies. Adherence to investment guidelines and to investment and borrowing powers mitigates the risk of excessiveexposure to any particular type of security or issuer.

In the current market conditions certain securities have become difficult to price. For those securities, reliance has therefore been placed on singlebroker prices. This has not resulted in any adjustments to the financial statements.

FFoorreeiiggnn ccuurrrreennccyy rriisskk An element of the investment portfolio and cash on deposit in some of the Funds may be invested in overseas securities and the balance sheet canbe affected by movements in foreign exchange rates. In certain circumstances where this is significant, the Investment Manager may seek tomanage exposure to currency movements by using forward currency contracts. Included within the notes to the accounts of individual Funds aredetails of any foreign currency exposures.

IInntteerreesstt rraattee rriisskk Interest receivable on bank deposits or payable on bank overdrafts and interest receivable or payable on interest rate swaps will be affected byfluctuations in interest rates. The Investment Manager continuously reviews interest rates and inflation expectations. The assessment of this mayresult in a change in investment strategy.

Bond yields are affected by market and economic conditions, including inflation rates and government policy. An analysis of the interest rates andmaturity of bond listings is detailed in the notes to the financial statements of the Funds as appropriate.

In addition, changes to prevailing rates or changes in expectations of future rates may result in an increase or decrease in the value of the securitiesheld. In general, if interest rates rise, the income potential of the Funds also rises but the value of fixed rate securities will decline (along withcertain expenses calculated by reference to the assets of the Funds). A decline in interest rates will in general have the opposite effect.

LLiiqquuiiddiittyy rriisskk Each Fund's assets comprise mainly readily realisable securities. The main liabilities of each Fund are the redemption of any shares that investorswish to sell and the settlement of stock purchases. The Investment Manager reviews the cash and liability position continuously and should anincrease in liquidity be required, the Investment Manager will sell securities.

CCrreeddiitt rriisskk All cash exposures are carefully managed to ensure that money is placed on deposit with counterparties that meet the minimum credit ratingdeemed appropriate for this business. Some Funds deliberately invest in securities (e.g. corporate bonds) with a well defined and published creditrating. These Funds are deliberately taking credit risk in order to seek additional rewards.

FFaaiirr vvaalluuee ooff ffiinnaanncciiaall aasssseettss aanndd lliiaabbiilliittiieess Securities held by the Fund are valued at bid-market value. There is no significant difference between market value and fair value. Unquotedinvestments are valued based on the ACD's opinion of fair value, the intention of which is to estimate market value.

Other financial assets and liabilities of the Fund are included in the balance sheet at the ACD’s opinion of fair value.

FFiinnaanncciiaall IInnssttrruummeennttss DDiisscclloossuurree


ffoorr tthhee ppeerriioodd eennddeedd 3300 SSeepptteemmbbeerr 22000088

3300 SSeepptteemmbbeerr 22000088 3300 SSeepptteemmbbeerr 22000077

NNootteess ££''000000 ££''000000 ££''000000 ££''000000

Net (losses)/gains on investments during the period 1 (68,070) 3,283

Currency losses (82) (197)

Income 2 9,728 8,492

Expenses 3 (500) (372)

Finance costs: Interest 5 (13) (22)

Net income before taxation 9,215 8,098

Taxation 4 (891) (670)

NNeett iinnccoommee aafftteerr ttaaxxaattiioonn 8,324 7,428

Total return before distributions (59,828) 10,514

Finance Costs : Distributions 5 (8,411) (7,479)

CChhaannggee iinn nneett aasssseettss aattttrriibbuuttaabbllee ttoo sshhaarreehhoollddeerrss (68,239) 3,035



££''000000 ££''000000 ££''000000 ££''000000

NNeett aasssseettss aatt tthhee ssttaarrtt ooff tthhee ppeerriioodd 439,089 456,474

Movement due to sales and repurchases of shares :

Amounts receivable for creation of shares 12,144 231,913

Less: Amounts payable on cancellation of shares (9,501) (203,694)

2,643 28,219

Dilution levy 53 73

Stamp duty reserve tax (8) 0

Change in net assets attributable to shareholders (68,239) 3,035

Retained distribution on accumulation shares 8,070 5,413

Amounts paid by fund manager 5 0

NNeett aasssseettss aatt tthhee eenndd ooff tthhee ppeerriioodd 381,613 493,214

The above statement shows the comparative closing net assets at 30 September 2007 whereas the current period commenced 1 April 2008.

aass aatt 3300 SSeepptteemmbbeerr 22000088

3300 SSeepptteemmbbeerr 22000088 3311 MMaarrcchh 22000088**

NNootteess ££''000000 ££''000000 ££''000000 ££''000000

AAsssseettss

Portfolio of investments 372,128 426,846

Debtors 6 5,389 8,580

Cash and bank balances 11,745 8,072

Total other assets 17,134 16,652

Total assets 389,262 443,498

LLiiaabbiilliittiieess

Derivative liabilities 0 (342)

Creditors 7 (6,151) (4,066)

Bank overdrafts (1,498) (1)

Total other liabilities (7,649) (4,067)

Total liabilities (7,649) (4,409)

Net assets attributable to shareholders 381,613 439,089

*last audited figures

The figures above include the Global Bond Manager of Managers Fund which closed on 7 November 2007.

The notes on pages 9 to 11 form an integral part of these Financial Statements.

AAggggrreeggaatteedd SSttaatteemmeenntt ooff TToottaall RReettuurrnn

AAggggrreeggaatteedd SSttaatteemmeenntt ooff CChhaannggee iinn SShhaarreehhoollddeerrss’’ NNeett AAsssseettss

AAggggrreeggaatteedd BBaallaannccee SShheeeett

AAggggrreeggaatteedd FFiinnaanncciiaall SSttaatteemmeennttss ffoorr GGlloobbaall MMaannaaggeerrss IInnvveessttmmeenntt CCoommppaannyy IICCVVCC


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AAccccoouunnttiinngg PPoolliicciieess

((aa)) BBaassiiss ooff aaccccoouunnttiinnggThe Financial Statements have been prepared under the historical cost basis, as modified by the revaluation of investments and in accordancewith applicable accounting standards and the Statement of Recommended Practice for the Financial Statements of Authorised Funds issued bythe Investment Management Association (“IMA SORP”) in December 2005.

((bb)) RReeccooggnniittiioonn ooff IInnccoommeeI. Dividend income is recognised when the securities are first quoted on an ex-dividend basis.

II. Interest from fixed interest securities and short-term deposits is recognised on a daily accruals basis.

III. Underwriting income is recognised as part of the income property of the Funds unless it has been necessary to take up all or part of theshares underwritten in which case an appropriate proportion is deducted from the cost of those shares.

IV. Where stocks are received in lieu of cash dividends the value of that dividend is recognised in the gross income of the Funds. Whereenhanced scrip dividends are received the value of the enhancement is not recognised as income within the Funds. Any ordinary elementsof scrip dividends received is treated as income and will form part of the distribution.

V. Income on debt securities is recognised on the effective yield basis which takes account of the amortisation of any discounts or premiumsarising on the purchase price, compared to the final maturity value, over the remaining life of the security.

VI. Special dividends are treated as either income or capital depending on the nature of each individual case.

VII. Income is allocated to the share class of each fund according to the proportion of assets held within each share class.

((cc)) TTrreeaattmmeenntt ooff mmaannaaggeemmeenntt eexxppeennsseessAll expenses, except those relating to the purchase and sale of investments and Stamp Duty Reserve Tax, are charged against income.

((dd)) DDiissttrriibbuuttiioonn ppoolliiccyy

All of the net income available for distribution at the end of both the interim and final distribution periods will be distributed to shareholders.The Fund distributes on an effective yield basis. Any share class with a deficit of income will have the deficit made up from the income availablefor distribution in the remaining share classes.

((ee)) BBaassiiss ooff vvaalluuaattiioonn ooff iinnvveessttmmeennttssThe investments of the Funds have been valued at their bid price at 2pm on the last business day of the accounting period.

((ff)) EExxcchhaannggee rraatteessI. Assets and liabilities in foreign currencies are translated into Sterling at the exchange rates ruling on the last business day of the accounting

period.

II. Income in foreign currencies is translated into Sterling at the exchange rates ruling when the income is received.

((gg)) TTaaxxaattiioonnI. Tax is calculated using the marginal basis i.e. the tax effect of income and expenditure is allocated between capital and income on the

same basis as the particular item to which it relates.

II. Deferred tax is provided for on all timing differences that have originated but not reversed by the balance sheet date. Deferred tax is notrecognised on permanent differences. Deferred tax assets are only recognised where it is more likely than not that there will be suitabletaxable profits against which the future reversal of the underlying timing differences can be deducted.

III. Withholding tax on accrued overseas dividends is netted off against accrued income in the debtors note.

The tax charge relating to the movement in withholding tax on accrued overseas dividends is disclosed as current tax.

((hh)) DDiilluuttiioonn lleevvyy

The ACD's policy is to charge a dilution levy on large deals and, in accordance with the FSA Regulations, to pay this levy into the Fund. Thedilution levy imposed shall be an amount which shall not, in the opinion of the ACD, exceed the cost of dealing in the underlying securities.

((ii)) EEqquuaalliissaattiioonn

In order that each shareholder shall receive the same rate of distribution per share, the buying price of each share contains an amount calledequalisation. This is equivalent to the net distributable income less expenses accrued in the Fund at the time of purchase. As part of thedistribution payment the average equalisation is returned to Group 2 shareholders. The equalisation element of the distribution to Group 2shareholders is treated as a repayment of capital and is not liable to income tax. This amount should, however, be deducted from the cost ofthe shares for capital gains tax purposes.

((jj)) DDeerriivvaattiivveess

The Funds may enter into permitted transactions such as derivative contracts or forward foreign currency transactions. Where those transactionsare used to protect or enhance income, the income and expenses are included within net income in the Statement of Total Return. Where thetransactions are undertaken to protect or enhance investments, the gains or losses are treated as capital and included within gains/losses oninvestments in the Statement of Total Return.


NNootteess ttoo tthhee AAggggrreeggaatteedd FFiinnaanncciiaall SSttaatteemmeennttss ffoorr GGlloobbaall MMaannaaggeerrss IInnvveessttmmeenntt CCoommppaannyy IICCVVCC

11.. NNeett ((lloosssseess))//ggaaiinnss oonn iinnvveessttmmeennttss 3300 SSeepptteemmbbeerr 22000088 3300 SSeepptteemmbbeerr 22000077

££''000000 ££''000000

The net (losses)/gains on investments during the period comprise:

(Losses)/gains on forward currency contracts (32) 38

(Losses)/gains on non-derivative securities (68,038) 3,245

NNeett ((lloosssseess))//ggaaiinnss oonn iinnvveessttmmeennttss ffoorr tthhee ppeerriioodd (68,070) 3,283

22.. IInnccoommee 3300 SSeepptteemmbbeerr 22000088 3300 SSeepptteemmbbeerr 22000077

££''000000 ££''000000

Bank interest 172 224

Interest on debt securities 1,609 1,696

Overseas dividends 4,577 3,335

Stock dividends 100 67

Stock lending income 0 3

UK dividends 3,253 3,166

UK dividends on collective investment schemes (unfranked) 19 0

UK unfranked dividends (prior year) (2) 0

Underwriting commission 0 1

TToottaall iinnccoommee 9,728 8,492

33.. EExxppeennsseess 3300 SSeepptteemmbbeerr 22000088 3300 SSeepptteemmbbeerr 22000077

££''000000 ££''000000

PPaayyaabbllee ttoo tthhee AAuutthhoorriisseedd CCoorrppoorraattee DDiirreeccttoorr,, aassssoocciiaatteess ooff tthhee AAuutthhoorriisseedd CCoorrppoorraattee DDiirreeccttoorr aanndd aaggeennttss ooff eeiitthheerr ooff tthheemm::

ACD's periodic charge 172 208

Registration fees 122 8

294 216

PPaayyaabbllee ttoo tthhee DDeeppoossiittaarryy,, aassssoocciiaatteess ooff tthhee DDeeppoossiittaarryy aanndd aaggeennttss ooff eeiitthheerr ooff tthheemm::

Depositary's fees 52 57

Handling charges taken from the capital account (see note 5) 87 51

Safe custody fee 31 6

170 114

OOtthheerr eexxppeennsseess

Audit fee 36 42

36 42

TToottaall eexxppeennsseess 500 372

44.. TTaaxxaattiioonn 3300 SSeepptteemmbbeerr 22000088 3300 SSeepptteemmbbeerr 22000077

££''000000 ££''000000

((aa)) AAnnaallyyssiiss ooff ttaaxx cchhaarrggee ffoorr tthhee ppeerriioodd

Corporation tax at 20% 900 680

Double tax relief (528) (404)

Irrecoverable overseas tax 520 412

Overseas direct charge 11 7

CCuurrrreenntt ttaaxx cchhaarrggee ffoorr tthhee ppeerriioodd ((sseeee nnoottee 44((bb)))) 903 695

Deferred tax - origination and reversal of timing differences (see note 4 (c)) (12) (25)

TToottaall ttaaxx cchhaarrggee ffoorr tthhee ppeerriioodd 891 670


10

NNootteess ttoo tthhee AAggggrreeggaatteedd FFiinnaanncciiaall SSttaatteemmeennttss ffoorr GGlloobbaall MMaannaaggeerrss IInnvveessttmmeenntt CCoommppaannyy IICCVVCC ((ccoonnttiinnuueedd))44.. TTaaxxaattiioonn ((ccoonnttiinnuueedd)) 3300 SSeepptteemmbbeerr 22000088 3300 SSeepptteemmbbeerr 22000077

££''000000 ££''000000

((bb)) FFaaccttoorrss aaffffeeccttiinngg ccuurrrreenntt ttaaxx cchhaarrggee ffoorr tthhee ppeerriioodd

The tax assessed for the period is different from the standard rate of corporation tax in the UK for an open-ended investment company(20%). The differences are explained below:


Corporation tax @ 20% (2007: 20%) 1,842 1,620


Expense relief for overseas withholding tax 0 (1)

Expenses not deductible for tax purposes 17 10

Income taxable in different years 11 5


Movement in excess management expenses 10 0

Movement on DTR for deferred tax 1 0

Movement in income accruals not taxable 0 13

Precompte (1) 0

Prior period adjustment-unfranked dividends 2 0

Stock dividends not subject to corporation tax (20) (3)

Tax effect of interest distributions (311) (330)

Tax effect on expense relief (2) 0

Tax on special dividends in capital 1 0

UK dividends not subject to corporation tax (650) (634)

CCuurrrreenntt ttaaxx cchhaarrggee ffoorr tthhee ppeerriioodd ((sseeee nnoottee 44((aa)))) 903 695

Open Ended Investment Companies are exempt from tax on capital gains in the UK. Therefore, any capital return is not included in theabove reconciliation.

((cc)) AAnnaallyyssiiss ooff ddeeffeerrrreedd ttaaxxaattiioonn

Deferred tax provision at the start of the period 63 58

Deferred tax credit for the period (see note 5(a)) (12) (25)

DDeeffeerrrreedd ttaaxx pprroovviissiioonn aatt tthhee eenndd ooff tthhee ppeerriioodd 51 33

55.. FFiinnaannccee ccoossttss

The distributions take account of income received on the creation of shares and income deducted on the cancellation of shares andcomprise:


££''000000 ££''000000

Interim distribution 8,383 5,744

Income deducted on cancellation of shares 113 1,890

Income received on creation of shares (85) (155)

NNeett ddiissttrriibbuuttiioonnss ffoorr tthhee ppeerriioodd 8,411 7,479

Interest 13 22

TToottaall ffiinnaannccee ccoossttss 8,424 7,501

RReeccoonncciilliiaattiioonn ooff ddiissttrriibbuuttiioonnss::

Net income after taxation 8,324 7,428



66.. DDeebbttoorrss 3300 SSeepptteemmbbeerr 22000088 3311 MMaarrcchh 22000088

££''000000 ££''000000

Accrued income 1,899 2,781

Amounts receivable for creation of shares 110 0

Income tax recoverable 0 1

Overseas tax recoverable 241 152

Sales awaiting settlement 3,139 5,646

TToottaall ddeebbttoorrss 5,389 8,580


NNootteess ttoo tthhee AAggggrreeggaatteedd FFiinnaanncciiaall SSttaatteemmeennttss ffoorr GGlloobbaall MMaannaaggeerrss IInnvveessttmmeenntt CCoommppaannyy IICCVVCC ((ccoonnttiinnuueedd))77.. CCrreeddiittoorrss 3300 SSeepptteemmbbeerr 22000088 3311 MMaarrcchh 22000088

££''000000 ££''000000

Accrued ACD's periodic charge 87 238

Accrued audit fee 30 71

Accrued Depositary's fee 17 46

Accrued handling charges 21 26

Accrued registration fee 61 139

Accrued safe custody fee 5 17

Amounts payable for cancellation of shares 690 0

Bank interest payable 0 2

Corporation tax payable 593 292

Deferred taxation (see note 4(c)) 51 62

Income tax payable 635 323

Purchases awaiting settlement 3,961 2,850

TToottaall ccrreeddiittoorrss 6,151 4,066

88.. RReellaatteedd ppaarrttyy ttrraannssaaccttiioonnss

Standard Life Investments (Mutual Funds) Limited as Authorised Corporate Director (ACD) is a related party and acts as principal in respect ofall transactions of shares in the Company. The aggregate monies received through issue and paid on cancellation are disclosed in theStatement of Change in Shareholders' Net Assets. Any amounts due to or from Standard Life Investments (Mutual Funds) Limited at the endof the accounting period are disclosed in notes 6 and 7.

Amounts payable to Standard Life Investments (Mutual Funds) Limited, in respect of periodic charge and registration services are disclosed innote 3 and the amounts due at the period end are disclosed in note 7.

The transactions during the period with Standard Life Group companies and the percentage value of each sub-fund are included in the notesto the accounts of the individual funds.

99.. SShhaarree ccllaasssseess

The Fund currently has four share classes: Retail Accumulation, Institutional Accumulation, Standard Life Accumulation and PensionAccumulation.

The net asset value of each share class, the net asset value per share and the number of shares in each class are given in the comparativetables within each fund. All four classes have the same rights on winding up.

The ACD's periodic charge for each share class for each fund is disclosed within the notes for each individual fund.

1100.. DDeerriivvaattiivveess aanndd ootthheerr ffiinnaanncciiaall iinnssttrruummeennttss

The numerical disclosures required under FRS13 are included in the notes to the accounts of the individual funds where applicable.


12

EEuurrooppeeaann EEqquuiittyy MMaannaaggeerr ooff MMaannaaggeerrss FFuunndd

IInnvveessttmmeenntt RReeppoorrtt

IInnvveessttmmeenntt OObbjjeeccttiivveeThe investment objective of the Fund is to provide capital appreciation. It is intended that incomewill not be a prime consideration.

IInnvveessttmmeenntt PPoolliiccyyThe investment policy of the Fund is to invest primarily in equities and equity type investments ofcompanies incorporated in Europe or which in the opinion of the Investment Adviser (or sub-adviser), carry on a substantial part of their operations in Europe (excluding the UK). "Equity typeinvestments" will include convertible stocks, stock exchange listed warrants, depositary receipts andany other such investments which entitle the holder to subscribe for or convert into the equity of thecompany and/or where the share price performance is, in the opinion of the Investment Adviser (or sub-adviser), influenced significantly by stockmarket performance of the company's ordinary shares. The Fund may also invest in deposits, money market instruments and collective investmentschemes.

RRiisskkUp to 100% of the scheme property of this Fund may be invested in warrants. If more than 5% of the scheme property is invested in warrants thenet asset value may at times be highly volatile.

EEnnvviirroonnmmeennttEuropean markets made solid initial gains in the early part of the period, before capitulating to end the second quarter of 2008 in negative territory.The financial sector struggled to make headway amid concerns over the outlook for wholesale funding and the need for banks to reduce debtlevels. Rising Euro-zone inflation led the European Central Bank to signal that it may be forced to raise interest rates from 4% in response.

European equities suffered further losses over the second half of the period, despite making modest gains throughout July and August. Negativenewsflow from the global financial sector continued to dominate market movements, against a backdrop of deteriorating economic growth andrising inflationary pressures. Although a fall in commodity prices provided some support, the dramatic events within the US and European financialsectors in September saw markets end the period in sharply negative territory.

AAccttiivviittyyIn the first three months of the period, the Fund’s managers purchased Carlsberg, as its acquisition of Russian brewer BBH provided the firm withsome excellent growth opportunities. The likely negative effect of the high oil price on the airline industry prompted the sale of Air France-KLM,while profits were taken in StatoilHydro, following a strong run of outperformance.

Later in the period, a position was initiated in ArcelorMittal, a leading producer and distributor of steel products, on the back of strong earningsand growth prospects. Among the major sales were Swatch, which was reduced following concerns over the growth prospects of the company,and SGL Carbon Group, in order to decrease the Fund’s exposure to the industrials sector.

PPeerrffoorrmmaannccee The European Equity Manager of Managers Fund tracked the index into negative territory over the second quarter of 2008. Although there were nonotable detractors, selected stocks within the healthcare and financial sectors proved a drag on performance. However, the Fund benefited from itsoverweight exposure to the energy sector, which continued to strengthen on the back of rising commodity prices.

The second half of the period saw Fund performance undermined by weakness within the materials and industrial sectors. Energy stocks alsodented returns, as oil and commodity prices began to moderate. However, overweight exposure to the healthcare sector proved beneficial, as didlimited investments within the utilities sector.

OOuuttllooookkEuropean economic newsflow has continued to deteriorate, from both central and peripheral economies across the region.

Against the backdrop of an increasingly volatile global economy and ongoing credit restrictions, European corporate profitability has remainedsubdued.

Meanwhile, European exports have weakened as the economies of major trading partners decline.

We expect to see an increase in corporate activity, with management efforts still focused on restructuring and M&A opportunities.

Central bank monetary policy is also likely to play a significant role in future balance sheet strength.


IInnvveessttmmeenntt SSuubb--AAddvviisseerrss

AAccaaddiiaann AAsssseett MMaannaaggeemmeenntt

CCllaayy FFiinnllaayy IInncc

UUBBSS GGlloobbaall AAsssseett MMaannaaggeemmeenntt LLiimmiitteedd

LLaauunncchh DDaattee 20 February 2004

BBeenncchhmmaarrkk IMA Europe (Ex UK) Sector


SShhaarree ccllaassss AAccccoouunnttiinngg NNeett aasssseett vvaalluuee SShhaarreess iinn iissssuuee NNeett aasssseettppeerriioodd ooff sshhaarree ccllaassss vvaalluuee ppeerr sshhaarree

££''000000 ppRetail Accumulation 31 March 2006 1,680 1,089,721 154.17Retail Accumulation 31 March 2007 2,809 1,633,182 172.00Retail Accumulation 31 March 2008 2,564 1,534,199 167.12Retail Accumulation 30 September 2008 1,976 1,471,910 134.25

Institutional Accumulation 31 March 2006 367 234,014 156.76Institutional Accumulation 31 March 2007 412 234,014 176.06Institutional Accumulation 31 March 2008 395 230,293 171.52Institutional Accumulation 30 September 2008 278 201,101 138.24

Standard Life Accumulation 31 March 2006 68,578 43,055,231 159.28Standard Life Accumulation 31 March 2007 76,372 42,536,324 179.55Standard Life Accumulation 31 March 2008 31,016 17,373,426 178.53Standard Life Accumulation 30 September 2008 24,247 16,788,165 144.43

Pension Accumulation* 31 March 2008 54,767 112,410,353 48.72Pension Accumulation 30 September 2008 42,650 108,156,646 39.43

*From the commencement of the share class on 17 September 2007

SShhaarree ccllaassss CCaalleennddaarr DDiissttrriibbuuttiioonn HHiigghheesstt LLoowweessttyyeeaarr ppeerr sshhaarree pprriiccee pprriiccee

pp pp ppRetail Accumulation 2004** 0.4509 109.90 91.82Retail Accumulation 2005 1.0464 137.60 106.80Retail Accumulation 2006 0.9840 162.70 131.10Retail Accumulation 2007 1.5839 186.30 161.40Retail Accumulation 2008* 2.8230 182.90 134.33

Institutional Accumulation 2004** 1.0175 110.87 92.17Institutional Accumulation 2005 1.6751 131.50 108.10Institutional Accumulation 2006 1.5968 166.50 133.60Institutional Accumulation 2007 2.0787 191.50 165.30Institutional Accumulation 2008* 3.5436 188.40 138.55

Standard Life Accumulation 2004** 1.5967 111.86 92.33Standard Life Accumulation 2005 2.6658 142.40 109.40Standard Life Accumulation 2006 2.9722 171.00 136.50Standard Life Accumulation 2007 3.9708 198.40 169.90Standard Life Accumulation 2008* 5.1242 195.80 144.50

Pension Accumulation 2007*** 0.0200 54.15 49.72Pension Accumulation 2008* 1.4202 53.39 39.45

*To 30 September 2008**From the launch of the Fund on 20 February 2004 to 31 December 2004***From the commencement of the share class on 17 September 2007

TToottaall eexxppeennssee rraattiiooRReettaaiill IInnssttiittuuttiioonnaall SSttaannddaarrdd LLiiffee PPeennssiioonn

sshhaarree ccllaassss sshhaarree ccllaassss sshhaarree ccllaassss sshhaarree ccllaassssAs at 31 March 2007 1.92% 1.06% 0.06% n/aAs at 31 March 2008 1.91% 1.06% 0.05% 0.05%As at 30 September 2008 1.98% 1.13% 0.13% 0.08%

TER = ratio of total operating costs to average net assets


CCoommppaarraattiivvee TTaabblleess


14




NNootteess ££''000000 ££''000000 ££''000000 ££''000000


Currency gains 17 1

Income 2 2,768 1,798

Expenses 3 (86) (64)

Finance costs: interest 5 0 (2)


Taxation 4 (536) (351)


TToottaall rreettuurrnn bbeeffoorree ddiissttrriibbuuttiioonnss (16,593) 5,356

Finance costs: distributions 5 (2,169) (1,401)




££''000000 ££''000000 ££''000000 ££''000000


Movements due to sales and repurchases of shares:



(2,951) 12,650

Dilution levy 11 23


Retained distribution on accumulation shares 2,111 577


The above statement shows the comparative closing net assets at 30 September 2007 whereas the current accounting period commenced1 April 2008.


NNootteess 3300 SSeepptteemmbbeerr 22000088 3311 MMaarrcchh 22000088**

££''000000 ££''000000 ££''000000 ££''000000

AAsssseettss::


Debtors 6 1,169 297



Total assets 70,813 88,919

LLiiaabbiilliittiieess::

Derivative liabilities 0 0

Creditors 7 (1,662) (177)

Total other liabilities (1,662) (177)

Total liabilities (1,662) (177)

Net assets attributable to shareholders 69,151 88,742

*Last audited figures

The notes on pages 20 to 23 form an integral part of these financial statements.

SSttaatteemmeenntt ooff TToottaall RReettuurrnn

SSttaatteemmeenntt ooff CChhaannggee iinn SShhaarreehhoollddeerrss’’ NNeett AAsssseettss

BBaallaannccee SShheeeett



aass aatt 3300 SSeepptteemmbbeerr 22000088Bid-Market Percentage of

Holding or Value Total Net Nominal Value £'000 Assets AAuussttrriiaa ((22..5599%%)) 11,,002222 11..4488

7,000 OMV 164 0.24 51,945 Telekom Austria 507 0.73 13,300 Wiener Stadtische 351 0.51

BBeellggiiuumm ((33..1133%%)) 11,,009988 11..5599

355 Bekaert 26 0.04 9,305 Delhaize 297 0.43

87,148 Dexia 536 0.77 17 Distrigaz 'D' 89 0.13

2,624 Mobistar 103 0.15 1,725 Tessenderlo Chemie 47 0.07

CCzzeecchh RReeppuubblliicc ((00..0000%%)) 8888 00..1133

6,778 Telefonica 02 Czech 88 0.13

DDeennmmaarrkk ((11..4411%%)) 11,,551199 22..2200

10,675 Carlsberg Class 'B' 447 0.65 1,350 D/S Norden 35 0.05

31,850 Novo-Nordisk 904 1.31 5,400 William Demant 133 0.19

FFiinnllaanndd ((22..7722%%)) 11,,884455 22..6677

19,400 Fortum 350 0.51 102,391 Nokia 1,027 1.48 17,150 Outotec 253 0.37 27,583 Stora Enso Series 'R' 148 0.21

8,283 Tietoenator 67 0.10

FFrraannccee ((2200..8833%%)) 1166,,887733 2244..4400

14,420 Air France-KLM 181 0.26 8,750 Alstom 362 0.52

81,136 AXA 1,346 1.95 1,726 Beneteau 14 0.02

41,751 BNP Paribas 2,060 2.99 208 Bongrain 7 0.01

16,700 Cap Gemini 436 0.63 10,355 CIE Generale de Geophisique 179 0.26 34,607 Credit Agricole 354 0.51 17,600 Danone (Post-Subdivision) 685 0.99

8,932 EDF 352 0.51 4,709 Euro Aeronautic Defence Space 44 0.06 9,395 Eurotunnel 60 0.09

155,193 France Telecom 2,378 3.45 20,472 Gaz de France 569 0.82

970 Ginger 7 0.01 5,340 LVMH 259 0.37 2,959 Nexans 143 0.21

23,400 Orpea 537 0.78 10,300 Pernod Ricard 497 0.72 9,840 Peugeot 206 0.30 2,850 PPR 139 0.20 3,563 Rallye 57 0.08

31,064 Sanofi-Aventis 1,123 1.62 13,930 Ses Global Fiduciary (each representing 1 'A' Share) 156 0.23 19,014 Societe Generale 898 1.30

8,050 Sodexho Alliance 258 0.37 21,913 STMicroelectronics 120 0.17 22,053 Thomson 43 0.06 60,129 Total (Post-Subdivision) 1,911 2.76

3,941 Ubisoft Entertainment 148 0.21 78,396 Vivendi Universal 1,344 1.94

PPoorrttffoolliioo SSttaatteemmeenntt


16


Bid-Market Percentage of Holding or Value Total Net Nominal Value £'000 Assets GGeerrmmaannyy ((2200..6600%%)) 1144,,556688 2211..0066

6,511 Adidas-Salomon 192 0.28 1,955 Allianz (Registered) 143 0.21 1,571 Amadeus FiRe 16 0.02

11,608 BASF 306 0.43 412 Bauer 11 0.02

20,950 Bayer 847 1.21 4,304 Bayerische Motoren Werke 93 0.13 7,779 Celesio 186 0.27

22,392 DaimlerChrysler 608 0.88 13,474 Deutsche Boerse 661 0.96 69,087 Deutsche Lufthansa 748 1.08 17,945 Deutsche Post 206 0.30 65,690 E.On 1,777 2.56

546 Fielmann 21 0.03 21,600 Fresenius 857 1.24 6,083 Gerresheimer 149 0.22

27,328 Henkel Kgaa Non-Voting Preference 557 0.81 2,244 Iwka 11 0.02 6,850 K+S 268 0.39 4,437 Karstadt Quelle 8 0.01 3,141 Kloeckner (Registered) 39 0.06

15,570 Linde 906 1.31 16,678 Man 617 0.89

898 Medion 12 0.02 27,632 Metro 778 1.13 21,714 Muenchener Rueckve 1,840 2.65

5,516 Norddeutsche Affinerie 131 0.19 6,997 Oce 28 0.04

12,350 Rhoen-Klinikum 193 0.28 984 Salzgitter 55 0.08

23,250 SAP 677 0.98 2,150 SGL Carbon 46 0.07

13,826 Siemens (Registered) 711 1.03 10,409 Stada Arzneimittel (Registered) 237 0.34 38,054 Thyssenkrupp 629 0.91

939 Wirecard 4 0.01

GGrreeeeccee ((11..9900%%)) 441111 00..5599

1,957 Hellenic Exchanges 13 0.02 17,404 National Bank of Greece 398 0.57

HHuunnggaarryy ((00..0000%%)) 4488 00..0077

1,038 Magyar Olaj-es Gazipare Reszvenytar 48 0.07

IIrreellaanndd ((11..8833%%)) 886633 11..2255

116,555 Bank of Ireland 348 0.50 28,200 CRH 334 0.49 24,696 Elan 137 0.20 18,080 Smurfit Kappa 44 0.06

IIttaallyy ((66..8877%%)) 33,,441133 44..9944

2,447 AS Roma 1 0.00 1,536 Danieli & C 18 0.03

785 El.En. 13 0.02 111,409 Enel 508 0.73 113,251 ENI 1,636 2.37

922 IFI 6 0.01 43,568 Intek 13 0.02 32,983 Merloni Elettrodomestici 195 0.28

238,034 Pirelli 77 0.11 36,900 Saipem 593 0.86

158,500 Unicredito Italiano 353 0.51

PPoorrttffoolliioo SSttaatteemmeenntt ((ccoonnttiinnuueedd))



Bid-Market Percentage of Holding or Value Total Net Nominal Value £'000 Assets LLuuxxeemmbboouurrgg ((00..1199%%)) 11,,004455 11..5511

38,326 Arcelor 1,045 1.51

NNeetthheerrllaannddss ((99..5577%%)) 44,,996622 77..1188

7,255 Akzo Nobel 189 0.27 1,902 Arcelor (Dutch Line) 52 0.08

39,363 ASML 382 0.55 3,411 Draka 39 0.06

215 GreenergyCapital 0 0.00 34,764 Heineken 772 1.12

118,742 ING 1,320 1.91 2,110 KAS Bank 24 0.03

17,130 Koninklijke Ahold 111 0.16 70,100 Koninklijke KPN 565 0.82 25,482 Moolen (Van Der) 64 0.09

3,154 Ordina 12 0.02 108,987 Reed Elsevier 882 1.28

13,630 SBM Offshore 160 0.23 4,736 SNS Reaal 28 0.04

179 TomTom 2 0.00 23,232 TPG 360 0.52

NNoorrwwaayy ((22..2233%%)) 445522 00..6655

3,800 Ementor 9 0.01 33,800 Norsk Hydro 113 0.16 9,945 Norske Skogsindust 22 0.03 9,500 Odim Asa 63 0.09

22,550 Petroleum Geo Services 155 0.23 5,250 Yara International 90 0.13

PPoollaanndd ((00..0000%%)) 11,,005588 11..5533

954 Bank BPH 15 0.02 615 BRE Bank 44 0.06

23,958 KGHM Polska Miedz 274 0.40 54,966 Powszechna Kasa Oszczed 541 0.78 35,148 Telekomunikacja PO 184 0.27

PPoorrttuuggaall ((00..0000%%)) 337766 00..5544

64,055 Portugal Telecom 356 0.51 47,151 Sonae 20 0.03

SSppaaiinn ((44..9999%%)) 55,,668844 88..2222

68,556 Banco Bilbao Vizcaya Argentaria 602 0.87 209,701 Banco Santander Central Hispano 1,714 2.48

2,159 Construcciones Y Auxiliar de Ferrocarriles 429 0.62 8,146 Corporate Financeria Alba 183 0.26

26,100 Gamesa Corporacion Tecnologia 496 0.72 93,000 Iberdrola 511 0.74 9,199 Inditex 218 0.32

49,011 Repsol 788 1.14 56,600 Telefonica 743 1.07

SSwweeddeenn ((33..5566%%)) 11,,003344 11..5500

53,900 Alfa Laval 303 0.43 14,300 Electrolux Series 'B' 94 0.14 11,200 Hennes & Mauritz 253 0.37 18,160 JM 80 0.12 16,300 Kinnevik Series 'B' 40 0.06

3,900 Modern Times Series 'B' 76 0.11 8,000 NCC Series 'B' 44 0.06 1,000 PEAB Series 'B' 3 0.00 6,676 SAS 25 0.04 8,600 Scania Series 'B' 59 0.09 6,600 Skand Enskilda 57 0.08



18


Bid-Market Percentage of Holding or Value Total Net Nominal Value £'000 Assets SSwwiittzzeerrllaanndd ((1155..8866%%)) 1122,,009977 1177..4488

47,984 ABB 501 0.72 5,719 Adecco 135 0.20 7,685 Bobst 216 0.31

926 Bucher Industries 67 0.10 117 Centrals KFTWK 31 0.04

7 Conzzeta 8 0.01 12,640 Credit Suisse (Registered) 308 0.45

320 Daetwyler 10 0.01 389 Dufry (Registered) 9 0.01

24,150 EFG International 381 0.55 707 Fischer (Georg) 138 0.20 286 Forbo 48 0.07 785 Galen 154 0.22 560 Givaudan 258 0.37

22,300 Julius Baer 580 0.84 451 Kardex 10 0.01

7,965 Mobilezone 29 0.04 61,386 Nestle (Registered) 1,461 2.11

7,114 Nobel Biocare 128 0.19 78,105 Novartis (Registered) 2,292 3.31

680 Pargesa 32 0.05 20,428 Roche 1,778 2.57

196 SGS 127 0.18 7,670 Sulzer 447 0.65

480 Swatch (Registered) 48 0.07 13,001 Swiss Reinsurance (Registered) 386 0.56

5,250 Syngenta 617 0.89 2,519 Synthes 144 0.21

55,589 UBS 508 0.73 167 Valora 18 0.03 130 Vaudoise Assurance (Post subdivision) 12 0.02 419 Walter Meier 26 0.04

8,467 Zurich Financial Services 1,190 1.72

Portfolio of investments 68,456 98.99

Net other assets 695 1.01

TToottaall nneett aasssseettss 6699,,115511 110000..0000

All investments are listed on recognised stock exchanges and are "approved securities" within the meaning of the FSA Rules unless otherwise stated.The figures in brackets show the comparative percentage holdings as at 31 March 2008.




ffoorr tthhee ppeerriioodd 11 AApprriill 22000088 ttoo 3300 SSeepptteemmbbeerr 22000088

PPuurrcchhaasseess CCoosstt SSaalleess PPrroocceeeeddss

££''000000 ££''000000Arcelor 1,931 Nestle (Registered) 1,226BNP Paribas 1,197 Statoil 1,165Nokia 1,186 Total (Post-Subdivision) 1,058Banco Santander Central Hispano 1,096 voestalpine 1,044Allianz (Registered) 1,042 Allianz (Registered) 985Sanofi-Aventis 1,014 Fiat 965Continental 881 Koninklijke KPN 919Novartis (Registered) 850 Koninklijke Ahold 840Nestle (Registered) 799 Continental 809Muenchener Rueckve 763 Arcelor 739ING 756 Roche 715Societe Generale 742 Swatch (Registered) 689Vivendi Universal 726 Heineken 680SAP 706 L'Oreal 660Swiss Life 695 Air France-KLM 650Banco Bilbao Vizcaya Argentaria 630 ABB 627Powszechna Kasa Oszczed 615 Novartis (Registered) 614ABB 574 PPR 609KGHM Polska Miedz 549 Aegon 584Cap Gemini 540 Societe Generale 567Other purchases for the period 20,570 Other sales for the period 21,675

TToottaall ppuurrcchhaasseess dduurriinngg tthhee ppeerriioodd 3377,,886622 TToottaall ssaalleess dduurriinngg tthhee ppeerriioodd 3377,,882200

The above statement reflects the 20 largest aggregate purchases and sales during the period, or those purchases and sales greater than 2% of thenet asset value of the Fund at the start of the period where they number greater than 20.

SSuummmmaarryy ooff MMaatteerriiaall PPoorrttffoolliioo CChhaannggeess


20


11 NNeett ((lloosssseess))//ggaaiinnss oonn iinnvveessttmmeennttss dduurriinngg tthhee ppeerriioodd 3300 SSeepptteemmbbeerr 22000088 3300 SSeepptteemmbbeerr 22000077

££''000000 ££''000000

The net (losses)/gains on investments comprise:


NNeett ((lloosssseess))//ggaaiinnss oonn iinnvveessttmmeennttss (18,756) 3,974

22 IInnccoommee 3300 SSeepptteemmbbeerr 22000088 3300 SSeepptteemmbbeerr 22000077

££''000000 ££''000000

Bank interest 22 41

Overseas dividends 2,720 1,704



33 EExxppeennsseess 3300 SSeepptteemmbbeerr 22000088 3300 SSeepptteemmbbeerr 22000077

££''000000 ££''000000

PPaayyaabbllee ttoo tthhee AAuutthhoorriisseedd CCoorrppoorraattee DDiirreeccttoorr,, aassssoocciiaatteess ooff tthhee AAuutthhoorriisseedd CCoorrppoorraattee DDiirreeccttoorr aanndd aaggeennttss ooff eeiitthheerr ooff tthheemm::



36 29

PPaayyaabbllee ttoo tthhee DDeeppoossiittaarryy,, aassssoocciiaatteess ooff tthhee DDeeppoossiittaarryy aanndd aaggeennttss ooff bbootthh ooff tthheemm::


Handling charges taken from capital account (see note 5) 23 20

Safe custody fees 11 (2)

44 29

OOtthheerr eexxppeennsseess::

Audit fees 6 6

6 6


44 TTaaxxaattiioonn 3300 SSeepptteemmbbeerr 22000088 3300 SSeepptteemmbbeerr 22000077

££''000000 ££''000000





CCuurrrreenntt ttaaxx cchhaarrggee ffoorr tthhee ppeerriioodd ((sseeee nnoottee 44 ((bb)))) 544 377

Deferred tax credit for the period (see note 4 (c)) (8) (26)



The tax assessed for the period is different from the standard rate of corporation tax in the UK for an open-ended investmentcompany (20%). The differences are explained below:


Corporation tax at 20% (2007 - 20%) 536 347

Effects of:





Movement in DTR for deferred tax 1 28

Precompte (1) 0

Stock dividends not subject to corporation tax (5) 0

Tax on Special dividends in capital 1 0

CCuurrrreenntt ttaaxx cchhaarrggee ffoorr tthhee ppeerriioodd ((sseeee NNoottee 44 ((aa)))) 544 377

Open Ended Investment Companies are exempt from tax on capital gains in the UK. Therefore, any capital return is not includedin the above reconciliation.

NNootteess ttoo tthhee FFiinnaanncciiaall SSttaatteemmeennttss


44 TTaaxxaattiioonn ((ccoonnttiinnuueedd)) 3300 SSeepptteemmbbeerr 22000088 3300 SSeepptteemmbbeerr 22000077

££''000000 ££''000000



Deferred tax credit for the period (see note 4 (a)) (8) (26)


55 FFiinnaannccee ccoossttss 3300 SSeepptteemmbbeerr 22000088 3300 SSeepptteemmbbeerr 22000077

££''000000 ££''000000

The distributions take account of income received on the creation of shares and income deducted on the cancellation of shares and comprise:

Interim distribution 2,111 577

Income deducted on cancellation of shares 101 970



Interest 0 2




Handling charges taken from the capital acoount (see note 3) 23 20


Details of the distribution are set out on page 24.

66 DDeebbttoorrss 3300 SSeepptteemmbbeerr 22000088 3311 MMaarrcchh 22000088

££''000000 ££''000000

Accrued income 8 47


Sales awaiting settlement 941 117

TToottaall ddeebbttoorrss 1,169 297

77 CCrreeddiittoorrss 3300 SSeepptteemmbbeerr 22000088 3311 MMaarrcchh 22000088

££''000000 ££''000000

Accrued ACD's periodic charges 11 31

Accrued audit fees 5 10

Accrued Depositary's fees 3 9


Accrued registration fees 6 15

Accrued safe custody fees 1 6




Purchases awaiting settlement 832 20

TToottaall ccrreeddiittoorrss 1,662 177


NNootteess ttoo tthhee FFiinnaanncciiaall SSttaatteemmeennttss ((ccoonnttiinnuueedd))


22

88 RReellaatteedd ppaarrttyy ttrraannssaaccttiioonnss

Standard Life Investments (Mutual Funds) Limited, as Authorised Corporate Director (ACD), is a related party and acts as principal in respectof all transactions of shares in the Company. The aggregate monies received through issue and paid on cancellation are disclosed in theStatement of Change in Shareholders' Net Assets. Any amounts due to or from Standard Life Investments (Mutual Funds) Limited at the endof the accounting period are disclosed in notes 6 and 7.


11 AApprriill 22000088 ttoo 11 AApprriill 22000077 ttoo

3300 SSeepptteemmbbeerr 22000088 3311 MMaarrcchh 22000088

££''000000 ££''000000

Transactions during the period with Standard Life Group companies are as follows:

Sale of shares 2,479 20,169

Purchase of shares 5,336 16,856

The percentage value of the Fund held by Standard Life Group companies is: 97.34% 97.06%

99 SShhaarree ccllaasssseess

The Fund currently has four share classes in issue: Retail Accumulation, Institutional Accumulation, Standard Life Accumulation and PensionAccumulation.

The current annual ACD charge as a percentage of daily net asset value is as follows:

Retail Accumulation 1.85%

Institutional Accumulation 1.00%

Standard Life Accumulation 0.00%

Pension Accumulation 0.00%

The net asset value for each share class, the net asset value per share and the number of shares in issue in each share class are given in thecomparative tables on page 13. The distribution per share class is given in the distribution tables on page 24.

All four share classes have the same rights on winding up.

1100 DDeerriivvaattiivveess aanndd ootthheerr ffiinnaanncciiaall iinnssttrruummeennttss

The analysis and tables provided refer to the narrative disclosure on Derivatives and Other Financial Instrument risks on page 6.

((aa)) CCuurrrreennccyy eexxppoossuurreess

A substantial proportion of the net assets of the sub-fund are denominated in currencies other than sterling, with the effect that thebalance sheet and total return can be significantly affected by currency movements.

NNeett ffoorreeiiggnn ccuurrrreennccyy aasssseettss//((lliiaabbiilliittiieess))MMoonneettaarryy NNoonn mmoonneettaarryy EExxppoossuurreess EExxppoossuurreess TToottaall

3300 SSeepptteemmbbeerr 22000088CCuurrrreennccyy ££''000000 ££''000000 ££''000000Czech koruna 0 88 88Danish krone 7 1,520 1,527Euro 464 52,196 52,660Norwegian kroner 1 353 354Polish zloty 0 1,058 1,058Swedish krona 160 12,389 12,549Swiss franc 1 (830) (829)US dollar 275 0 275TToottaall 908 66,774 67,682

3311 MMaarrcchh 22000088CCuurrrreennccyy ££''000000 ££''000000 ££''000000Danish krone 3 1,257 1,260Euro 546 66,921 67,467Norwegian kroner 81 1,961 2,042Swedish krona 106 3,106 3,212Swiss franc 101 14,084 14,185TToottaall 837 87,329 88,166




1100 DDeerriivvaattiivveess aanndd ootthheerr ffiinnaanncciiaall iinnssttrruummeennttss ((ccoonnttiinnuueedd))

((bb)) IInntteerreesstt rraattee rriisskk pprrooffiillee ooff ffiinnaanncciiaall aasssseettss aanndd lliiaabbiilliittiieess

The interest rate risk profile of the financial assets and liabilities at the balance sheet date was as follows:

FFllooaattiinngg rraattee FFiinnaanncciiaall aasssseettss//ffiinnaanncciiaall aasssseettss// ((lliiaabbiilliittiieess)) nnoott

((lliiaabbiilliittiieess)) ccaarrrryyiinngg iinntteerreesstt TToottaall3300 SSeepptteemmbbeerr 22000088 ££''000000 ££''000000 ££''000000Czech koruna 0 88 88Danish krone 7 1,520 1,527Euro 464 52,196 52,660Norwegian kroner 1 353 354Polish zloty 0 1,058 1,058Sterling 280 1,189 1,469Swedish krona 160 12,389 12,549Swiss franc 1 (830) (829)US dollar 275 0 275TToottaall 1,188 67,963 69,151

3311 MMaarrcchh 22000088Danish krone 3 1,257 1,260Euro 546 66,921 67,467Norwegian kroner 81 1,961 2,042Sterling 562 14 576Swedish krona 106 3,106 3,212Swiss franc 101 14,084 14,185TToottaall 1,399 87,343 88,742

((cc)) FFaaiirr vvaalluuee ooff tthhee ffiinnaanncciiaall aasssseettss aanndd ffiinnaanncciiaall lliiaabbiilliittiieess

There is no material difference between the value of the financial assets and liabilities, as shown in the Balance Sheet, and their fairvalue.

The market value of the investments is taken to equal 'fair value' for the purposes of FRS 13. Given all the activities of the Company,none of the investments held fall within the definition of 'investments held for trading' as set out in FRS 13.

The base currency of the Company is Sterling. For the purpose of disclosures required by FRS 13, this is taken to be the 'functionalcurrency' of the Company.

The borrowing facilities available to the Company as at 30 September 2008 comprise an overdraft facility of 10% of the value of theCompany. The overdraft is repayable on demand. Overdraft balances attract interest based on 1% above the base rates. Creditbalances receive interest at the Depositary's 'call rate'.

dd)) SSeennssiittiivviittyy aannaallyyssiiss

There were no derivatives of a material nature held by the Fund during the accounting period.

1111 PPoorrttffoolliioo ttrraannssaaccttiioonn ccoossttss11 AApprriill 22000088 ttoo 11 AApprriill 22000088 ttoo 11 AApprriill 22000077 ttoo 11 AApprriill 22000077 ttoo

3300 SSeepptteemmbbeerr 22000088 3300 SSeepptteemmbbeerr 22000088 3300 SSeepptteemmbbeerr 22000077 3300 SSeepptteemmbbeerr 22000077££''000000 ££''000000 ££''000000 ££''000000

Analysis of total purchase costs:Purchases in period before transaction costs 37,816 39,829Commissions and other costs (including stamp duty) 46 42Total purchases costs 46 42GGrroossss ppuurrcchhaasseess ttoottaall 37,862 39,871

11 AApprriill 22000088 ttoo 11 AApprriill 22000088 ttoo 11 AApprriill 22000077 ttoo 11 AApprriill 22000077 ttoo3300 SSeepptteemmbbeerr 22000088 3300 SSeepptteemmbbeerr 22000088 3300 SSeepptteemmbbeerr 22000077 3300 SSeepptteemmbbeerr 22000077

££''000000 ££''000000 ££''000000 ££''000000Analysis of total sales costs:Sales in period before transaction costs 37,865 26,491Commissions and other costs (45) (28)Total sales costs (45) (28)TToottaall ssaalleess nneett ooff ttrraannssaaccttiioonn ccoossttss 37,820 26,463

1122 CCoonnttiinnggeenntt lliiaabbiilliittiieess

The Fund had no contingent liabilities at the balance sheet date (31 March 2008 - £nil).




24

IInntteerriimm ddiissttrriibbuuttiioonn ffoorr tthhee ppeerriioodd eennddeedd 3300 SSeepptteemmbbeerr 22000088Group 1 - Shares purchased on or before 31 March 2008Group 2 - Shares purchased from 1 April 2008 and up to 30 September 2008

DDiissttrriibbuuttiioonn ppaayyaabbllee DDiissttrriibbuuttiioonn ppaaiiddNNeett iinnccoommee **EEqquuaalliissaattiioonn 2288 NNoovveemmbbeerr 22000088 3300 NNoovveemmbbeerr 22000077

ppeennccee ppeerr sshhaarree ppeennccee ppeerr sshhaarree ppeennccee ppeerr sshhaarree ppeennccee ppeerr sshhaarreeRReettaaiill aaccccuummuullaattiioonn CCllaassss 11Group 1 2.7851 - 2.7851 1.5027Group 2 0.0000 2.7851 2.7851 1.5027

IInnssttiittuuttiioonnaall aaccccuummuullaattiioonn CCllaassss 22 Group 1 3.5045 - 3.5045 1.9954Group 2 3.5045 0.0000 3.5045 1.9954

SSttaannddaarrdd LLiiffee aaccccuummuullaattiioonn CCllaassss 33Group 1 4.4168 - 4.4168 3.1373Group 2 2.3695 2.0473 4.4168 3.1373

PPeennssiioonn aaccccuummuullaattiioonn CCllaassss 44Group 1 1.2220 - 1.2220 0.0200Group 2 0.3259 0.8961 1.2220 0.0200

*Please see equalisation note in accounting policies.

Corporate shareholders should account for the current period's dividend distributions shown in the distribution tables as follows:

IInntteerriimm ddiivviiddeennddddiissttrriibbuuttiioonn

Treat as UK corporate dividend 0.00%Treat as unfranked investment income* 100.00%

*After deduction of income tax at the lower rate, this amount is liable to corporation tax.


DDiissttrriibbuuttiioonn TTaabbllee

TTrreeaattmmeenntt bbyy CCoorrppoorraattee SShhaarreehhoollddeerrss




IInnvveessttmmeenntt PPoolliiccyyThe investment policy of the Fund is to invest primarily in equities and equity type investments ofcompanies incorporated in Japan or which in the opinion of the Investment Adviser (or sub-adviser),carry on a substantial part of their operations in Japan. "Equity type investments" will include convertible stocks, stock exchange listed warrants,depositary receipts and any other such investments which entitle the holder to subscribe for or convert into the equity of the company and/orwhere the share price performance is, in the opinion of the Investment Adviser (or sub-adviser), influenced significantly by stock marketperformance of the company's ordinary shares. The Fund may also invest in deposits, money market instruments and collective investmentschemes.


EEnnvviirroonnmmeennttJapan was the only major stock market to post positive returns during the second quarter of 2008, benefiting from its limited exposure to westerncredit markets. The period, nevertheless, was volatile, as corporate profitability deteriorated sharply, and higher input costs and the negative impactof the stronger yen squeezed company earnings.

In line with their global counterparts, Japanese equities fell over the third quarter of the year, depressed by the continued downturn in globalgrowth and the threat of a domestic recession. Having previously benefited from its limited exposure to western financial markets, the Japanesemarket could not help but succumb to widespread negative momentum. Japan also faced slowing domestic growth, rising inflation and a softerlabour market. On a more positive note, US weakness was partly offset by healthy demand from emerging markets for Japanese goods. The trendof US consumers downsizing cars to more economical vehicles also benefited Japan’s auto assemblers, who gained significant market share.

AAccttiivviittyyDuring the first half of the period, the Fund’s managers added to Daiwa Securities Group, on the belief that the company would benefit from ageneral trend away from deposits. Sumitomo Trust was sold in order to purchase Mizuho Financial Group, which appeared less vulnerable to theeffects of the global financial crisis.

In the second half, a position was initiated in fax manufacturer Ricoh, following its acquisition of Ikon Office Solutions, and financial stockMitsubishi UFJ, which took a 21% stake in Morgan Stanley. Both deals offered growth opportunities. Sales included Canon after its share price slidin response to weakening US consumer demand, and shipping operator Mitsui O.S.K. Lines as commodity prices looked likely to fall further.

PPeerrffoorrmmaannccee The Japan Equity Fund benefited from an overweight exposure to the energy sector in the first half of the period, as well as limited investmentswithin the utilities sector. Japanese financials, unlike their US and European counterparts, rebounded, which meant that the Fund’s underweightexposure to financial names was generally negative for performance. However, both Aeon Credit and Aeon Mall Co made positive contributions toFund returns.

The more resilient sectors over the third quarter of the year were those with defensive earnings characteristics. Fund performance suffered on theback of overweight exposure to the energy sector, as oil and commodity prices began to moderate. Limited investment in the utilities sector wasalso negative.

OOuuttllooookkThe Japanese economy remains highly dependent upon external demand, and while global growth slows, a moderate recession is expected.

While US economic recovery is unlikely in the near term, other sources of demand for Japanese goods will provide support, particularly from globalemerging markets.

In the current environment, the balance sheet strength of Japanese companies remains solid compared to western peers, and provides someprotection.

Companies’ return on equity is historically high, as they work their asset bases harder to generate shareholder returns.


JJaappaanneessee EEqquuiittyy MMaannaaggeerr ooff MMaannaaggeerrss FFuunndd

IInnvveessttmmeenntt SSuubb--AAddvviisseerrssNNeeww SSttaarr IInnssttiittuuttiioonnaall MMaannaaggeerrss LLiimmiitteedd

DDaaiiwwaa SSBB IInnvveessttmmeennttss UUSSAA LLttdd


BBeenncchhmmaarrkk IMA Japan Sector


26


££''000000 ppRetail Accumulation 31 March 2006 560 359,451 155.68Retail Accumulation 31 March 2007 763 587,182 129.96Retail Accumulation 31 March 2008 447 426,835 104.81Retail Accumulation 30 September 2008 367 382,740 95.89











TToottaall EExxppeennssee RRaattiioo ((TTEERR))RReettaaiill IInnssttiittuuttiioonnaall SSttaannddaarrdd LLiiffee PPeennssiioonn

sshhaarree ccllaassss sshhaarree ccllaassss sshhaarree ccllaassss sshhaarree ccllaassssAs at 31 March 2007 2.04% 1.04% 0.03% n/aAs at 31 March 2008 2.11% 1.12% 0.11% 0.07%As at 30 September 2008 2.17% 1.17% 0.17% 0.11%







NNootteess ££''000000 ££''000000 ££''000000 ££''000000

Net losses on investments during the period 1 (1,635) (1,030)

Currency gains 13 9

Income 2 161 148


Net income before taxation 135 117

Taxation 4 (28) (25)

Net income after taxation 107 92

TToottaall rreettuurrnn bbeeffoorree ddiissttrriibbuuttiioonnss (1,515) (929)

Finance costs: distributions 5 (114) (103)

CChhaannggee iinn nneett aasssseettss aattttrriibbuuttaabbllee ttoo sshhaarreehhoollddeerrss (1,629) (1,032)



££''000000 ££''000000 ££''000000 ££''000000



Amounts receivable for creation of shares 481 14,626


(570) 2,507

Dilution levy 2 13

Change in net assets attributable to shareholders (1,629) (1,032)

Retained distribution on accumulation shares 114 97


The above statement shows the comparative closing net assets at 30 September 2007 whereas the current accounting period commenced 1 April 2008.



££''000000 ££''000000 ££''000000 ££''000000

AAsssseettss::

PPoorrttffoolliioo ooff iinnvveessttmmeennttss 16,703 18,878

Debtors 6 404 448

Cash and bank balances 509 321

Total other assets 913 769

TToottaall aasssseettss 17,616 19,647



Creditors 7 (359) (487)

Bank overdraft (180) 0

Total other liabilities (539) (487)

Total liabilities (539) (487)

NNeett aasssseettss aattttrriibbuuttaabbllee ttoo sshhaarreehhoollddeerrss 17,077 19,160








28


Holding or Value Total Net Nominal Value £'000 Assets BBaassiicc MMaatteerriiaallss ((1100..0044%%)) 11,,443388 88..4422

20,000 Aichi Steel 45 0.26 35,000 Asahi Kasei 81 0.48 23,000 Daicel Chemical Industries 57 0.33 32,600 Hitachi Metals 213 1.25 1,000 Kyoei Steel 10 0.06

17,000 Nihon Nohyaku 53 0.31 6,000 Nihon Parkerizing 37 0.22

47,000 Nippon Steel 96 0.56 33,000 Oji Paper 91 0.53 14,900 Shin-Etsu Chemical 383 2.24 41,000 Sumitomo Chemical 98 0.58 78,000 Sumitomo Metal Industries 130 0.76

600 Taiyo Nippon Sanso 3 0.02 28,000 Toyo Ink 45 0.26 66,000 UBE Industries 96 0.56

CCoonnssuummeerr GGooooddss ((1199..7788%%)) 33,,557733 2200..9922

2,700 Aisin Seiki 36 0.21 19,000 Ajinomoto 100 0.59 7,100 Bridgestone 73 0.43

16,000 Daihatsu Motor 96 0.56 9,000 Daiwa House Industry 47 0.27

13,500 Denso 180 1.05 7,000 Fuji Film 99 0.58

11,900 Honda Motor 193 1.13 9,300 Hudson Soft 79 0.46

126 Japan Tobacco 261 1.52 8,000 Kao 119 0.70 6,100 Makita 68 0.40

22,000 Meiji Dairies 65 0.38 7,000 Namco Bandai 42 0.25

500 Nintendo 114 0.67 21,100 Nissan Motor 77 0.45 14,000 Nisshin Seifun 103 0.60 17,000 Panasonic 160 0.94 5,100 Shimano 97 0.57 3,500 Shiseido 43 0.25 9,700 Sony 162 0.95

31,000 Sumitomo Electric 185 1.08 21,400 Sumitomo Forestry 68 0.40 20,800 Sumitomo Rubber 101 0.59 40,000 Toyota Motor 920 5.39 2,000 Uni-Charm 85 0.50

CCoonnssuummeerr SSeerrvviicceess ((77..7766%%)) 11,,333388 77..8844

11,600 DCM Japan 45 0.26 84 Dentsu 93 0.54

10,900 Douter Nichires 90 0.53 112 East Japan Railway 463 2.71

3,100 Nitori 102 0.60 15,400 Seven & I 243 1.42 4,700 Shimachu 58 0.34

40 West Japan Railway 95 0.56 6,100 Xebio 65 0.39 2,020 Yamada Denki 84 0.49

FFiinnaanncciiaallss ((1144..4466%%)) 33,,332200 1199..4444

33,000 Aioi Insurance 88 0.51 65,000 Bank of Yokohama 172 1.01

27 Japan Retail Fund 61 0.36 14,000 Mitsubishi Estate 148 0.87

203,400 Mitsubishi UFJ 956 5.60 30,000 Mitsui Fudosan 309 1.81




Bid-Market Percentage of Holding or Value Total Net Nominal Value £'000 Assets FFiinnaanncciiaallss ((ccoonnttiinnuueedd))

6,500 Mitsui Sumitomo 119 0.70 139 Mizuho Financial 323 1.89

58,600 Nomura 409 2.39 1,370 Orix 91 0.53

112 Resona 80 0.47 22 Seven Bank 32 0.19 55 Sumitomo Mitsui Financial 182 1.06

33,000 Sumitomo Trust & Banking 116 0.68 9,800 Tokio Marine 193 1.13

16,000 Tokyo Tatemono 41 0.24

HHeeaalltthh CCaarree ((44..4433%%)) 11,,000055 55..8899

2,000 Astellas Pharmaceutical 46 0.27 3,000 Daiichi Sankyo 43 0.25 2,000 Kyorin 13 0.08 8,300 Nihon Kohden 85 0.50 2,900 Ono Pharmaceutical 74 0.44

15,000 Rohto Pharmaceutical 94 0.55 19,800 Takeda Pharmaceutical 547 3.20

3,600 Terumo 103 0.60

IInndduussttrriiaallss ((2266..7777%%)) 33,,110022 1188..1177

22,000 Asahi Glass 106 0.62 10,000 Daifuku 34 0.20

7,500 Fanuc 305 1.79 5,600 Hamamatsu 75 0.44

10,600 Hitachi Construction Machinery 141 0.83 5,100 Hoya 55 0.32

22,000 Itochu 72 0.42 8,300 JS Group 58 0.34

13,000 Kajima 21 0.12 72,000 Kawasaki Heavy Industries 82 0.48 16,000 Kawasaki Kisen Kaisha 53 0.31 30,300 Komatsu 267 1.57 1,300 Kyocera 54 0.32

37,600 Mitsubishi 427 2.50 39,000 Mitsubishi Electric 142 0.83 87,000 Mitsubishi Heavy Industries 204 1.19 23,000 Mitsui 155 0.91 16,000 Mitsui O.S.K. Lines 75 0.44

7,000 NGK Insulators 46 0.27 4,600 Nidec 154 0.90

36,000 Nippon Express 88 0.51 22,000 Nippon Yusen 77 0.45

2,300 Secom 53 0.31 25,400 Sumitomo 129 0.76

58 Tempstaff 22 0.13 12,100 Ushio 109 0.64 6,300 Yamatake 55 0.32

14,000 Yaskawa 43 0.25

OOiill && GGaass ((33..3300%%)) 558888 33..4444

1,300 Idemitsu Kosan 58 0.34 86 Inpex 405 2.37

9,800 Modec 125 0.73




30

Bid-Market Percentage of Holding or Value Total Net Nominal Value £'000 Assets TTeecchhnnoollooggyy ((88..5599%%)) 11,,336611 77..9977

13,100 Canon 264 1.55 4,900 Canon Marketing 41 0.24

12,500 Capcom 196 1.15 16,000 Fujitsu 49 0.29

8,200 Hitachi High-Technologies 89 0.52 32,000 NEC 74 0.43 16,100 Nomura Research Institute 180 1.05

25 NTT Data 54 0.32 32,000 Ricoh 244 1.43 4,900 Square Enix 79 0.46 3,600 Star Micronics 20 0.12 2,900 Tokyo Electron 71 0.41

TTeelleeccoommmmuunniiccaattiioonnss ((22..4400%%)) 883344 44..8888

53 Kiddi 164 0.96 90 Nippon Telegraph & Telephone 222 1.30

507 NTT DoCoMo 448 2.62

UUttiilliittiieess ((11..0000%%)) 114444 00..8844

5,600 Kansai Electric Power 69 0.40 6,300 Tohoku Electric Power 75 0.44










££''000000 ££''000000Canon 531 Sumitomo Mitsui Financial 548Mizuho Financial 440 Japan Tobacco 438Sumitomo Mitsui Financial 401 Sumitomo Metal Industries 353NTT DoCoMo 399 Mitsui 322Mitsubishi Tokyo 392 NTT DoCoMo 312Nomura 379 JFE 310Mitsubishi 353 Mitsui O.S.K. Lines 301Denso 297 Toshiba 292Millea 293 Tokyo Electric Power 277Japan Tobacco 262 Daiichi Sankyo 263Toyota Motor 260 Shiseido 250Inpex 255 Kao 234Nippon Telegraph & Telephone 242 Mitsui Fudosan 228Sumitomo Trust & Banking 242 Nippon Electric Glass 228Mitsubishi Heavy Industries 235 West Japan Railway 202Ricoh 223 Astellas Pharmaceutical 198Asahi Glass 219 Modec 196Daiichi Sankyo 217 Daiwa Securities 192Nomura Research Institute 214 Nippon Telegraph & Telephone 192Takeda Pharmaceutical 206 Itochu 191Other purchases for the period 10,619 Other sales for the period 11,691


The above statement reflects the 20 largest aggregate purchases and sales during the period, or those purchases and sales greater than 2% of thenet asset value of the Fund at the start of the period where they number greater than 20. In the instance where there are less than 20 purchases orsales during the period all purchases and sales are shown.




32

11 NNeett lloosssseess oonn iinnvveessttmmeennttss dduurriinngg tthhee ppeerriioodd 3300 SSeepptteemmbbeerr 22000088 3300 SSeepptteemmbbeerr 22000077

££''000000 ££''000000

The net losses on investments comprise:

Losses on non-derivative securities (1,635) (1,030)

NNeett lloosssseess oonn iinnvveessttmmeennttss (1,635) (1,030)


££''000000 ££''000000

Bank interest 2 6

Overseas dividends 159 142

TToottaall iinnccoommee 161 148


££''000000 ££''000000

PPaayyaabbllee ttoo tthhee AAuutthhoorriisseedd CCoorrppoorraattee DDiirreeccttoorr ((AACCDD)),, aassssoocciiaatteess oofftthhee AACCDD aanndd aaggeennttss ooff eeiitthheerr ooff tthheemm::



10 9




Safe custody fees 1 2

10 16


Audit fees 6 6

6 6



((aa)) AAnnaallyyssiiss ooff ttaaxx cchhaarrggee ffoorr tthhee ppeerriioodd ££''000000 ££''000000





Deferred tax credit for the period (see note 4 (c)) (2) (1)






Effects of:












((cc)) DDeeffeerrrreedd ttaaxxaattiioonn £'000 £'000




55 FFiinnaannccee ccoossttss



££''000000 ££''000000

Interim distribution 114 97


Income received on creation of shares 0 (1)

NNeett ddiissttrriibbuuttiioonnss ffoorr tthhee ppeerriioodd 114 103

Interest 0 0

TToottaall ffiinnaannccee ccoossttss 114 103





Details of the distributions are set out on page 36.


££''000000 ££''000000

Accrued income 143 155


TToottaall ddeebbttoorrss 404 448


££''000000 ££''000000






Accrued safe custody fee (1) 1




TToottaall ccrreeddiittoorrss 359 487


Standard Life Investments (Mutual Funds) Limited, as Authorised Corporate Director (ACD), is a related party and acts as principal inrespect of all transactions of shares in the Company. The aggregate monies received through issue and paid on cancellation aredisclosed in the Statement of Change in Shareholders' Net Assets. Any amounts due to or from Standard Life Investments (MutualFunds) Limited at the end of the accounting period are disclosed in notes 6 and 7.

Amounts payable to Standard Life Investments (Mutual Funds) Limited, in respect of periodic charge and registration services aredisclosed in note 3 and the amounts due at the period end are disclosed in note 7.



££''000000 ££''000000


Sale of shares 509 3,452






34


The Fund currently has four share classes in issue. The current annual ACD charge as a percentage of daily net asset value is as follows:












3300 SSeepptteemmbbeerr 22000088CCuurrrreennccyy ££''000000 ££''000000 ££''000000Japanese yen 509 16,841 17,350TToottaall 509 16,841 17,350

3311 MMaarrcchh 22000088CCuurrrreennccyy ££''000000 ££''000000 ££''000000Japanese yen 223 18,913 19,136TToottaall 223 18,913 19,136


The interest rate risk profile of the financial assets and liabilities at the balance sheet date was as follows:FFllooaattiinngg rraattee FFiinnaanncciiaall aasssseettss//

ffiinnaanncciiaall aasssseettss// FFiixxeedd rraattee ((lliiaabbiilliittiieess)) nnoott((lliiaabbiilliittiieess)) ffiinnaanncciiaall aasssseettss ccaarrrryyiinngg iinntteerreesstt TToottaall

3300 SSeepptteemmbbeerr 22000088 ££''000000 ££''000000 ££''000000 ££''000000Japanese yen 509 0 16,841 17,350Sterling (180) 0 (93) (273)TToottaall 329 0 16,748 17,077

3311 MMaarrcchh 22000088 ££''000000 ££''000000 ££''000000 ££''000000Japanese yen 223 0 18,913 19,136Sterling 98 0 (74) 24TToottaall 321 0 18,839 19,160





The borrowing facilities available to the company as at 30 September 2008 comprise an overdraft facility of 10% of the value of theCompany. The overdraft is repayable on demand. Overdraft balances attract interest based on 1% above the base rates.

Credit balances receive interest at the Depositary's 'call rate'.

((dd)) SSeennssiittiivviittyy aannaallyyssiiss









££''000000 ££''000000 ££''000000 ££''000000

Analysis of total sales costs:Sales in period before transaction costs 17,229 18,054Commissions and other costs (11) (22)Total sales costs (11) (22)TToottaall ssaalleess nneett ooff ttrraannssaaccttiioonn ccoossttss 17,218 18,032


The sub-fund had no contingent liabilities at the balance sheet date (31 March 2008 - £nil).




36

IInntteerriimm ddiissttrriibbuuttiioonn ffoorr tthhee ppeerriioodd eennddeedd 3300 SSeepptteemmbbeerr 22000088

Group 1 - Shares purchased on or before 31 March 2008Group 2 - Shares purchased from 1 April 2008 and up to 30 September 2008


ppeennccee ppeerr sshhaarree ppeennccee ppeerr sshhaarree ppeennccee ppeerr sshhaarree ppeennccee ppeerr sshhaarree

RReettaaiill aaccccuummuullaattiioonn CCllaassss 11Group 1 0.0000 - 0.0000 0.0000Group 2 0.0000 0.0000 0.0000 0.0000















IInnvveessttmmeenntt PPoolliiccyyThe investment policy of the Fund is to invest primarily in equities and equity type investments ofcompanies incorporated in North America or which in the opinion of the Investment Adviser (or sub-adviser), carry on a substantial part of their operations in North America. "Equity type investments"will include convertible stocks, stock exchange listed warrants, depositary receipts and any othersuch investments which entitle the holder to subscribe for or convert into the equity of the companyand/or where the share price performance is, in the opinion of the Investment Adviser (or sub-adviser), influenced significantly by stock market performance of the company's ordinary shares. TheFund may also invest in deposits, money market instruments and collective investment schemes.


EEnnvviirroonnmmeennttIn the first half of the period, US equities staged an early rally before later retreating, amid concerns over the health of financials and the seeminglyinexorable rise in the oil price.

The second quarter of 2008 proved extremely erratic, with stock markets fluctuating sharply amid a raft of negative economic and financial sectornews. Severe volatility hurt the market in September, as a host of high-profile banking failures, including Lehman Brothers and Washington Mutual,created an extraordinary trading environment. In an attempt to restore confidence to markets, US politicians announced a bipartisan agreement ona $700 billion rescue plan, although the eventual rejection of the bail-out by Congress caused world markets to plummet late in the period.

AAccttiivviittyy

Early in the period, the Fund’s managers initiated a position in MasterCard, as the firm exhibited strong growth potential on the back of the wide-spread transition from traditional, paper-based payment forms to electronic transfers. Falling machinery stock prices prompted the sale of Deere &Co., while EMC Corp. was sold in order to provide funds for more attractive purchases.

In the second half, the Fund’s managers added Verisign to the portfolio, on an attractive valuation. Meanwhile, the Fund’s position in Safeway wasreduced in order to raise capital for the purchase of other, more compelling opportunities.

PPeerrffoorrmmaannccee The US Equity Manager of Managers Fund outperformed its benchmark during the second quarter of 2008, boosted by its underweight exposureto financials, which retreated sharply. Stock picks within the IT sector, including Activision Blizzard and Adobe, were also particularly beneficial.

However, Fund performance suffered into the second part of the period, undermined by stock selection in the technology, materials and industrialssectors. On the upside, stock picks within the healthcare sector, along with underweight exposure to energy stocks, were positive for performance.

OOuuttllooookkDeteriorating US economic figures all point to a significant and protracted squeeze on corporate profitability.

Within the housing sector, excess supply, foreclosures and lack of credit will continue to weigh on house prices for longer.

Although valuations are attractive, fuller details of the Troubled Asset Relief Program and improved liquidity would boost confidence. The regulatoryresponse will be critical.


NNoorrtthh AAmmeerriiccaann MMaannaaggeerr ooff MMaannaaggeerrss FFuunndd

IInnvveessttmmeenntt SSuubb--AAddvviisseerrssAAccaaddiiaann AAsssseett MMaannaaggeemmeenntt IInncc

DDeellaawwaarree IInnvveessttmmeenntt AAddvviissoorrss,, aa sseerriieess ooffDDeellaawwaarree MMaannaaggeemmeenntt BBuussiinneessss TTrruusstt

SSyysstteemmaattiicc FFiinnaanncciiaall MMaannaaggeemmeenntt LLPP

VViiccttoorryy CCaappiittaall MMaannaaggeemmeenntt IInncc


BBeenncchhmmaarrkk IMA North America Sector


38





Pension Accumulation 31 March 2008* 29,896 69,521,296 43.00Pension Accumulation 30 September 2008 28,230 73,873,304 38.21







*To 30 September 2008**From the launch of the Fund on 20 February 2004 to 31 December 2004*** From the commencement of the share class on 17 September 2007


AAss aatt sshhaarree ccllaassss sshhaarree ccllaassss sshhaarree ccllaassss sshhaarree ccllaassss31 March 2007 1.89% 1.04% 0.04% n/a31 March 2008 1.92% 1.07% 0.07% 0.05%30 September 2008 1.96% 1.11% 0.11% 0.05%






NNootteess 3300 SSeepptteemmbbeerr 22000088 3300 SSeepptteemmbbeerr 22000077

££''000000 ££''000000 ££''000000 ££''000000

Net losses on investments during the period 1 (9,398) (214)

Currency gains/(losses) 63 (87)

Income 2 559 726


Finance costs: interest 5 0 0


Taxation 4 (97) (128)


TToottaall rreettuurrnn bbeeffoorree ddiissttrriibbuuttiioonnss (8,965) 224


CChhaannggee iinn nneett aasssseettss aattttrriibbuuttaabbllee ttoo sshhaarreehhoollddeerrss (9,351) (300)



££''000000 ££''000000 ££''000000 ££''000000




Less: Amounts payable on cancellation of shares (565) (32,529)

4,017 9,100

Dilution levy 5 12

Change in net assets attributable to shareholders (9,351) (300)



The above statement shows the comparative closing net assets at 30 September 2007 whereas the current accounting period commenced1 April 2008.



££''000000 ££''000000 ££''000000 ££''000000

AAsssseettss::

PPoorrttffoolliioo ooff iinnvveessttmmeennttss 67,602 72,286

Debtors 6 340 622


TToottaall ootthheerr aasssseettss 2,081 2,586




Creditors 7 (668) (924)

Total other liabilities (668) (924)

Total liabilities (668) (924)


* last audited figures







40


Holding or Value Total Net Nominal Value £'000 Assets BBeerrmmuuddaa ((00..9911%%)) 440011 00..5588IInndduussttrriiaallss ((00..2211%%)) 00 00..0000CCoonnssuummeerr GGooooddss ((00..7700%%)) 440011 00..5588

12,057 Bunge 401 0.58

CCaayymmaann IIssllaannddss ((11..5544%%)) 11,,003355 11..5500FFiinnaanncciiaallss ((00..5511%%)) 444433 00..6644

54,505 XL Capital 443 0.64

TTeecchhnnoollooggyy ((11..0033%%)) 559922 00..8866

91,700 Seagate Technology 592 0.86

UUnniitteedd SSttaatteess ((9955..3300%%)) 6666,,116666 9955..8877BBaassiicc MMaatteerriiaallss ((66..2288%%)) 33,,009999 44..4499

6,966 AK Steel 90 0.13 4,800 DuPont de Nemours 105 0.15 6,600 Freeport McMoran C&G Class 'B' 194 0.29 3,900 Innophos 49 0.07

11,600 International Paper 168 0.24 43,262 Kapstone Paper 143 0.21 14,500 Monsanto 779 1.13 16,000 Mosaic 565 0.82 6,937 North American Galvanizing & Coating 19 0.03 9,600 Nucor 196 0.28

13,000 Praxair 506 0.73 7,700 Terra Industries 113 0.16 4,300 United States Steel 172 0.25

CCoonnssuummeerr GGooooddss ((55..4433%%)) 66,,662277 99..6600

65,800 Activision Blizzard 512 0.74 5,000 Alliance One International 10 0.01

43,990 Altria 471 0.68 2,800 American Italian Pasta Class 'A' 25 0.04

27,200 Autoliv 510 0.74 5,800 Cal Maine 85 0.12

28,850 Coach 380 0.55 12,500 Exide Technologies 46 0.07 40,100 Foot Locker 355 0.51 3,500 Molson Coors Brewing 87 0.13 9,900 Parlux Fragrances 28 0.04

36,180 Philip Morris 937 1.36 55,681 Procter & Gamble 2,056 2.98

9,000 Pulte Homes 69 0.10 8,500 Quiksilver 26 0.04 4,500 Ralcorp 164 0.24 3,110 Snap-on 88 0.13

33,612 Unifi 88 0.13 1,900 Universal 51 0.07 2,800 V F 119 0.17

25,400 Weightwatchers International 520 0.75

CCoonnssuummeerr SSeerrvviicceess ((1100..7777%%)) 88,,118800 1111..8855

3,700 Aaron Rents 55 0.08 3,500 Advance Auto Parts 75 0.11 3,111 America's Car-Mart 30 0.04

38,213 Blockbuster 23 0.03 2,800 Buckle 88 0.13

13,200 Comcast 132 0.19 58,010 CVS 1,048 1.52 14,900 Delta Airlines 60 0.09

6,000 Denny's 8 0.01 4,400 Directv 58 0.08

13,000 Dress Barn 108 0.16




Bid-Market Percentage of Holding or Value Total Net Nominal Value £'000 Assets UUnniitteedd SSttaatteess ((ccoonnttiinnuueedd))CCoonnssuummeerr SSeerrvviicceess ((ccoonnttiinnuueedd))

52,500 eBay 580 0.84 28,000 Finish Line Class 'A' 151 0.22

5,090 Gamestop 96 0.14 22,600 Hawaiian Class 'A' 112 0.16

3,500 Kohls 88 0.13 8,900 Krispy Kreme Doughnuts 16 0.02

52,080 Kroger 773 1.12 19,285 Liberty Media 128 0.19 12,800 Lowe's 162 0.23 29,950 McDonald's 997 1.44 35,000 MGM Mirage 501 0.73 14,300 Polo Ralph Lauren 521 0.75

4,491 Rent a Center 56 0.08 53,100 Staples 642 0.93 23,375 UAL 107 0.16 37,700 Walgreen 647 0.94 18,000 Wal-Mart Stores 582 0.84

8,470 Walt Disney 139 0.20 7,852 Warnaco 197 0.29

FFiinnaanncciiaallss ((1166..3355%%)) 1111,,885511 1177..1188

3,200 Ace (US line) 94 0.14 28,877 Advanta Class 'B' 120 0.17 19,000 American Express 342 0.50

2,400 Arch Capital 96 0.14 21,800 Bank of America 365 0.53

8,500 CME 1,505 2.18 5,500 Discover 41 0.06 9,900 Goldman Sachs 661 0.96

22,200 Interactive Broker 260 0.38 19,100 Intercontinental Exchange 686 0.99 11,500 Invesco 132 0.19 25,400 JP Morgan Chase 576 0.83 14,540 Knight Capital 119 0.17 8,000 Life Partners 153 0.22

15,700 Marsh & McLennan 269 0.39 12,400 Marshall & Ilsley 124 0.18 14,300 Mastercard 1,330 1.93 11,184 MGIC 41 0.06 15,100 Morgan Stanley 175 0.25 15,800 Nasdaq OMX 254 0.37 10,500 National Penn Bancshares 83 0.12 34,120 New York Community 286 0.41

6,050 Oriental 60 0.09 500 Parkvale 4 0.01

34,700 PMI 61 0.09 41,092 PRG-Schultz 193 0.28 4,634 RAIT 14 0.02

12,374 Republic Bancorp Class 'A' 194 0.28 26,430 State Street 644 0.93 13,800 Suntrust Banks 295 0.43 47,300 Travellers 943 1.37 13,970 Unum 186 0.27 28,900 Visa 924 1.34 4,100 Wells Fargo 75 0.11

29,500 Western Union (The) 385 0.56 8,500 Zions Bancorp 161 0.23




42

Bid-Market Percentage of Holding or Value Total Net Nominal Value £'000 Assets UUnniitteedd SSttaatteess ((ccoonnttiinnuueedd))HHeeaalltthhccaarree ((1144..5544%%)) 1100,,225588 1144..8866

1,900 Aetna 37 0.04 54,850 Allergan 1,552 2.25

8,500 Amgen 261 0.38 15,100 Boston Scientific 99 0.14 23,500 Celgene 728 1.06 68,600 Depomed 129 0.19 8,964 Fresh Del Monte 114 0.17

25,000 Genentech 1,180 1.71 32,700 Gilead Sciences 768 1.11 17,700 Invitrogen 368 0.53 38,700 Johnson & Johnson 1,432 2.08

1,100 Life Sciences Research 22 0.03 11,100 Lifepoint Hospitals 196 0.28 15,300 Lily (Eli) 371 0.54

156,260 Pfizer 1,526 2.21 6,000 St. Jude Medical 138 0.20

22,000 Stryker 747 1.08 38,500 United Health 445 0.65 5,900 Wellpoint 145 0.21

IInndduussttrriiaallss ((66..9933%%)) 44,,778877 66..9944

47,700 ABB ADR (each representing one share) 474 0.69 13,400 Allied Waste 80 0.12

1,118 Argan 9 0.01 600 Baker (Michael) 10 0.01

5,700 CNH Global 62 0.09 4,800 Crown 56 0.08 3,500 Cummins 81 0.12

56,000 Expeditors International of Washington 1,083 1.57 1,598 Foster (LB) Class 'A' 26 0.04

18,100 Graftech International 134 0.19 14,500 Griffon 70 0.10

412 NCI Building Systems 7 0.01 3,050 NN 20 0.03 2,200 Norfolk Southern 80 0.12 5,700 Northrop Grumman 194 0.28

16,700 Parker-Hannifin 462 0.67 9,600 Precision Castparts 413 0.60 2,800 Ryder System 90 0.13 3,800 SPX 144 0.21 1,000 Tecumseh 13 0.02 6,310 Terex 102 0.15 4,600 TTM 25 0.04 7,700 Tyco Electronics 107 0.15 1,100 Unifirst 27 0.04 3,500 Union Pacific 134 0.19

19,400 United Parcel Service Class 'B' 682 0.99 4,600 United Rentals 40 0.06 6,950 Walter 162 0.23

MMeeddiiaa ((00..7722%%)) 00 00..0000OOiill aanndd GGaass ((1111..8844%%)) 77,,000066 1100..1155

300 Anadarko Petroleum 7 0.01 2,700 Apache 148 0.21

24,000 ChevronTexaco 1,029 1.49 400 Clayton Williams Energy 15 0.02

36,200 ConocoPhillips 1,388 2.01 12,300 EOG Resources 577 0.84 38,270 Exxon Mobil 1,568 2.27 12,200 FMC Technologies 291 0.42

3,700 Hess 156 0.23 19,800 National Oilwell 500 0.72

7,200 Noble 164 0.24






Bid-Market Percentage of Holding or Value Total Net Nominal Value £'000 Assets UUnniitteedd SSttaatteess ((ccoonnttiinnuueedd))OOiill aanndd GGaass ((ccoonnttiinnuueedd))

3,600 Noble Energy 102 0.15 5,500 Occidental Petroleum 198 0.29

12,350 Schlumberger 504 0.73 7,500 Sunpower 252 0.37 6,000 Vaalco Energy 21 0.03 2,400 Whiting Petroleum 86 0.12

TTeecchhnnoollooggyy ((1177..4422%%)) 1111,,117744 1166..1199

16,000 Adobe Systems 319 0.46 17,700 Amkor 62 0.09 22,300 Apple Computer 1,304 1.89 10,500 Check Point Software 125 0.18 50,100 Cognizant Technology 586 0.85 35,500 Crown Castle International 534 0.77 21,100 Dell 180 0.26 7,150 Google 1,507 2.18

29,700 Hewlett-Packard Finance 732 1.06 10,550 International Business Machines 668 0.97 50,000 Intuit 828 1.20 33,770 Juniper Networks 394 0.57

1,900 Microsoft 26 0.04 22,000 Motorola 81 0.12

5,800 PC Connection 21 0.03 86,980 Qualcomm 1,923 2.79 20,800 Research in Motion 711 1.03 24,400 Telecommunications Systems 90 0.13 44,600 Teradata 454 0.66 6,900 United Online 36 0.05

45,000 Verisign 593 0.86

TTeelleeccoommmmuunniiccaattiioonnss ((22..7744%%)) 11,,993333 22..8800

25,940 America Movil ADR (each representing 20 series 'L' shares) 619 0.90 61,500 AT & T 944 1.37

700 Embarq 16 0.02 4,600 Nii 86 0.12

15,840 Verizon Communications 268 0.39

UUttiilliittiieess ((22..2288%%)) 11,,225511 11..8811

15,110 American Electric Power 307 0.45 1,400 Edison International 30 0.04 3,400 Energen 79 0.11

43,150 Northeast Utilities 607 0.88 6,820 NRG Energy 89 0.13 5,200 Reliant Energy 29 0.04 9,100 Williams 110 0.16


Net other assets 1,413 2.05




44



££''000000 ££''000000Johnson & Johnson 1,393 Exxon Mobil 1,655Procter & Gamble 1,223 ChevronTexaco 825Mastercard 1,054 EMC 772United States Steel 925 Western Digital 770Verisign 803 Annaly 757Autoliv 753 Eastman Chemical 693Exxon Mobil 723 Ensco International 628Morgan Stanley 684 Safeway 610Hewlett-Packard Finance 604 Sunpower 575Freeport McMoran C&G Class 'B' 584 Deere 539CME 568 Zimmer 523Wal-Mart Stores 558 Aetna 522Activision Blizzard 555 BB & T 505McDonald's 519 Research in Motion 498Ford Motor 518 Microsoft 495International Business Machines 494 United States Steel 491FMC Technologies 486 Northern Trust 473Polo Ralph Lauren 447 Lily (Eli) 472Sunpower 443 Wellpoint 470EOG Resources 423 Nucor 453Other purchases for the period 24,823 Other sales for the period 21,107







££''000000 ££''000000


Losses on non-derivative securities (9,398) (214)

NNeett lloosssseess oonn iinnvveessttmmeennttss (9,398) (214)


££''000000 ££''000000

Bank interest 9 31


UK dividends 0 8



££''000000 ££''000000

PPaayyaabbllee ttoo tthhee AAuutthhoorriisseedd CCoorrppoorraattee DDiirreeccttoorr ((AACCDD)),, aassssoocciiaatteess ooff tthhee AACCDD aanndd aaggeennttss ooff eeiitthheerr ooff tthheemm::



61 56



Handling charges taken from capital account (see note 5) 16 (1)


25 11


Audit fees 6 6

6 6








Deferred tax charge for the period (see note 4 (c)) (4) (1)






Effects of:





Franked investment income at 20% 0 (2)










46




££''000000 ££''000000





Interest 0 0




Handling charges taken from the capital account (see note 3) 16 (1)




££''000000 ££''000000






££''000000 ££''000000

















££''000000 ££''000000



Purchase of shares 480 2,438


















3300 SSeepptteemmbbeerr 22000088CCuurrrreennccyy ££''000000 ££''000000 ££''000000US dollar 1,359 67,422 68,781TToottaall 1,359 67,422 68,781

3311 MMaarrcchh 22000088CCuurrrreennccyy ££''000000 ££''000000 ££''000000US dollar 1,402 72,132 73,534TToottaall 1,402 72,132 73,534




((lliiaabbiilliittiieess)) ccaarrrryyiinngg iinntteerreesstt TToottaall3300 SSeepptteemmbbeerr 22000088 ££''000000 ££''000000 ££''000000Sterling 382 (148) 234US dollar 1,359 67,422 68,781TToottaall 1,741 67,274 69,015

3311 MMaarrcchh 22000088Sterling 562 (148) 414US dollar 1,402 72,132 73,534TToottaall 1,964 71,984 73,948












48














ppeennccee ppeerr sshhaarree ppeennccee ppeerr sshhaarree ppeennccee ppeerr sshhaarree ppeennccee ppeerr sshhaarree

RReettaaiill aaccccuummuullaattiioonn CCllaassss 11Group 1 0.0000 - 0.0000 0.0000Group 2 0.0000 0.0000 0.0000 0.0000




*Please see equalisation note in accounting policies









50



IInnvveessttmmeenntt PPoolliiccyyThe investment policy of the Fund is to invest primarily in equities and equity type investments ofcompanies incorporated in the Asian Pacific area or which in the opinion of the Investment Adviser(or sub-adviser), carry on a substantial part of their operations in the Asian Pacific area (excludingJapan). "Equity type investments" will include convertible stocks, stock exchange listed warrants,depositary receipts and any other such investments which entitle the holder to subscribe for orconvert into the equity of the company and/or where the share price performance is, in the opinion of the Investment Adviser (or sub-adviser),influenced significantly by stock market performance of the company's ordinary shares. The Fund may also invest in deposits, money marketinstruments and collective investment schemes.


EEnnvviirroonnmmeennttIn line with many of their global counterparts, Pacific Basin markets initially rallied before retreating sharply over the first half of the period, asinflationary concerns weakened investor confidence. Surging commodity prices began to cause consternation throughout the region. Theseultimately proved beneficial to the Australian market, which fell less severely than other regional markets over the second quarter. Elsewhere,concern over slowing Chinese demand for iron ore negatively affected the Hong Kong market, while Thai stocks were undermined by the potentialrepercussions of anti-government protests.

The sharp falls in Pacific Basin markets continued into the second half of the period, as fears over the health of the global financial systemintensified. Sentiment soured towards economically sensitive stocks on evidence of the decline in Chinese manufacturing output, the Europeaneconomic slowdown and the strength of the US dollar. The increasingly volatile trading environment appeared unreceptive to central bankintervention, as the high-profile collapse of various US and European banks caused confidence in Pacific Basin markets to falter.

AAccttiivviittyyAt the start of the period, the Fund’s managers initiated a position in China Resources Power, which looked set to benefit from China’s need to raisepower prices in order to stimulate further capacity expansion in the sector. Sales included brewer China Resources, on concerns over the impact ofrising input costs on profitability, and GS Engineering, which appeared vulnerable in light of declining Korean housing demand.

During the second half, Singapore-based United Overseas Bank was added on the expectation of an upsurge in its second-quarter profits.Meanwhile, Australian project development firm Leighton Holdings was reduced, as weakening company fundamentals caused its share price toretreat.

PPeerrffoorrmmaannccee Over the first three months of the period under review, the Pacific ex Japan Manager of Managers Fund held up well in difficult market conditions.Some investors viewed Asian markets with caution, believing them to be more vulnerable to the effects of rising commodities and inflationarypressures. The industrial sector suffered from such investor sentiment, falling sharply, while the consumer discretionary sector also declined. TheFund’s strong performance was helped by its overweight exposure to the materials sector, where effective stock selection, particularly in Australia,boosted returns.

However, the Fund’s performance fell back during the third quarter of 2008, undermined by positions within the Indonesian and Australianmarkets. Several holdings within the materials and industrials sectors were also weaker. On the upside, the Fund’s holdings in the Philippinesboosted performance, as did strong stock selection within the consumer staples and technology sectors. Meanwhile, an underweight exposure toTaiwan proved beneficial, as the country’s stock market retreated amid slowing export growth and weak domestic consumption.

OOuuttllooookkAs oil and commodity prices trend lower, inflationary pressures across the region have begun to abate.

Coupled with ongoing weakness in domestic economic data, central banks are poised to adopt a more neutral monetary stance.

As recessionary concerns intensify, many companies have a cautious outlook, although few have witnessed a dramatic deterioration in profitability.

Earnings revisions remain subdued in light of a slowing global economy, however, Asian equity markets should gain support from a combination ofrelatively resilient domestic consumption, undervalued currencies, and strong corporate fundamentals.


PPaacciiffiicc BBaassiinn EEqquuiittyy MMaannaaggeerr ooff MMaannaaggeerrss FFuunndd

IInnvveessttmmeenntt SSuubb--AAddvviisseerrssCCllaayy FFiinnllaayy IInncc

PPrriinncciippaall GGlloobbaall IInnvveessttoorrss


BBeenncchhmmaarrkk IMA Asia Pacific (Ex Japan)Sector



££''000000 ppRetail Accumulation 31 March 2006 1,437 945,600 151.97Retail Accumulation 31 March 2007 2,738 1,623,694 168.63Retail Accumulation 31 March 2008 2,702 1,525,356 177.16Retail Accumulation 30 September 2008 1,941 1,405,443 138.11





CCaalleennddaarr DDiissttrriibbuuttiioonn HHiigghheesstt LLoowweessttSShhaarree CCllaassss yyeeaarr ppeerr sshhaarree pprriiccee pprriiccee






TToottaall EExxppeennssee RRaattiioo ((TTEERR))

RReettaaiill IInnssttiittuuttiioonnaall SSttaannddaarrdd LLiiffee PPeennssiioonn AAss aatt sshhaarree ccllaassss sshhaarree ccllaassss sshhaarree ccllaassss sshhaarree ccllaassss31 March 2007 2.09% 1.08% 0.06% n/a31 March 2008 2.10% 1.10% 0.10% 0.07%30 September 2008 2.08% 1.08% 0.08% 0.06%


SSttaannddaarrdd LLiiffee PPaacciiffiicc BBaassiinn EEqquuiittyy MMaannaaggeerr ooff MMaannaaggeerrss FFuunnddPPaacciiffiicc BBaassiinn EEqquuiittyy MMaannaaggeerr ooff MMaannaaggeerrss FFuunndd



52



££''000000 ££''000000 ££''000000 ££''000000



Income 2 777 566


Finance costs: interest 5 0 (3)


Taxation 4 (141) (108)


TToottaall rreettuurrnn bbeeffoorree ddiissttrriibbuuttiioonnss (8,663) 6,405





££''000000 ££''000000 ££''000000 ££''000000





2,236 3,630

Dilution levy 31 25







££''000000 ££''000000 ££''000000 ££''000000

AAsssseettss::


Debtors 6 187 546

Cash and bank balances 711 889

TToottaall ootthheerr aasssseettss 898 1,435



Creditors 7 (363) (792)

TToottaall ootthheerr lliiaabbiilliittiieess (363) (792)

TToottaall lliiaabbiilliittiieess (363) (792)










Holding or Value Total Net Nominal Value £'000 Assets AAuussttrraalliiaa ((2244..0044%%)) 99,,002255 2288..1122

12,208 Ansell 68 0.21 11,021 Ausenico 55 0.17 25,754 Australia & New Zealand Bank 212 0.66

118,331 BHP Billiton 1,632 5.08 14,714 Billabong International 88 0.27 29,920 Boral 81 0.25 14,219 Bradken 54 0.17 85,835 Centennial Coal 141 0.44

101,200 Coca-Cola Amatil 372 1.16 6,850 Cochlear 175 0.55

36,744 Commonwealth Bank of Australia 697 2.17 36,545 CSL 605 1.88 8,063 Felix Resources 61 0.19 7,915 Flight Centre 65 0.20

21,925 Fortescue Metals 45 0.14 114,000 Incitec Pivot 257 0.80

14,637 JB Hi-Fi 79 0.25 23,200 Leighton 388 1.21 14,644 Macquarie 240 0.75

124,643 Monadelphous 90 0.28 21,056 National Australian Bank 227 0.71 31,572 Nufarm 211 0.66 25,485 OneSteel 52 0.16 48,709 QBE Insurance 568 1.77 14,996 Rio Tinto 564 1.76 11,090 St George Bank 141 0.44 92,032 Telstra 171 0.53 5,666 Wesfarmers 71 0.22

53,224 Westpac Banking 509 1.59 10,993 Woodside Petroleum 249 0.78 47,706 Woolworths 578 1.80 20,700 WorleyParsons 279 0.87

CChhiinnaa ((00..1144%%)) 11,,779966 55..6600

1,608,000 China Construction Bank 577 1.80 111,000 China Cosco 'H' Shares 54 0.17

1,030,000 China Everbright International 93 0.29 401,485 China South Locomotive and Rolling 84 0.26

2,381,000 Industrial and Commercial Bank of China 775 2.42 1,083,000 Want Want China 213 0.66

HHoonngg KKoonngg ((2233..5544%%)) 77,,005599 2211..9999

98,000 Anhui Conch Cement 'H' Shares 202 0.63 28,500 ASM Pacific Technology 90 0.28

537,000 Bank Of China 112 0.35 234,920 BOC Hong Kong 227 0.71

97,010 Cheung Kong 596 1.86 55,000 Cheung Kong Infrastructure 140 0.44

161,000 China Life Insurance 327 1.02 147,060 China Mobile (Hong Kong) 805 2.51

74,000 China Netcom (Hong Kong) 91 0.28 342,000 China Overseas Land & Investment 223 0.69 140,000 China Pharma 25 0.08 202,000 China Resources Enterprise 237 0.74 126,000 China Yurun Food 90 0.28 959,210 CNOOC 604 1.88 300,000 Denway Motors 51 0.16 136,000 Hang Lung Properties 173 0.54

14,720 Hang Seng Bank 151 0.47 41,000 Henderson Land Development 99 0.31

232,000 Hengan International 360 1.12 51,500 Hong Kong Electric 178 0.55

140,000 Hutchison Telecommunications 88 0.27 46,230 Hutchison Whampoa 194 0.60 59,000 Hysan Development 84 0.26

119,000 Jiangxi Copper 'H' Shares 64 0.20 572,000 Kingdee International Software 60 0.19




54

Bid-Market Percentage of Holding or Value Total Net Nominal Value £'000 Assets HHoonngg KKoonngg ((ccoonnttiinnuueedd))

106,000 Li & Fung 140 0.43 95,220 Pacific Basin Shipping 43 0.13

396,000 PCCW 90 0.28 248,000 Peace Mark 27 0.08 416,180 PetroChina 'H' Shares 237 0.74

28,500 Ping An Insurance 'H' Shares 89 0.28 205,000 Shanghai Industrial 256 0.80 370,000 Shougang Concord International Enterprises 29 0.09 282,000 Sinopec 121 0.38

16,000 Sun Hung Kai Properties 89 0.28 85,000 Swire Pacific 408 1.27 31,000 Tencent 122 0.38 98,000 Texwinca 44 0.14 60,000 Wharf 93 0.29

IInnddiiaa ((00..0000%%)) 226622 00..8822

4,761 Larsen & Toubro GDR (each representing 1 ordinary share) 133 0.42 21,177 Mahindra & Mahindra GDR (each representing 1 ordinary share) 129 0.40

IInnddoonneessiiaa ((33..1111%%)) 663388 11..9999

928,000 Bumi Resources 173 0.54 569,500 Indofoods Sukses Makmur 65 0.20 101,500 Tambang Batubara 55 0.17 624,636 United Tractors 345 1.08

MMaallaayyssiiaa ((22..8800%%)) 229988 00..9933

23,700 DIGI.com 85 0.27 255,200 KLCC properties 110 0.34

59,100 Kulim (Malaysia) 52 0.16 47,300 Tenaga Nasional 51 0.16

PPhhiilliippppiinneess ((11..1155%%)) -- -- SSiinnggaappoorree ((66..1100%%)) 22,,221100 66..8899

27,000 Capitaland 32 0.10 246,000 Capitamall Trust 214 0.67 183,000 China Fishery (Singapore line) 69 0.21

69,000 DBS 448 1.40 107,400 Noble 55 0.17 220,000 Olam 152 0.47 221,000 Sembcorp Marine 256 0.80

29,133 Singapore Airlines 160 0.50 469,000 Singapore Telecommunications 590 1.84

36,000 United Overseas Bank 234 0.73

SSoouutthh KKoorreeaa ((1122..1122%%)) 44,,226622 1133..2288

17,970 Daegu Bank 86 0.27 17,310 Daesang 63 0.20

8,690 Dongbu Insurance 105 0.33 2,680 Dongkuk Steel Mill 44 0.14

583 Hite Brewery 58 0.18 3,174 Hyundai Mobis 134 0.42 3,850 Hyundai Motor 130 0.41

18,783 Kookmin Bank 469 1.46 3,088 Korea Gas 97 0.30 1,023 Korea Zinc 44 0.14 3,347 KT&G 138 0.43 7,810 LG 75 0.23 1,790 LG Electronics 88 0.28 2,413 LG Engineering & Construction 103 0.32

206 Lotte Confectionery 97 0.30 6,053 NHN 416 1.30 3,157 Posco 639 1.99

12,570 S&T Dynamics 68 0.21 2,725 Samsung Electronics 673 2.10

17,500 Samsung Heavy 248 0.77 6,412 Shinhan Financial 123 0.38 1,662 SK Energy 68 0.21




Bid-Market Percentage of Holding or Value Total Net Nominal Value £'000 Assets SSoouutthh KKoorreeaa ((ccoonnttiinnuueedd))

4,080 Stx Engine 43 0.13 9,419 Sun Kwang Bend 91 0.28 8,569 Tong Yang Investment Bank 33 0.10

14,820 Woori Finance 80 0.25 11,890 Youngone 49 0.15

TTaaiiwwaann ((88..4422%%)) 22,,226622 77..0055

98,055 Advantech 90 0.28 77,000 Chicony Electronics 64 0.20

298,530 China Life Insurance 71 0.22 1 Chroma Ate 0 0.00

165,000 Chunghwa Telecom 211 0.66 405,440 Far East Textile 154 0.48 116,000 Farglory Land Development 62 0.19

58 First Financial 0 0.00 214,000 Fubon Financial (Macquarie Bank Certificate Warrants 11/8/2008) 83 0.26

41,000 Great Wall Enterprise 20 0.06 20,800 High Tech Computer 174 0.54 70,840 Hon Hai Precision Industry 136 0.42

220,320 Hua Nan Financial Twd10 73 0.23 33,000 MediaTek 184 0.57

155,210 Powertech Technology 184 0.57 8,000 President Chain 13 0.04

119,000 Quanta Computer 80 0.25 25,000 Richtek Technology 73 0.23

148,000 Taiwan Mobile 130 0.41 381,213 Taiwan Semiconductor Manufacturing 344 1.07 125,000 Taiwan Synthetic Rubber 73 0.23

56,000 U-Ming Marine Transport 43 0.14

TThhaaiillaanndd ((44..5511%%)) 11,,221188 33..7799

45,600 Advanced Information Services 60 0.19 628,300 Asian Property Development (Alien Market) 50 0.15 185,300 Bangkok Bank (Alien Market) 309 0.96

10,500 Banpu (Alien Market) 51 0.16 1,427,000 C.P. Seven Eleven 252 0.79

245,000 Kasikornbank non voting depository receipt (each representing 1 ordinary share) 248 0.77 64,000 PTT Chemical (Alien Market) 60 0.19

1,375,100 Quality Houses (Alien Market) 39 0.12 43,800 Siam Commercial Bank 49 0.15 40,500 Siam Commercial Bank (Alien Market) 45 0.14

635,000 Thai Beverage 55 0.17

UUnniitteedd SSttaatteess ooff AAmmeerriiccaa ((99..3300%%)) 11,,886666 55..8811

169,787 Boart Longyear (AU Line) 84 0.26 4,639 HDFC Bank ADS (each representing 3 ordinary shares) 194 0.60 8,360 Infosys Technologies sponsored ADR (each representing 1 share) 134 0.42

13,200 Jardine Matheson 190 0.59 4,466 Netease ADR (each representing 25 common stock) 50 0.16

11,968 Reliance Industries GDR (each representing 2 ordinary shares) 546 1.70 15,105 Satyam Computer Services ADS (each representing 2 ordinary shares) 123 0.38 10,752 SK Telekom ADR (each representing 1/90 of share) 111 0.35 90,152 Taiwan Semiconductor Manufacturing ADS (each convertible into 5 ordinary shares) 434 1.35

UUnniitteedd SSttaatteess DDoollllaarr DDeerriivvaattiivveess ((33..1100%%)) 666622 22..0066

479,000 JP Morgan International Derivatives Call Warrants 7/10/2008 (ChinaTrust Financial) 141 0.44 56,350 JP Morgan International Derivatives Call Warrants 19/10/2010 (Bharti Airtel) 521 1.62




All investments are listed on recognised stock exchanges and are "approved securities" within the meaning of the FSA Rules unless otherwise stated.

The figures in brackets show the comparative percentage holdings as at 31 March 2008.




56



££''000000 ££''000000China Construction Bank 683 China Mobile (Hong Kong) 503Commonwealth Bank of Australia 558 LG Chemical 481Samsung Electronics 503 Samsung Electronics 480Samsung Heavy 486 Hon Hai Precision Industry 378Swire Pacific 483 Sime Darby 336NHN 475 Westpac Banking 319Bumi Resources 401 LG Engineering & Construction 310Anhui Conch Cement 'H' Shares 384 Jiangsu Expressway 'H' Shares 310Sime Darby 378 CNOOC 309Kookmin Bank 374 Astra 306Posco 373 Ayala 306Boart Longyear (AU Line) 371 IOI 293Sembcorp Marine 366 Kookmin Bank 290Hengan International 354 Incitec Pivot 285QBE Insurance 336 Commonwealth Bank of Australia 281China Mobile (Hong Kong) 301 AU Optronics 274CNOOC 285 Swire Pacific 273United Tractors 284 Rio Tinto 272High Tech Computer 282 High Tech Computer 254China Resources Enterprise 273 ITC GDR (each representing 1 ordinary share) 253Other purchases for the period 16,882 Other sales for the period 15,441




SSuummmmaarryy ooff PPoorrttffoolliioo CChhaannggeess


11 NNeett ((lloosssseess))//ggaaiinnss oonn iinnvveessttmmeennttss dduurriinngg tthhee ppeerriioodd 3300 SSeepptteemmbbeerr 22000088 3300 SSeepptteemmbbeerr 22000077

££''000000 ££''000000

The net (losses)/gains on investments comprise:


NNeett ((lloosssseess))//ggaaiinnss oonn iinnvveessttmmeennttss (9,155) 6,032


££''000000 ££''000000

Bank interest 10 26





££''000000 ££''000000

PPaayyaabbllee ttoo tthhee AAuutthhoorriisseedd CCoorrppoorraattee DDiirreeccttoorr ((AACCDD)),, aassssoocciiaatteess ooff tthhee AACCDD aanndd aaggeennttss ooff eeiitthheerr ooff tthheemm::



35 30





39 12


Audit fees 6 6

6 6







Overseas direct charge 11 7


Deferred tax charge for the period (see note 4 (c)) 5 1






Effects of:


Excess expenses for which no tax relief taken (2) 0

Expense relief for overseas withholding tax 0 (1)



Movement in income accruals not taxable (3) (6)

Non taxable income (Stock dividends) (15) 0

Prior period adjustment 2 0

Stock dividends not subject to corporation tax 0 (3)






58


((cc)) AAnnaallyyssiiss ooff ddeeffeerrrreedd ttaaxxaattiioonn ££''000000 ££''000000


Deferred tax charge for the period (see note 4 (a)) 5 1





££''000000 ££''000000





Interest 0 3








££''000000 ££''000000






££''000000 ££''000000












Standard Life Investments (Mutual Funds) Limited, as Authorised Corporate Director (ACD), is a related party and acts as principal inrespect of all transactions of shares in the Company. The aggregate monies received through issue and paid on cancellation are disclosedin the Statement of Change in Shareholders' Net Assets. Any amounts due to or from Standard Life Investments (Mutual Funds) Limited atthe end of the accounting period are disclosed in notes 6 and 7.

Amounts payable to Standard Life Investments (Mutual Funds) Limited, in respect of periodic charge and registration services are disclosedin note 3 and the amounts due at the period end are disclosed in note 7.



££''000000 ££''000000





















3300 SSeepptteemmbbeerr 22000088CCuurrrreennccyy ££''000000 ££''000000 ££''000000Australian dollar 9 9,182 9,191Chinese yuan renminbi 0 4 4Hong Kong dollar 16 8,861 8,877Indonesian rupiah 0 638 638Israeli shekel 0 4 4Korean won 0 4,277 4,277Malaysian ringgit 0 298 298Singapore dollar 2 2,267 2,269Taiwan dollar 84 2,279 2,363Thailand baht 1 1,160 1,161US dollar 173 2,707 2,880TToottaall 285 31,677 31,962

3311 MMaarrcchh 22000088CCuurrrreennccyy ££''000000 ££''000000 ££''000000Australian dollar 0 9,443 9,443Chinese yuan renminbi 0 54 54Hong Kong dollar 153 8,719 8,872Indonesian rupiah 0 1,197 1,197Malaysian ringgit 52 1,129 1,181Philippine peso 0 445 445Singapore dollar 0 2,239 2,239South Korean won 0 4,755 4,755Taiwan dollar 232 3,235 3,467Thailand baht 0 1,740 1,740US dollar 90 4,779 4,869TToottaall 527 37,735 38,262




60





((lliiaabbiilliittiieess)) ccaarrrryyiinngg iinntteerreesstt TToottaall3300 SSeepptteemmbbeerr 22000088 ££''000000 ££''000000 ££''000000Australian dollar 9 9,182 9,191Chinese yuan renminbi 0 4 4Hong Kong dollar 16 8,861 8,877Indonesian rupiah 0 638 638Israeli shekel 0 4 4Korean won 0 4,277 4,277Malaysian ringgit 0 298 298Singapore dollar 2 2,267 2,269Sterling 426 (295) 131Taiwan dollar 84 2,279 2,363Thailand baht 1 1,160 1,161US dollar 173 2,707 2,880TToottaall 711 31,382 32,093

3311 MMaarrcchh 22000088 ££''000000 ££''000000 ££''000000Australian dollar 0 9,443 9,443Chinese yuan renminbi 0 54 54Hong Kong dollar 153 8,719 8,872Indonesian rupiah 0 1,197 1,197Malaysian ringgit 52 1,129 1,181Philippine peso 0 445 445Singapore dollar 0 2,239 2,239South Korean won 0 4,755 4,755Sterling 364 (159) 205Taiwan dollar 232 3,235 3,467Thailand baht 0 1,740 1,740US dollar 90 4,779 4,869TToottaall 891 37,576 38,467

















1122 CCoonnttiinnggeenntt lliiaabbiilliittiieessThe sub-fund had no contingent liabilities at the balance sheet date (31 March 2008 - £nil).




62


















IInnvveessttmmeenntt OObbjjeeccttiivveeThe investment objective of the Fund is to provide a total return from both capital appreciation andincome.

IInnvveessttmmeenntt PPoolliiccyyThe investment policy of the Fund is to invest primarily in Government and other bonds issued inthe currency of the UK. The Fund may also invest in transferable securities, deposits, money marketinstruments and collective investment schemes.


EEnnvviirroonnmmeennttBond market participants viewed the bailout of investment bank Bear Stearns in mid-March as a turning point, sparking a rally in credit marketsthat continued throughout April and May. High-yield bonds registered their best monthly returns for five years in April, reversing the flight toquality witnessed at the start of the year. Although the MPC and FOMC both lowered rates by 0.25% in April, rates remained on hold for theremainder of the period as burgeoning inflationary pressures dampened expectations of further policy easing. The return of risk aversion towardsthe end of the second quarter weighed heavily on credit markets, particularly affecting high-yield returns.

Moving into the third quarter of 2008, global government bond markets enjoyed positive returns, as the deteriorating economic backdropprompted a flight to quality. Although interest rates were raised in Europe, they remained on hold in the UK and US, as the severity of theeconomic slowdown tipped the balance away from inflation towards slowing growth. Conditions in the corporate bond market deteriorated, asglobal recession fears gained credence amid weak economic news. In addition, a stream of negative news from the financial sector alsoundermined the credit market.

AAccttiivviittyyPoor liquidity led to limited trading over the period. However, the Fund’s managers purchased bonds in financial services firm CIT Group, on thebelief that the market had under-appreciated the potential of its lending franchise.

During August, the Fund’s managers took profits on holdings of medium-dated gilts that rallied over the period. In addition, exposure wasincreased to longer-dated gilts that had become attractive from a valuation perspective. Towards the end of the period, extremely unfavourablepricing and a lack of market activity further capped trading. Despite this, the Fund’s managers participated in several new issues, including HSBC,RBS and Imperial Tobacco. In addition, exposure was reduced to relatively expensive medium-dated bonds and increased to ultra long and short-dated bonds which are more attractively valued.

PPeerrffoorrmmaanncceeCorporate bonds recorded strong gains at the start of the period, as investors were enticed back into the market by the attractive yields available.However, as concerns over the financial system and the wider economy intensified, investors became increasingly risk averse. While this trend had anegative impact on returns at the end of the quarter, the Fund’s overall asset allocation positioning, which favoured credit over gilts, was positivefor performance.

The Fund underperformed its benchmark over the period. Stock selection within UK government bonds was positive due to a bias to longer-datedbonds, while holdings in general financial companies such as AMP, GE Capital, and CIT Group also had a positive impact on returns. However, theFund was negatively impacted by holding Lehman Brothers and Bradford and Bingley bonds. An overweight position in corporate bonds alsodetracted from overall performance as investors turned away from risk assets in search of higher rated investments.

OOuuttllooookkBond markets have benefited considerably from the sense of crisis across the globe, and have priced in significant rate cuts in all major economies.While the severity of recent events will encourage large rate cuts, the frequency of failures within the financial sector may be unsustainable. Whensome calm begins to descend on the sector, the eventual cost of government actions will need to be assessed by bond markets. This will inevitablyincrease the level of supply issued into the market, and could be a drag on bond prices. Nevertheless, the protracted nature of the currenteconomic downturn should encourage greater investment in the safety of government bonds.


UUKK BBoonndd MMaannaaggeerr ooff MMaannaaggeerrss FFuunndd

IInnvveessttmmeenntt SSuubb--AAddvviisseerrssBBaaiilllliiee GGiiffffoorrdd OOvveerrsseeaass LLiimmiitteedd

RRooyyaall LLoonnddoonn AAsssseett MMaannaaggeemmeenntt LLiimmiitteedd


BBeenncchhmmaarrkk 50% IMA UK Gilt+ 50% IMA Corp Bond Sectors


64









* To 30 September 2008**From the launch of the Fund on 20 February 2004 to 31 December 2004

TToottaall EExxppeennssee RRaattiioo ((TTEERR))RReettaaiill IInnssttiittuuttiioonnaall SSttaannddaarrdd LLiiffee

AAss aatt sshhaarree ccllaassss sshhaarree ccllaassss sshhaarree ccllaassss31 March 2007 1.43% 1.03% 0.03%31 March 2008 1.50% 1.10% 0.10%30 September 2008 1.47% 1.07% 0.07%







££''000000 ££''000000 ££''000000 ££''000000



Income 2 1,639 1,545


Finance costs: interest 5 (11) (10)


Taxation 4 0 (1)


TToottaall rreettuurrnn bbeeffoorree ddiissttrriibbuuttiioonnss (1,859) 134





££''000000 ££''000000 ££''000000 ££''000000





(249) 236







££''000000 ££''000000 ££''000000 ££''000000

AAsssseettss::


Debtors 6 1,523 3,448

Cash and bank balances 3,011 705

TToottaall ootthheerr aasssseettss 4,534 4,153




Creditors 7 (1,470) (1,203)

Bank overdraft (1,317) 0

TToottaall ootthheerr lliiaabbiilliittiieess (2,787) (1,203)

TToottaall lliiaabbiilliittiieess (2,787) (1,246)









66


Holding or Value Total Net Nominal Value £'000 Assets UUnniitteedd KKiinnggddoomm ((9911..7722%%)) 5500,,110044 9933..5577 UUnniitteedd KKiinnggddoomm DDeennoommiinnaatteedd DDeebbtt SSeeccuurriittiieess ((9911..7722%%)) 5500,,110044 9933..5577 UUnniitteedd KKiinnggddoomm GGoovveerrnnmmeenntt BBoonnddss ((3333..7711%%)) 2200,,882299 3388..9900

£530,000 Treasury 4.25% Gilt 2049 504 0.94 £1,886,666 Treasury 4.25% Stock 2032 1,789 3.34 £1,514,992 Treasury 4.25% Stock 2036 1,452 2.71

£985,000 Treasury 4.25% Stock 2046 940 1.76 £452,160 Treasury 4.25% Stock 2055 441 0.82 £220,000 Treasury 4.5% Stock 2019 219 0.41

£2,053,000 Treasury 4.75% Stock 2010 2,079 3.88 £500,000 Treasury 4.75% Stock 2015 514 0.96 £300,000 Treasury 4.75% Stock 2020 305 0.57

£1,520,000 Treasury 4.75% Stock 2038 1,591 2.97 £1,138,189 Treasury 5% Stock 2012 1,172 2.19

£150,000 Treasury 5% Stock 2018 157 0.29 £890,000 Treasury 5% Stock 2025 923 1.72 £669,000 Treasury 5.25% Stock 2012 695 1.30 £110,000 Treasury 5.75% Stock 2009 112 0.21

£1,598,400 Treasury 6% Stock 2028 1,880 3.51 £2,901,440 Treasury 8% Stock 2013 3,388 6.34

£750,000 Treasury 8% Stock 2015 915 1.71 £327,000 Treasury 8% Stock 2021 433 0.81 £870,000 Treasury 8.75% Stock 2017 1,141 2.13 £235,000 War 3.5% Perpetual 179 0.33

UUnniitteedd KKiinnggddoomm CCoorrppoorraattee BBoonnddss ((5588..0011%%)) 2299,,227755 5544..6677

£500,000 Abbey National 7.125% Perpetual Subordinated Notes 394 0.74 £200,000 AIB 6.271% Floating Rate Notes 29/6/2049 127 0.24 £200,000 AIG 8.625% Floating Rate Notes 22/5/2068 60 0.11 £220,000 Alliance & Leicester 5.25% Medium Term Notes 6/3/2023 177 0.33

£72,000 Alliance & Leicester 5.827% Perpetual Variable Subordinated Notes 54 0.10 £357,000 Alliance & Leicester 6.222% Perpetual Floating Rate Notes 211 0.39 £250,000 AMP (UK) 6.875% Bonds 23/8/2022 246 0.46

£92,000 AMP (UK) 7.125% Floating Rate Notes 6/8/2019 91 0.17 £150,000 Anglian Water Services 7.882% Asset Backed Floating Rate Notes 30/7/2037 159 0.30

£50,000 Anglo American Capital 6.875% Guaranteed Senior European Medium Term Notes 1/5/2018 48 0.09

£455,000 Anglo Irish Capital 6.949% Guaranteed Perpetual Floating Rate Bonds 218 0.41 £250,000 Annington Finance No 1 8% Asset Backed Bonds 2/10/2021 293 0.55 £330,000 Annington Repackaging 5.3236% Bonds 10/1/2023 282 0.53 £480,000 Argon Capital 8.162% Perpetual Floating Rate Medium Term Notes 413 0.77 £139,218 Arsenal Securities 5.1418% Guaranteed Bonds 1/9/2029 114 0.21 £280,000 Aspire Defence Finance 4.674% 'A' Bonds 31/3/2040 172 0.32 £200,000 Aspire Defence Finance 4.674% Asset Backed 'B' Bonds 31/3/2040 125 0.23 £100,000 AT & T 5.5% Bonds 15/3/2027 88 0.16 £100,000 Aviva 5.9021% Perpetual Floating Rate Notes 73 0.14

£50,000 AXA 6.772% Subordinated Perpetual Floating Rate Notes 38 0.07 £200,000 BAA Funding 5.225% Floating Rate Notes Asset-Backed Securities 15/2/2025 151 0.28

£50,000 BAA Lynton10.25% 1st Mortgage Debenture Stock 31/7/2017 69 0.13 £150,000 Bank of America 7% Senior European Medium Term Notes 31/7/2028 153 0.29

£50,000 Bank of East Asia 6.125% Floating Rate Perpetual Medium Term Notes 46 0.09 £100,000 Bank of Ireland 9.25% Floating Rate Medium Term Notes 7/9/2020 100 0.19 £115,000 Bank of Scotland 7.286% Perpetual Bonds 84 0.16 £200,000 Bankers Investment Trust 10.5% Debenture Stock 31/10/2016 272 0.51 £210,000 Barclays Bank 6% Perpetual Subordinated Floating Rate Notes 133 0.25 £490,000 Barclays Bank 6.125% Perpetual Bonds 350 0.65 £220,000 Barclays Bank 6.3688% Perpetual Floating Rate Notes 153 0.29 £100,000 Barclays Bank 6.75% Subordinated Medium Term Floating Rate Notes 16/1/2023 89 0.17 £100,000 Barclays Bank 8.25% Perpetual Floating Rate Medium Term Notes 91 0.17

£50,000 BAT International Finance 5.75% Medium Term Notes 9/12/2013 48 0.09 £100,000 BL Universal 6.75% 1st Mortgage Debenture Stock 31/3/2011 99 0.18

£50,000 Blueorchard Loans 5.586% 25/3/2015 45 0.08 £100,000 BNP Paribas 5.954% Floating Rate Notes Subordinated Perpetual 80 0.15 £450,000 BNP Paribas 5.945% Perpetual Floating Rate Notes 329 0.61




Bid-Market Percentage of Holding or Value Total Net Nominal Value £'000 Assets UUnniitteedd KKiinnggddoomm CCoorrppoorraattee BBoonnddss ((ccoonnttiinnuueedd))

£250,000 BOI Capital Funding No 4 6.4295% Guaranteed Perpetual Floating Rate Notes 159 0.30 £529,000 Bradford & Bingley 5.5% Floating Rate Medium Term Notes 15/1/2018 106 0.20 £478,000 British Land 5.264% Mortgage Backed 24/9/2035 388 0.72 £100,000 British Land 5.375% Mortgage Backed 31/3/2028 84 0.16

£50,000 British Sugar 10.75% Redeemable Debenture Stock 2/7/2013 59 0.11 £100,000 BT 7.5% Variable Bonds 7/12/2016 106 0.20

£50,000 Cattles 7.125% Bonds 5/7/2017 35 0.07 £200,000 Chelsea Building Society 5.875% Floating Rate Subordinated European

Medium Notes 7/3/2019 168 0.31 £200,000 Citigroup 4.5% Subordinated European Medium Term Notes 3/3/2031 118 0.22 £170,000 Citigroup 5.875% Subordinated Notes 1/7/2024 126 0.24 £150,000 Citigroup 6.8% European Medium Term Notes 25/6/2038 136 0.25 £180,000 Citigroup 6.829% Subordinated Guaranteed Floating Rate Notes 28/6/2067 134 0.25 £210,000 Countrywide Financial 5.125% European Medium Term Notes 17/2/2011 192 0.36 £100,000 Coventry Building Society 6.092% Perpetual Floating Rate Notes 78 0.15 £500,000 Credit Agricole SA 5.136% Perpetual Floating Rate Notes 376 0.70

£50,000 Daily Mail & General Trust 6.375% 21/6/2027 34 0.06 £200,000 Dali Capital 4.79924% European Medium Term Notes 21/12/2037 159 0.30 £150,000 Danske Bank 5.563% Perpetual Floating Rate Medium Term Notes 109 0.20 £100,000 Danske Bank 5.6838% Perpetual Floating European Medium Term Notes 73 0.14 £100,000 Delamare Finance 6.067% Bonds 19/2/2029 79 0.15

£75,000 Derbyshire Building Society 6% Floating Rate Notes Permanent Interest Bearing Shares 58 0.11 £250,000 DNB NOR Bank 6.0116% Perpetual Subordinated Floating Rate Notes 194 0.36 £400,000 Dubai Commercial Operations 6% Senior Medium Term Notes 1/2/2017 339 0.63 £100,000 Dunedin Income Growth Investment Trust 7.875% Debenture Stock 30/4/2019 116 0.22

£50,000 Dunfermline Building Society 6% Variable Subordinated Notes 31/3/2015 49 0.09 £180,000 Dwr Cymru Financing 8.174% Floating Rate Notes 31/3/2036 186 0.35 £100,000 E.On International 6% Guaranteed Medium Term Notes 30/10/2019 97 0.18 £135,000 Egg Banking 7.5% Perpetual Variable Medium Term Notes 123 0.23

£50,000 Enel 6.25% Medium Term Notes 20/6/2019 49 0.09 £300,000 Equity Release Funding (No 3) 5.05% Bonds 26/4/2033 261 0.49 £250,000 Equity Release Funding (No.2) 5.88% Bonds 26/5/2032 240 0.45 £150,000 European Investment Bank 4.375% Medium Term Notes 8/7/2015 146 0.27

£70,000 European Investment Bank 4.75% Bonds 15/10/2018 69 0.13 £275,000 European Investment Bank 5% Bonds 15/4/2039 289 0.54

£25,000 European Investment Bank 5.375% Guaranteed Bonds 7/6/2021 26 0.05 £120,000 European Investment Bank 5.5% Bonds 15/4/2025 127 0.24 £327,000 European Investment Bank 5.625% Bonds 7/6/2032 362 0.68 £475,000 European Investment Bank 6% Bonds 7/12/2028 541 1.01

£33,000 European Investment Bank 8.75% Bonds 25/8/2017 42 0.08 £176,148 Finance for Resident Social Housing Variable Notes 4/10/2058 257 0.48 £190,000 Finde Finance 8.125% Floating Rates Notes 14/7/2066 187 0.35 £100,000 Foreign & Colonial Investment Trust 11.25% Debenture Stock 31/12/2014 131 0.24 £150,000 Foreign & Colonial Investment Trust 6.75% Floating Rate Subordinated

Bonds 20/12/2026 103 0.19 £150,000 Friends Provident 6.292% Variable Perpetual Subordinated Notes 109 0.20 £645,000 GE Capital UK Fund 5.125% Guaranteed Senior European Medium

Term Notes 24/5/2023 443 0.83 £100,000 GE Capital UK Funding 6.75% Senior Guaranteed European Medium

Term Notes 6/8/2018 84 0.16 £150,000 General Electric Capital 5.5% Floating Rate Subordinated Bonds 15/6/2066 99 0.18 £265,000 General Electric Capital 6.125% Bonds 17/5/2012 240 0.45 £150,000 General Electric Capital 6.5% Floating Rate Subordinated Bonds 15/9/2067 90 0.17 £260,000 Goldman Sachs 6.125% European Medium Term Notes 14/5/2017 210 0.39 £470,000 Goldman Sachs 6.875% Subordinated Notes 18/1/2038 370 0.69 £100,000 Goldman Sachs 7.25% Notes 10/4/2028 87 0.16

£50,000 Great Portland Estates 5.625% 1st Mortgage Debenture Stock 31/1/2029 44 0.08 £150,000 Grosvenor UK Finance 6.5% Debenture Stock 29/9/2026 155 0.29 £150,000 Hammerson 6% European Medium Term Notes 23/2/2026 106 0.20

£50,000 Hartford Life Institute 5.375% Medium Term Notes 17/1/2012 47 0.09 £300,000 HBOS 6.0884% Perpetual Floating Rate Notes 198 0.37 £500,000 HBOS 6.3673% Perpetual Floating Rate Notes 306 0.57

£50,000 HBOS Capital Funding 9.54% Perpetual Floating Rate Notes 42 0.08 £340,000 Henderson 6.5% Bonds 2/5/2012 351 0.66 £520,000 Household Finance 7% European Medium Term Notes 27/3/2012 520 0.97 £220,000 HSBC 5.75% Medium Term Notes 20/12/2027 181 0.34 £100,000 HSBC 6.375%- Medium Term Notes 18/10/2022 93 0.17 £100,000 HSBC 6.75% Subordinated Medium Term Notes 11/9/2028 94 0.18




68


£50,000 Hutchison Ports Finance 6.75% Bonds 7/12/2015 50 0.09 £349,000 HVB Funding Trust II 7.76% Bonds 13/10/2036 238 0.44

£50,000 Imperial Tobacco Finance 5.5% Medium Term Notes 22/11/2016 43 0.08 £50,000 Imperial Tobacco Finance 8.125% Medium Term Notes 15/3/2024 49 0.09

£100,000 ING Bank 6.875% Subordinated Medium Rate Notes 29/05/2023 90 0.17 £230,000 ING 5.14% Perpetual Floating Rate Notes 171 0.32 £100,000 Insurance Australia 5.625% Subordinated Floating Rate Notes 21/12/2026 76 0.14 £240,000 International Bank for Reconstruction & Development 5.375% Bonds 15/1/2014 248 0.46

£20,000 International Bank for Reconstruction & Development 5.4% Medium Term Notes 7/6/2021 21 0.04

£140,000 International Bank for Reconstruction & Development 5.75% Medium Term Notes 7/6/2032 157 0.29

£100,000 Investec Finance 6.25% Subordinated European Floating Rate Notes 48 0.09 £200,000 Iridal 5% Medium Term Notes 7/3/2035 163 0.30

£50,000 ITV 6.125% Bonds 5/1/2017 42 0.08 £100,000 JP Morgan Chase 6.125% Subordinated Floating Rate European

Medium Term Notes 30/5/2017 91 0.17 £150,000 Juneau Invectments 5.9% European Medium Term Notes 22/2/2021 140 0.26 £100,000 Kent Reliance Building Society 6.591% Permanent Interest Bearing Shares 89 0.17

£50,000 Koninklijke 5.75% Medium Term Notes 18/3/2016 46 0.09 £150,000 Land Securities Capital Markets 5.125% Floating Rate Senior European

Medium Term Notes 7/2/2036 115 0.21 £50,000 Leeds Building Society 5.75% Variable Subordinated European Medium

Term Notes 9/3/2015 48 0.09 £100,000 Lehman Brothers 6% Senior European Medium Term Notes 25/1/2013* 13 0.02 £100,000 Lehman Brothers 7.875% Medium Term Notes 08/5/2018* 12 0.02

£70,000 Lloyds TSB 10.625% Subordinated Loan Stock 21/10/2008 70 0.13 £430,000 Lloyds TSB Capital 7.834% Non Cumulative Perpetual Preferred Securities 381 0.71 £200,000 London Stock Exchange 5.875% 7/7/2016 183 0.34 £410,000 Lunar Funding 5.75% European Medium Term Notes 18/11/2038 368 0.69 £100,000 Lunar Funding 6.125% European Medium Term Notes 9/6/2027 93 0.17

£50,000 Marks & Spencer Finance 5.625% Medium Term Notes 24/3/2014 43 0.08 £150,000 Mellon Capital III 6.369% Guaranteed Subordinated Floating Rate Notes 5/9/2066 112 0.21 £243,000 Merrill Lynch 5.5% European Medium Term Notes 22/11/2021 161 0.30 £100,000 Metropolitan Life Global Funding 1 5.25% European Medium Term Notes 9/1/2014 93 0.17 £100,000 Monks Investment Trust 11% Debenture Stock 1/6/2012 121 0.23 £106,000 Morgan Stanley 5.125% Medium Term Notes 30/11/2015 74 0.14 £150,000 MUFG Capital Finance 5 6.299% Perpetual Floating Rate Notes 110 0.21 £100,000 National Australia Bank 7.125% Floating Rate Note 12/6/2023 94 0.18 £100,000 National Bank of Greece Funding (NBOG) 6.2889% - Floating Rate Notes

Guaranteed Perpetual 69 0.13 £50,000 National Grid 5.5% Senior European Medium Term Notes 24/7/2013 48 0.09

£150,000 Nationwide Building Society 6.024% Perpetual Subordinated Floating Rate Notes 126 0.24 £100,000 Nordea Bank Finland 6.25% Perpetual Subordinated European Medium Term Notes 87 0.16 £100,000 Northern Ireland Electricity 6.875% Bonds 18/9/2018 106 0.20 £270,000 Old Mutual 5% Floating Medium Rate Notes 21/1/2016 244 0.46 £100,000 Old Mutual 6.376% Perpetual Floating Rate Notes 71 0.13 £250,000 Permanent Financing No.3 5.521% Variable Bonds 10/12/2042 244 0.46 £100,000 Peterborough (Progress Health) 5.58% Guaranteed Asset Backed 2/10/2042 89 0.17

£50,000 Pinton Estates 11.25% Variable Interest Mortgage Backed Debenture 3/3/2012 57 0.11 £235,018 Premier Transmission Financing 5.2022% Guaranteed 31/3/2030 204 0.38

£50,000 Principality Building Society 5.375% Subordinated European Medium Term Floating Rate Notes 8/7/2016 48 0.09

£510,000 Provident Financial 7.125% Notes 15/6/2015 441 0.82 £250,000 Punch Taverns Finance 4.767% Bonds 30/6/2033 220 0.41 £100,000 RBS Capital Trust 5.6457% Perpetual Floating Rate Bonds 69 0.13 £200,000 RMPA Services 5.337% Guaranteed Bonds 30/9/2038 148 0.28

£81,194 Road Management 9.18% Guaranteed Secured Bonds 10/6/2021 92 0.17 £100,000 Royal & Sun Alliance 6.701% Perpetual Subordinated Guaranteed Floating Rate Notes 80 0.15 £480,000 Royal Bank of Scotland 5.5% Perpetual Subordinated Notes 318 0.59

£50,000 Royal Bank Of Scotland 6.625% European Medium Term Notes 17/9/2018 46 0.09 £100,000 Santander Finance Preferred 7.005% Perpetual Floating Rate Notes 84 0.16 £300,000 Santander Issuances Unipersonal 5.75% Guaranteed Subordinated European

Medium Term Floating Rate Notes 31/1/2018 280 0.52





£100,000 Scarborough Building Society 6.875% Perpetual Floating Rate Permanent Interest Bearing Shares 89 0.17

£100,000 Scottish Mortgage Investment Trust 14% Bonds 30/9/2020 166 0.31 £100,000 Scottish Mortgage Investment Trust 6.875% Debenture Stock 31/1/2023 109 0.20 £480,000 Scottish Mutual Assurance 7.25% Perpetual Subordinated Notes 385 0.72 £100,000 Scottish Widows 5.125% Variable Perpetual Notes 81 0.15 £100,000 Siemens Financier 6.125% Floating Rate Notes 14/9/2066 82 0.15

£50,000 Skipton Building Society 5.625% Subordinated European Floating Rate Medium Term Notes 18/1/2018 48 0.09

£50,000 Slough Estates 5.625% Notes 7/12/2020 37 0.07 £100,000 Societe Generale 8.875% Perpetual Subordinated Floating Rate Notes 83 0.15 £720,000 Society of Lloyds 7.421% Perpetual Subordinated Floating Rate Notes 606 1.13 £110,000 South East Water 5.5834% Guaranteed Bonds 29/3/2029 100 0.19 £150,000 South East Water 5.6577% Guaranteed Senior Bonds 30/9/2019 139 0.26 £200,000 Southern Gas Networks 4.875% Medium Term Notes 21/3/2029 162 0.30 £100,000 Southern Water Services 7.869% Floating Rate Medium Term Notes 31/3/2038 104 0.19 £100,000 Spi Elecricity and Gas Australia 7.125% European Medium Term Notes 26/6/2018 104 0.19 £280,000 Spirit Issuer 5.86% Asset Backed Notes 28/12/2021 229 0.43

£50,000 Spirit Issuer 6.582% Asset Backed Notes 28/12/2027 42 0.08 £50,000 Standard Chartered 5.375% Perpetual Medium Term Subordinated Notes 36 0.07

£780,000 Standard Life Funding 6.14% Guaranteed Perpetual European Medium Term Notes 642 1.19 £103,284 Starling Supermarkets Mortgage Backed Floating Rate Notes 5/10/2016 100 0.19 £225,539 Sterling Water Seafield Finance 5.822% Guaranteed Secured Bonds 26/9/2026 191 0.36£100,000 Stockland Finance Party 5.625% Medium Term Notes 25/10/2013 89 0.17

£50,000 Suncorp 6.25% Floating Rate Medium Term Notes 13/6/2027 41 0.08 £100,000 Svenska Handlesbanken 6.4611% Perpetual Floating European Medium Term Notes 85 0.16 £150,000 Swedbank 5.75% Perpetual Floating Rate Notes 115 0.21

£50,000 Talisman Energy 6.625% Bonds 5/12/2017 49 0.09 £50,000 Telecom Emision 5.375% Guaranteed Medium Term Notes 2/2/2026 41 0.08 £50,000 Telecom Italia 6.375% European Medium Term Notes 24/6/2019 44 0.08

£100,000 Temple Bar Investment Trust 5.5% Secured Bonds 8/3/2021 97 0.18 £100,000 Tesco 5.2% Medium Term Notes 5/3/2057 83 0.15 £100,000 Thames Water Utilities Finance 7.241% Guaranteed Medium Term Notes 9/4/2058 101 0.19 £100,000 Three Valleys 5.875% Bonds 13/7/2026 93 0.17

£75,000 Town Centre Securities 5.375% First Mortgage Debenture 21/11/2031 58 0.11 £100,000 UBS 6.625% Senior European Medium Term Notes 11/4/2018 93 0.17 £310,000 UBS AG Jersey 5.25% Floating Rate Medium Term Notes 21/6/2021 259 0.48

£50,000 Unicredito Italiano 5.396% Floating Rate Guaranteed Subordinated Perpetual Notes 39 0.07 £50,000 Universal Building 6.375% Bonds 23/8/2015 49 0.09

£600,000 VTB Capital 6.332% Notes 15/10/2010 532 0.99 £200,000 Wachovia 5.25% Subordinated European Medium Term Notes 1/8/2023 101 0.19 £150,000 Wal-Mart Stores 4.875% Bonds 19/1/2039 123 0.23 £150,000 Washington Mutual Bank 5.5% Subordinated Medium Term Notes 10/6/2019 66 0.12

£50,000 West Bromwich Building Society 6.125% Bonds 20/2/2017 45 0.08 £100,000 Xstrata Fin Canada 7.375% Senior European Medium Term Notes 27/5/2020 95 0.18

£50,000 Yorkshire Buliding Society 5.649% Perpetual Floating Rate Notes 35 0.06 £150,000 Yorkshire Water Services Finance 5.125% Guaranteed Bonds 28/5/2037 128 0.24

OOvveerrsseeaass ((33..0099%%)) 11,,669911 33..1166 EEuurrooppee ((00..8888%%)) 558833 11..0099 EEuurroo DDeennoommiinnaatteedd DDeebbtt SSeeccuurriittiieess ((00..8888%%)) 558833 11..0099 EEuurroo CCoorrppoorraattee BBoonndd SSeeccuurriittiieess ((00..8888%%)) 558833 11..0099

€ 160,000 Citigroup 2.59% Senior Subordinated Floating Rate Notes 13/5/2009 102 0.19 € 150,000 Countrywide Home Loans Floating Rate Senior European Medium Term

Notes 24/11/2008 117 0.22 € 475,000 Hannover Finance (Luxembourg) 6.25% Bonds 14/3/2031 364 0.68




70

Bid-Market Percentage of Holding or Value Total Net Nominal Value £'000 Assets NNoorrtthh AAmmeerriiccaa DDeebbtt SSeeccuurriittiieess ((22..2211%%)) 11,,110088 22..0077 UUSS DDoollllaarr DDeennoommiinnaatteedd DDeebbtt SSeeccuurriittiieess ((22..2211%%)) 11,,110088 22..0077 UUSS DDoollllaarr CCoorrppoorraattee BBoonndd SSeeccuurriittiieess ((22..2211%%)) 11,,110088 22..0077

USD 500,000 Bay Haven Asset Backed Floating Rate Bonds 24/2/2010 280 0.52 USD 60,000 CIT Floating Rate Notes 17/8/2009 27 0.05

USD 115,000 CIT Floating Rate Senior Notes 8/6/2009 57 0.11 USD 30,000 CIT 4.125% Senior Notes 3/11/2009 14 0.03

USD 400,000 Ford Motor Credit 7.25% Notes 1/10/2008 221 0.41 USD 250,000 Gamut Reinsurance Asset Backed Floating Rate Notes 31/7/2011 134 0.25

USD 1,150,000 Old Mutual Capital Funding 8% Guaranteed Perpetual Cumulative Preference 375 0.70

DDeerriivvaattiivveess ((((00..0088))%%)) ((MMaattuurriittyy ddaatteess ffoorr ffoorrwwaarrddss aass sshhoowwnn iinn bbrraacckkeettss)) 77 00..0011 FFoorrwwaarrdd CCuurrrreennccyy CCoonnttrraaccttss ((((00..0088))%%)) ((MMaattuurriittyy ddaatteess ffoorr ffoorrwwaarrddss aass sshhoowwnn iinn bbrraacckkeettss)) 77 00..0011

Bought USD 71,856 : Sold GBP 71,576 (23/10/2008) 0 0.00 Bought USD 82,911 : Sold GBP 81,367 (23/10/2008) 1 0.00 Bought USD 38,692 : Sold GBP 38,893 (23/10/2008) 0 0.00 Bought EUR 7,895 : Sold GBP 7,981 (16/10/2008) 0 0.00 Bought EUR 15,789 : Sold GBP 15,962 (16/10/2008) 0 0.00 Bought GBP 605,895 : Sold EUR 599,991 (16/10/2008) 6 0.01 Bought GBP 15,915 : Sold EUR 15,789 (16/10/2008) 0 0.00




All investments are listed on recognised stock exchanges and are "approved securities" within the meaning of the FSA Rules unless otherwise stated.The figures in brackets show the comparative percentage holdings as at 31 March 2008.*These stocks are valued at the fund manager's best price.

Bid MarketHolding or valuenominal value £'000bboonndd rraattiinnggss ddiisscclloossuurreeRRaattiinngg

AAA 27,576 Aa3 153 AA+ 940

AA 1,119 AA- 590 A2 171 A1 568 A+ 3,121

A 4,327 A- 3,634

Baa2 42 B+ 221

BBB+ 4,338 BBB 1,601

BBB- 543 NR 2,851

TToottaall vvaalluuee ooff sseeccuurriittiieess 5511,,779955






££''000000 ££''000000Treasury 4.5% Stock 2013 6,918 Treasury 4.5% Stock 2013 8,970Treasury 8% Stock 2013 5,224 Treasury 4.25% Stock 2027 3,427Treasury 4.75% Stock 2010 4,438 Treasury 8.75% Stock 2017 2,723Treasury 8.75% Stock 2017 2,732 Treasury 6% Stock 2028 2,655Treasury 4.25% Stock 2055 2,698 Treasury 4.25% Stock 2046 2,523Treasury 4.25% Stock 2027 2,591 Treasury 4.75% Stock 2010 2,442Treasury 4.25% Stock 2046 2,476 Treasury 4.25% Stock 2055 2,279Treasury 8% Stock 2015 1,689 Treasury 8% Stock 2013 1,802Treasury 4.25% Stock 2036 1,578 Treasury 8% Stock 2021 1,550Treasury 4% Stock 2009 1,343 Treasury 4% Stock 2009 1,345Treasury 8% Stock 2021 1,256 Treasury 5% Stock 2025 1,045Treasury 4.75% Stock 2020 836 Treasury 5% Stock 2018 1,026Treasury 5% Stock 2025 826 Treasury 4.25% Stock 2032 990Treasury 6% Stock 2028 819 Treasury 8% Stock 2015 776Treasury 5% Stock 2012 781 Treasury 4.75% Stock 7/12/2030 759Treasury 4.25% Stock 2032 729 Kreditanstalt Fur Wiederaufbau 5.5% Treasury 4.5% Stock 2042 572 Guaranteed Bonds 7/12/2015 757Treasury 4.25% Gilt 2049 521 BAA 5.75% European Medium Term Notes 10/12/2031 712Treasury 4.75% Stock 2015 504 Treasury 4.75% Stock 2038 653Treasury 0% Bill 22/92008 498 Treasury 4.5% Stock 2042 592

Treasury 4.25% Stock 2036 579Other purchases for the period 6,568 Other sales for the period 5,593


The above statement reflects the 20 largest aggregate purchases and sales during the period, or those purchases and sales greater than 2% of the netasset value of the Fund at the start of the period where they number greater than 20. In the instance where there are less than 20 purchases or salesduring the period all purchases and sales are shown.




72


££''000000 ££''000000



(Losses)/gains on forward currency contracts (75) 27



££''000000 ££''000000

Bank interest 30 25

Interest on debt securities 1,609 1,520



££''000000 ££''000000




56 32





12 15


Audit fees 6 6

6 6



££''000000 ££''000000




Deferred tax charge for the period (see note 4 (a)) 0 0






Effects of:



Tax effect of interest distributions (311) (297)






44 TTaaxxaattiioonn

((cc)) DDeeffeerrrreedd ttaaxxaattiioonn

There is no provision for deferred taxation required at the end of the period (2007: £Nil).




££''000000 ££''000000




NNeett ddiissttrriibbuuttiioonn ffoorr tthhee ppeerriioodd 1,555 1,485

Interest 11 10








££''000000 ££''000000

Accrued income 1,049 1,033

Amounts receivable for creation of shares 110 0

Sales awaiting settlement 364 2,415



££''000000 ££''000000



Accrued depositary's fee 2 6





Income tax payable 631 319


Total creditors 1,470 1,203






££''000000 ££''000000








74


The Fund currently has three share classes in issue. The current annual ACD charge as a percentage of daily net asset value is as follows:











3300 SSeepptteemmbbeerr 22000088CCuurrrreennccyy ££''000000 ££''000000 ££''000000Euro 583 (578) 5US dollar (819) 817 (2)Total (236) 239 3

MMoonneettaarryy NNoonn mmoonneettaarryy EExxppoossuurreess EExxppoossuurreess TToottaall

3311 MMaarrcchh 22000088CCuurrrreennccyy ££''000000 ££''000000 ££''000000Euro 0 (27) (27)US dollar 0 (5) (5)Total 0 (32) (32)


The interest rate risk profile of the financial assets and liabilities at the balance sheet date was as follows:FFllooaattiinngg rraattee FFiixxeedd rraattee FFiinnaanncciiaall aasssseettss//

ffiinnaanncciiaall aasssseettss// ffiinnaanncciiaall aasssseettss ((lliiaabbiilliittiieess)) nnoott((lliiaabbiilliittiieess)) ccaarrrryyiinngg iinntteerreesstt TToottaall

3300 SSeepptteemmbbeerr 22000088 ££''000000 ££''000000 ££''000000 ££''000000Euro 583 0 (578) 5Sterling 13,100 39,829 617 53,546US dollar (819) 611 206 (2)TToottaall 12,864 40,440 245 53,549

3311 MMaarrcchh 22000088 ££''000000 ££''000000 ££''000000 ££''000000Euro 492 0 (519) (27)Sterling 12,005 40,223 3,776 56,004US dollar 384 866 (1,255) (5)TToottaall 12,881 41,089 2,002 55,972





((bb)) AAvveerraaggee iinntteerreesstt rraattee rriisskk pprrooffiillee

The following table represents the weighted average interest rate and the weighted average fixed period for fixed rate investments inthe portfolio and will not necessarily reflect the yield on each fund.

FFiixxeedd rraattee ffiinnaanncciiaall aasssseettss WWeeiigghhtteedd aavveerraaggee WWeeiigghhtteedd aavveerraaggee ppeerriioodd

iinntteerreesstt rraattee ffoorr wwhhiicchh rraattee iiss ffiixxeedd 3300 SSeepptteemmbbeerr 22000088Sterling 6.05% 15.61 yearsUS dollar 7.10% 0.07 years

FFiixxeedd rraattee ffiinnaanncciiaall aasssseettss WWeeiigghhtteedd aavveerraaggee WWeeiigghhtteedd aavveerraaggee ppeerriioodd

iinntteerreesstt rraattee ffoorr wwhhiicchh rraattee iiss ffiixxeedd 3311 MMaarrcchh 22000088Sterling 5.58% 17.03 yearsUS dollar 7.42% 1.73 years









1111 PPoorrttffoolliioo ttrraannssaaccttiioonn ccoossttss

There were no transaction costs associated with the purchases or sales of investments during the accounting period.






76


Group 1 - Shares purchased on or before 31 March 2008

Group 2 - Shares purchased from 1 April 2008 and up to 30 September 2008

GGrroossss IInnccoommee NNeett DDiissttrriibbuuttiioonn DDiissttrriibbuuttiioonniinnccoommee ttaaxx iinnccoommee EEqquuaalliissaattiioonn ppaayyaabbllee ppaaiidd

2288 NNoovveemmbbeerr 22000088 3300 NNoovveemmbbeerr 22000077RReettaaiill aaccccuummuullaattiioonn CCllaassss 11Group 1 2.2983 0.4597 1.8386 - 1.8386 1.7003Group 2 1.1020 0.2204 0.8816 0.9570 1.8386 1.7003

IInnssttiittuuttiioonnaall aaccccuummuullaattiioonn CCllaassss 22Group 1 2.5556 0.5111 2.0445 - 2.0445 1.9036Group 2 2.5556 0.5111 2.0445 0.0000 2.0445 1.9036

SSttaannddaarrdd LLiiffee aaccccuummuullaattiioonn CCllaassss 33Group 1 3.1841 0.6368 2.5473 - 2.5473 2.3912Group 2 1.3058 0.2612 1.0446 1.5027 2.5473 2.3912

Please see equalisation note in accounting policies






IInnvveessttmmeenntt PPoolliiccyyThe investment policy of the Fund is to invest primarily in equities and equity type investments ofcompanies incorporated in the UK or which in the opinion of the Investment Adviser (or sub-adviser), carry on a substantial part of their operations in the UK. "Equity type investments" willinclude convertible stocks, stock exchange listed warrants, depositary receipts and any other suchinvestments which entitle the holder to subscribe for or convert into the equity of the companyand/or where the share price performance is, in the opinion of the Investment Adviser (or sub-adviser), influenced significantly by stock market performance of the company's ordinary shares. TheFund may also invest in deposits, money market instruments and collective investment schemes.


EEnnvviirroonnmmeennttThe UK stock market performed poorly over the period, as the financial crisis came to a head. The ongoing dearth of liquidity weighed on thefinancial sector, prompting widespread volatility.

The failure of US institutions, including Lehman Brothers, triggered heavy selling of bank shares in the UK and brought about the rescue sale ofHBOS to Lloyds TSB. Not all banks suffered, though, and HSBC delivered strong gains.

Meanwhile, deteriorating confidence in the global economy saw some commodity prices, including oil and metals, rapidly drop from their highs.House price falls reached double digit levels, mortgage approvals collapsed and consumer sentiment weakened. The Monetary Policy Committeeheld interest rates steady as inflation reached a 16-year high of 4.7% in August.

AAccttiivviittyyThe Fund’s managers added Cookson Group after an acquisition consolidated its global leadership in the steel industry. A new holding was initiatedin National Grid, to increase the Fund’s exposure to defensive names. Another defensive purchase was Imperial Tobacco, as its long-term growthprospects were positive.

New positions were taken in Avis, on increased confidence that management could turn around the company, KPN, given its attractive valuationsand high free cashflow, and Icap, which trades at a significant discount despite having a dominant market position.

Included among the sales activity was profit taking in Royal Bank of Scotland and also travel services firm Tui, after a good performance duringAugust. The Fund’s managers sold Vodafone, due to deteriorating sales in its Spanish subsidiary. Wolseley was also sold after it cancelled its finaldividend payment, and because of the company’s exposure to the US housing market.

PPeerrffoorrmmaannccee Energy and materials drove performance at the start of the period, which benefited the Fund’s overweight position in energy stocks. The Fund’soverweight position in another top performer, Yara International, also contributed to performance, as this materials company benefited from acontinued increase in commodity prices throughout the month of April. Early in the period, energy stocks performed well, as crude oil surpassed the $130 threshold. Our holdings in Royal Dutch Shell, Statoilhydro, andGazprom benefited from the high oil price. At the end of the period, materials and energy were the worst-performing sectors while more defensive sectors performed well with healthcare andconsumer staples being among the best in the market. Against this backdrop, the Fund’s overweight position in utilities contributed toperformance.

OOuuttllooookkThe outlook in the UK remains uncertain, as the market continues to worry over the extent of the slowdown in the US. In the short-term,companies remain susceptible to bouts of volatility and risk aversion. Over the longer term, an easing of the credit crisis, a fall in inflation and signsof economic recovery will be key triggers for an upturn. Overall, the earnings outlook for the UK is set to slow, led down by financial and consumerareas of the market. However, the widespread sell-off has meant that fundamentally sound companies have fallen in value along with the widermarket, offering some compelling opportunities.


UUKK EEqquuiittyy MMaannaaggeerr ooff MMaannaaggeerrss FFuunndd

IInnvveessttmmeenntt SSuubb--AAddvviisseerrssAAlllliiaannccee CCaappiittaall LLiimmiitteedd

NNeewwttoonn IInnvveessttmmeenntt MMaannaaggeemmeenntt LLiimmiitteedd

BBaaiilllliiee GGiiffffoorrdd OOvveerrsseeaass LLiimmiitteedd

MMccKKiinnlleeyy CCaappiittaall MMaannaaggeemmeenntt,, IInncc


BBeenncchhmmaarrkk IMA UK All Companies Sector


78














AAss aatt sshhaarree ccllaassss sshhaarree ccllaassss sshhaarree ccllaassss sshhaarree ccllaassss31 March 2007 1.89% 1.03% 0.04% n/a31 March 2008 1.92% 1.07% 0.07% 0.06%30 September 2008 1.91% 1.06% 0.06% 0.03%







££''000000 ££''000000 ££''000000 ££''000000



Income 2 3,824 3,529

Expenses 3 (142) (81)

Finance costs: interest 5 (2) (7)


Taxation 4 (89) (57)


TToottaall rreettuurrnn bbeeffoorree ddiissttrriibbuuttiioonnss (22,233) (759)





££''000000 ££''000000 ££''000000 ££''000000





160 152

Dilution levy 4 0

Stamp duty reserve tax (8) 0







££''000000 ££''000000 ££''000000 ££''000000

AAsssseettss::


Debtors 6 1,766 3,219



Total assets 142,358 163,573



Creditors 7 (1,625) (464)

Bank overdraft (1) (1)

Total other liabilities (1,626) (465)

Total liabilities (1,626) (764)









80

Bid-Market Percentage of Holding or Value Total Net Nominal Value £'000 Assets UUnniitteedd KKiinnggddoomm EEqquuiittiieess ((8899..3322%%)) 113322,,888844 9944..4422 AAeerroossppaaccee && DDeeffeennccee ((11..6611%%)) 44,,008833 22..9900

87,083 Aero Inventory 310 0.22 391,883 BAE Systems 1,587 1.12 18,677 Chemring 377 0.27

229,700 Cobham 435 0.31 307,705 Meggit 572 0.41 244,074 Rolls Royce 802 0.57

AAuuttoommoobbiilleess && PPaarrttss ((00..1133%%)) 224400 00..1177

124,186 GKN 240 0.17

BBaannkkss ((1100..1144%%)) 1177,,114477 1122..1188

591,087 Barclays 1,869 1.33 494,690 HBOS 615 0.44

1,065,041 HSBC (UK Registered) 9,364 6.65 132,300 Lloyds TSB 298 0.21

1,758,779 Royal Bank of Scotland 3,004 2.13 150,384 Standard Chartered 1,997 1.42

BBeevveerraaggeess ((00..9922%%)) 11,,661155 11..1155

175,126 Britvic 350 0.25 72,385 Diageo 688 0.49 54,000 SABMiller 577 0.41

CChheemmiiccaallss ((00..2200%%)) 11,,114466 00..8811

78,130 Croda 471 0.33 50,564 Johnson Matthey 675 0.48

EElleeccttrriicciittyy ((22..2255%%)) 33,,000088 22..1144

60,100 Drax Industries 452 0.32 144,884 International Power 518 0.37 145,652 Scottish & Southern Energy 2,038 1.45

EElleeccttrroonniicc && EElleeccttrriiccaall EEqquuiippmmeenntt ((00..5522%%)) 331199 00..2233

166,884 Chloride 319 0.23

FFiixxeedd LLiinnee TTeelleeccoommmmuunniiccaattiioonnss ((11..7788%%)) 11,,883344 11..3300

408,211 BT 652 0.46 726,733 Cable & Wireless 1,182 0.84

FFoooodd && DDrruugg RReettaaiilleerrss ((00..9955%%)) 22,,778866 11..9988

2,686 Greggs 84 0.06 51,400 Sainsbury's 180 0.13

572,900 Tesco 2,522 1.79

FFoooodd PPrroodduucceerrss ((22..1199%%)) 11,,221100 00..8866

61,300 Associated British Foods 435 0.31 341,498 Premier Foods 257 0.18

66,621 Tate & Lyle 253 0.18 17,710 Unilever 265 0.19

GGaass WWaatteerr && MMuullttii--UUttiilliittiieess ((33..0011%%)) 44,,887700 33..4466

601,001 Centrica 1,868 1.32 204,065 National Grid 1,429 1.02 80,192 Severn Trent 1,072 0.76 73,572 United Utilities 501 0.36




Bid-Market Percentage of Holding or Value Total Net Nominal Value £'000 Assets UUnniitteedd KKiinnggddoomm EEqquuiittiieess ((ccoonnttiinnuueedd))GGeenneerraall FFiinnaanncciiaall ((11..8899%%)) 11,,774411 11..2244

309,369 3i Infrastructure 336 0.24 21,817 3i Infrastructure Warrants to subscribe for Ordinary 3 0.00

259,175 Aberdeen Asset Management 314 0.22 109,730 ICAP 371 0.26

1,263 Intermediate Capital 18 0.01 22,000 International Personal Finance 54 0.04

188,575 Man 599 0.44 5,500 Provident Financial 46 0.03

GGeenneerraall IInndduussttrriiaallss ((22..1144%%)) 995544 00..6688

121,548 REXAM 472 0.34 197,100 Smith (DS) 214 0.15 175,334 Tomkins 268 0.19

GGeenneerraall RReettaaiilleerrss ((00..9900%%)) 22,,113333 11..5522

140,072 ASOS 481 0.35 191,187 Game 381 0.27 136,431 Halfords 344 0.24 137,600 Home Retail 319 0.23 168,822 Inchcape 316 0.22

97,245 Marks & Spencer 200 0.14 8,900 Next 92 0.07

HHoouusseehhoolldd GGooooddss ((00..5577%%)) 11,,001144 00..7722

46,500 Persimmon 186 0.13 26,746 Reckitt Benckiser 718 0.51

319,949 Taylor Woodrow 110 0.08

IInndduussttrriiaall EEnnggiinneeeerriinngg ((00..9933%%)) 22,,333366 11..6666

63,120 Halma 123 0.09 97,086 IMI 349 0.25

172,900 Melrose 235 0.17 42,415 Rotork 385 0.27

424,619 Senior 360 0.26 147,958 Weir 884 0.62

IInndduussttrriiaall TTrraannssppoorrttaattiioonn ((00..3366%%)) 553300 00..3388

234,906 BBA Aviation 259 0.19 143,988 Wincanton 271 0.19

LLiiffee IInnssuurraannccee ((22..1133%%)) 33,,221155 22..2288

295,533 Aviva 1,781 1.26 571,895 Legal & General 555 0.39 128,341 Old Mutual 96 0.07 113,000 Prudential 571 0.41

97,556 St James's Place 212 0.15

MMeeddiiaa ((66..0044%%)) 33,,882244 22..7722

26,600 Daily Mail & General Trust 'A' Shares 85 0.06 205,775 Pearson 1,227 0.87 388,409 Reed Elsevier 2,113 1.51 525,610 Yell 399 0.28




82

Bid-Market Percentage of Holding or Value Total Net Nominal Value £'000 Assets UUnniitteedd KKiinnggddoomm EEqquuiittiieess ((ccoonnttiinnuueedd))MMiinniinngg ((55..7744%%)) 99,,553311 66..7777

89,729 Anglo American 1,633 1.16 77,800 Antofagasta 309 0.22

321,806 BHP Billiton 3,971 2.81 66,420 Kazakhmys 375 0.27 28,000 Lonmin 587 0.42 36,647 Rio Tinto 1,236 0.88 45,660 Vedanta Resources 507 0.36 55,280 Xstrata 913 0.65

MMoobbiillee TTeelleeccoommmmuunniiccaattiioonnss ((55..8822%%)) 88,,113388 55..7788

108,180 Inmarsat 520 0.37 6,280,274 Vodafone 7,618 5.41

NNoonn EEqquuiittyy IInnvveessttmmeenntt IInnssttrruummeennttss ((11..1100%%)) 11,,667700 11..1199

679,112 Baillie Gifford British Small Companies 1,670 1.19

NNoonn LLiiffee IInnssuurraannccee ((22..5544%%)) 33,,110022 22..2200

45,608 Admiral 897 0.63 89,700 Amlin 277 0.20

211,128 Catlin 726 0.52 99,100 Hiscox 239 0.17 26,860 Jardine Lloyd Thompson 112 0.08

565,286 Royal & Sun Alliance 851 0.60

OOiill && GGaass PPrroodduucceerrss ((1155..6677%%)) 2244,,779966 1177..6622

374,686 BG 3,758 2.67 1,896,921 BP 8,678 6.17

61,656 Cairn Energy 1,264 0.90 163,170 Royal Dutch Shell 'A' Shares 2,609 1.85 515,910 Royal Dutch Shell 'B' Shares 7,976 5.67

72,664 Tullow Oil 511 0.36

OOiill EEqquuiippmmeenntt SSeerrvviicceess && DDiissttrriibbuuttiioonn ((00..3366%%)) 999999 00..7711

77,893 Petrofac 442 0.31 169,577 Wood (J) 557 0.40

PPeerrssoonnaall GGooooddss ((00..0000%%)) 552266 00..3377

119,944 SSL International 526 0.37

PPhhaarrmmaacceeuuttiiccaallss && BBiiootteecchhnnoollooggyy ((66..3377%%)) 1100,,119900 77..2244

126,421 AstraZeneca 3,109 2.21 579,944 GlaxoSmithKline 7,081 5.03

RReeaall EEssttaattee ((00..0077%%)) 3377 00..0033

110,647 Dawnay Day Carpathian 37 0.03

SSooffttwwaarree && CCoommppuutteerr SSeerrvviicceess ((11..9999%%)) 22,,226699 11..6611

57,488 Autonomy 589 0.42 34,761 Aveva 391 0.28

293,873 Logica 317 0.23 504,561 Sage 972 0.68




Bid-Market Percentage of Holding or Value Total Net Nominal Value £'000 Assets UUnniitteedd KKiinnggddoomm EEqquuiittiieess ((ccoonnttiinnuueedd))SSuuppppoorrtt SSeerrvviicceess ((44..6688%%)) 77,,112277 55..0066

77,021 Aggreko 410 0.29 67,314 AMEC 411 0.29 81,992 Babcock International 387 0.27

128,222 Bunzl 832 0.59 84,483 Capita 589 0.42

111,038 Connaught 414 0.29 114,918 Davis Service 308 0.22

49,808 De La Rue 444 0.32 135,000 Experian 474 0.34

71,900 Group 4 Securior 144 0.10 237,000 Hays 181 0.13

24,701 Homeserve 351 0.25 92,703 Interserve 284 0.20 11,893 Intertek 98 0.07 46,830 Michael Page 107 0.08

118,950 Mondi (GB Line) 298 0.21 374,909 Premier Farnell 608 0.43

98,952 Serco 361 0.26 402,805 Spice 426 0.30

TToobbaaccccoo ((33..1122%%)) 66,,117744 44..3399

295,276 British American Tobacco 5,412 3.85 43,000 Imperial Tobacco 762 0.54

TTrraavveell && LLeeiissuurree ((33..2200%%)) 44,,332200 33..0077

314,218 888 403 0.29 69,300 Arriva 469 0.33 11,102 Carnival 183 0.13

172,354 Compass 585 0.42 90,600 First 482 0.34 23,426 Go-Ahead 385 0.27 23,411 National Express 185 0.13

207,248 Stagecoach 524 0.37 189,800 Thomas Cook 408 0.29 324,334 Tui Travel 696 0.50

EEuurrooppee EEqquuiittiieess ((55..7733%%)) 22,,669988 11..9922 BBeellggiiuumm ((00..0000%%)) 229966 00..2211

4,400 Solvay 296 0.21

FFrraannccee ((00..7744%%)) 228866 00..2200

6,100 Renault (Regie Nationale Des Usines) 210 0.15 2,100 Sanofi-Aventis 76 0.05

GGeerrmmaannyy ((11..6622%%)) 559977 00..4422

3,700 Allianz (Registered) 271 0.19 12,400 BASF 326 0.23

IIrreellaanndd ((00..1188%%)) 00 00..0000 LLuuxxeemmbboouurrgg ((00..3322%%)) 223388 00..1177

400 Arcelor 11 0.01 8,336 Arcelor (Dutch Line) 227 0.16

NNeetthheerrllaannddss ((11..5544%%)) 223300 00..1166

20,700 ING 230 0.16




84

Bid-Market Percentage of Holding or Value Total Net Nominal Value £'000 Assets EEuurrooppee EEqquuiittiieess ((ccoonnttiinnuueedd))NNoorrwwaayy ((11..3333%%)) 11,,005511 00..7766

52,350 Norsk Hydro 175 0.13 69,356 Statoil 876 0.63

AAssiiaa PPaacciiffiicc EEqquuiittiieess ((00..9900%%)) 442255 00..3300 AAuussttrraalliiaa ((00..2255%%)) 442255 00..3300

228,552 Telstra 425 0.30

HHoonngg KKoonngg ((00..6655%%)) 00 00..0000 NNoorrtthh AAmmeerriiccaa EEqquuiittiieess ((00..8833%%)) 00 00..0000 UUnniitteedd SSttaatteess ooff AAmmeerriiccaa ((00..8833%%)) 00 00..0000 UUnniitteedd KKiinnggddoomm DDeerriivvaattiivveess ((--00..1188%%)) 00 00..0000 SStteerrlliinngg DDeennoommiinnaatteedd FFoorrwwaarrdd EExxcchhaannggee CCoonnttrraaccttss ((--00..1188%%)) 00 00..0000










££''000000 ££''000000HSBC (UK Registered) 3,674 British Energy 2,014BP 2,570 Smiths 1,994BHP Billiton 2,414 Royal Dutch Shell 'B' Shares 1,924Royal Dutch Shell 'A' Shares 2,368 Unilever 1,603Xstrata 2,062 Centrica 1,565Rio Tinto 2,042 GlaxoSmithKline 1,500Imperial Tobacco 1,845 Yara International 1,474Royal Bank of Scotland 1,680 AstraZeneca 1,455AstraZeneca 1,514 Eurasian Natural 1,395Tesco 1,264 Royal & Sun Alliance 1,390Cookson 1,209 Cable & Wireless 1,317Standard Chartered 1,001 Petrochina 'H' 1,308Vedanta Resources 979 Sage 1,299Sage 941 Logica 1,289BAE Systems 871 Lloyds TSB 1,271Vodafone 856 GCap Media 1,268Scottish & Southern Energy 804 Gazprom ADR (Representing 10 ordinary - Reckitt Benckiser 753 Registered 'S' shares) 1,203SSAB 716 Taylor Nelson 1,192Rentokil Initial 702 Vallourec (Usin A Tub De Lor Escaut) 1,177

Cookson 1,172Other purchases for the period 32,539 Other sales for the period 29,893


The above statement reflects the 20 largest aggregate purchases and sales during the period, or those purchases and sales greater than 2% of thenet asset value of the Fund at the start of the period where they number greater than 20.




86


££''000000 ££''000000



Gains on forward currency contracts 43 0



££''000000 ££''000000

Bank interest 99 91


Stock lending 0 3

Unfranked dividends 19 0

UK dividends 3,253 3,158

UK dividends from collective investment schemes (franked) prior year adjustment (2) 0

Underwriting commission 0 1



££''000000 ££''000000




96 50




Safe custody fees 7 (1)

40 25


Audit fees 6 6

6 6



££''000000 ££''000000






Deferred tax (credit)/charge for the period (see note 4 (c)) (3) 2






Effects of:




Movement in income accruals not taxable 2 (9)

UK dividends not subject to corporation tax (650) (632)






44 TTaaxxaattiioonn ((CCoonnttiinniieedd)) 3300 SSeepptteemmbbeerr 22000088 3300 SSeepptteemmbbeerr 22000077

££''000000 ££''000000



Deferred tax (credit)/charge for the period (see note 4 (a)) (3) 2

DDeeffeerrrreedd ttaaxx pprroovviissiioonn aatt tthhee eenndd ooff tthhee ppeerriioodd ((sseeee nnoottee 77)) 3 3




££''000000 ££''000000


Income deducted on cancellation of shares (3) 470

Income received on creation of shares 2 (16)

NNeett ddiissttrriibbuuttiioonn ffoorr tthhee ppeerriioodd 3,605 3,388

Interest 2 7








££''000000 ££''000000

Accrued income 533 1,348

Income tax recoverable 0 1


Sales awaiting settlement 1,225 1,862



££''000000 ££''000000







Bank interest payable 0 2



Purchases awaiting settlement 1,480 266

TToottaall ccrreeddiittoorrss 1,625 464




88






££''000000 ££''000000






The Fund currently has four share classes in issue: Retail Accumulation, Institutional Accumulation, Standard Life Accumulation and PensionAccumulation.

The current annual ACD charge as a percentage of daily net asset value is as follows:





The net asset value of each share class, the net asset value per share and the number of shares in issue in each share class are given in thecomparative tables on page 78. The distribution per share class is given in the distribution tables on page 90.







3300 SSeepptteemmbbeerr 22000088CCuurrrreennccyy ££''000000 ££''000000 ££''000000Australian dollar 0 425 425Euro 6 1,653 1,659Norwegian kroner 10 1,051 1,061Swedish krona (1) 0 (1)Swiss franc 0 3 3US dollar 7 608 615TToottaall 22 3,740 3,762

3311 MMaarrcchh 22000088CCuurrrreennccyy ££''000000 ££''000000 ££''000000Australian dollar 0 423 423Euro 1,214 2,168 3,382Hong Kong dollar 0 1,064 1,064Norwegian kroner 4 2,161 2,165Swiss franc (1) 0 (1)US dollar 5 2,660 2,665TToottaall 1,222 8,476 9,698






The interest rate risk profile of the financial assets and liabilities at the balance sheet date was as follows:FFllooaattiinngg rraattee FFiinnaanncciiaall aasssseettss//

ffiinnaanncciiaall aasssseettss// ((lliiaabbiilliittiieess)) nnoott((lliiaabbiilliittiieess)) ccaarrrryyiinngg iinntteerreesstt TToottaall

3300 SSeepptteemmbbeerr 22000088 ££''000000 ££''000000 ££''000000Australian dollar 0 425 425Euro 6 1,653 1,659Norwegian kroner 10 1,051 1,061Sterling 4,562 132,408 136,970Swedish krona (1) 0 (1)Swiss franc 0 3 3US dollar 7 608 615TToottaall 4,584 136,148 140,732

FFllooaattiinngg rraattee FFiinnaanncciiaall aasssseettss// TToottaall3311 MMaarrcchh 22000088 ££''000000 ££''000000 ££''000000Australian dollar 0 423 423Euro 1,214 2,168 3,382Hong Kong dollar 0 1,064 1,064Norwegian kroner 4 2,161 2,165Sterling 3,033 150,078 153,111Swiss franc (1) 0 (1)US dollar 5 2,660 2,665TToottaall 4,255 158,554 162,809





The borrowing facilities available to the company as at 30 September 2008 comprise an overdraft facility of 10% the value of theCompany.

The overdraft is repayable on demand. Overdraft balances attract interest based on 1% above the base rates.







Analysis of total sales costs:Sales in period before transaction costs 58,726 34,769Commissions and other costs (23) (44)Total sales costs (23) (44)TToottaall ssaalleess nneett ooff ttrraannssaaccttiioonn ccoossttss 58,703 34,725


At the balance sheet date the sub-fund has contingent liabilities in respect of warrants £21,817 (31 March 2008 - £2,182).




90








*Please see equalisation note in accounting policies







www.standardlifeinvestments.co.uk

Standard Life Investments Limited, tel. +44 131 225 2345, a company registered in Scotland (SC 123321) Registered Office 1 George Street Edinburgh EH2 2LL.

The Standard Life Investments group includes Standard Life Investments (Mutual Funds) Limited, SLTM Limited, Standard Life Investments (Corporate Funds) Limited and SLCapital Partners LLP. Standard Life Investments Limited acts as Investment Manager for Standard Life Assurance Limited and Standard Life Pension Funds Limited.

Standard Life Investments may record and monitor telephone calls to help improve customer service. All companies are authorised and regulated by the Financial ServicesAuthority. ©2008 Standard Life Investments. www.standardlifeinvestments.com

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