Reports MYKNGSGF

KENANGA SYARIAH GROWTH FUND
Report to Unit Holders

For the financial year ended
31st December 2010
Level 39, Menara Standard Chartered

Jalan Sultan Ismail 50250 Kuala Lumpur Malaysia
Tel +603 2142 6888 Fax +063 2142 6887
www.KenangaInvestors.com.my
Kenanga Syariah Growth Fund
CONTENTS
_________________________________________________________________________
CONTENTS
_________________________________________________________________________
Page
Manager’s Report – Kenanga Syariah Growth Fund 2
Page
Performance Data – Kenanga Syariah Growth Fund
Manager’s Report 27
Policy on Stockbroking
Performance Data Rebates and Soft Commissions 97
Policy on Stockbroking
Trustee’s Report Rebates and Soft Commissions 10
9
Shariah
Trustee’sAdviser’s
Report Report 11
10
Statement by the Manager
Shariah Adviser’s Report 12
11
Independent
Statement byAuditors’ Report
the Manager 13
12
Statement of Auditors’
Independent Comprehensive
ReportIncome 15
13
Statement
Statement of
of Financial Position
Comprehensive Income 16
15
Statement of Changes in Equity
Statement of Financial Position 17
16
Statement of Changes
Statement of Cash Flows
in Equity 18
17
Notes to the Financial
Statement of Cash Flows Statements 19
18
Offices
Notes toDirectory
the Financial Statements 51
19
Offices Directory 51
1

MANAGER’S REPORT
MANAGER’S REPORT
The Manager hereby submits the report and the account of the fund for the year ended 31
December 2010.
The Manager hereby submits the report and the account of the fund for the year ended 31
December 2010. Review / Outlook
Equity Market
Equity
Market Market
Review Review / Outlook
Market Review1H2010, the local bourse gathered momentum and performed well in the
After a volatile
2H2010. The Kuala Lumpur Composite Index (KLCI) rose by 3.8% in the 1Q2010, eased
After a volatile
marginally 1H2010,
by 0.5% the2Q2010
in the local bourse
before gathered
surgingmomentum
by 11.4% and performed
in the 3Q2010 well in the
largely on
2H2010.
account ofThetheKuala
influxLumpur Composite
of short-term Index
capital (KLCI) rose
to emerging by 3.8%
markets, in the
which was1Q2010, eased
reinforced by
marginally
the country’s by 0.5%
improvedin theeconomic
2Q2010 fundamentals,
before surging corporate
by 11.4% earnings
in the 3Q2010
upgrade largely
and on an
account of the
appreciating influx ofThe
currency. short-term
momentum capital to emerging
continued markets,fuelled
into 4Q2010 whichby was reinforced
a fresh round byof
the country’sEasing
Quantitative improved
(QE) economic fundamentals,
in the US with corporateupearnings
the KLCI chalking upgrade
another 3.8% and an
in 4Q2010.
appreciating currency.
For the full year, The was
the KLCI momentum
up 19.3%. continued into 4Q2010 fuelled by a fresh round of
Quantitative Easing (QE) in the US with the KLCI chalking up another 3.8% in 4Q2010.
For
2010thesaw
fullayear,
major thepush
KLCI inwas up 19.3%.
domestic policy direction. The Government Transformation
Programme (GTP) launch on 29 January set the tone, followed by the unveiling of the
2010 saw a major
New Economic push(NEM)
Model in domestic
on 30-31 policy
March,direction. The Government
10th Malaysia Plan (10MP) Transformation
on 10 June,
Programme
and Economic (GTP) launch on 29Programme
Transformation January set(ETP)the tone,
on 25followed
October. byThe
the final
unveiling
part of the
th
New Economic
NEM was unveiled Model
on 3(NEM) on 30-31 March, 10 Malaysia Plan (10MP) on 10 June,
December.
and Economic Transformation Programme (ETP) on 25 October. The final part of the
NEM
On fundwasflows,
unveiled
neton 3 December.
equity flows into Malaysia turned positive in June 2010 after six
consecutive months of outflows. Malaysia benefited on the positive flow of funds into
On fund flows,
Emerging net equity for
Asia, accounting flows
12.8%into ofMalaysia
the totalturned
USD1.61bpositive in first
in the June102010 afterAssixa
months.
consecutive
result, foreignmonths of outflows.
shareholding Malaysia
in Malaysian benefited
equities on thefrom
recovered positive
a lowflow of funds
of 20.3% into
in May
Emerging Asia, by
2010, to 22.1% accounting for 12.8%
end November 2010.of the total USD1.61b in the first 10 months. As a
result, foreign shareholding in Malaysian equities recovered from a low of 20.3% in May
2010,
On thetoearnings
22.1% byfront,
end November 2010. for KLCI was estimated to grow at 15% in
corporate earnings
early 2010 but was continuously revised up that by year end it has been upgraded to grow
On the earnings
at 25%. This robustfront, corporate
growth earnings
is mainly drivenforby KLCI was estimated
the upward revisionstoduring
grow the
at 15%
year in
early 2010 butand
the banking wasplantation
continuously revised
sectors. Theupbanking
that by year endenjoyed
sector it has been upgraded
strong loans to grow
growth,
at 25%. This robust
strengthening growth and
credit quality is mainly
rising driven by theincome,
non-interest upwardoffsetting
revisionsnetduring the margin
interest year in
the banking
pressure and plantation
in 2H2010 amid a 75 sectors. Thein banking
bps rise the policy sector
rate. enjoyed strong crude
In plantations, loans palm
growth,
oil
strengthening
average sellingcredit
price quality and rising non-interest
was ~RM2,750/t, income,
above our initial offsetting
RM2,400/t net interest
forecast margin
for 2010.
pressure in 2H2010 amid a 75 bps rise in the policy rate. In plantations, crude palm oil
average
Market selling
Outlook price was ~RM2,750/t, above our initial RM2,400/t forecast for 2010.
Market
We expect Outlook
the market to continue to trend up in 2011 due to liquidity flows from US’
USD600 billion QE2 especially in the 1st half. With only USD114b of US Treasuries
We expect
bought as atthe market2010,
mid-Dec to continue to trendpolicy
US’ monetary up in stimulus
2011 duewill to continue
liquidity to
flows from US’
be supportive
USD600 billion seeking
of fund outflows QE2 especially in the 1st half. With only USD114b of US Treasuries
higher returns.
bought as at mid-Dec 2010, US’ monetary policy stimulus will continue to be supportive
of
Onfund outflows front,
the domestic seeking
thehigher returns.
drivers for Malaysian equities in 2011 include (i) news-flow in
infrastructure spending and government land developments, (ii) corporate exercises and
On
GLICthedivestments,
domestic front,
andthe
(iii)drivers for Malaysian equities
PETRONAS-driven in 2011 include
capital expenditure. This(i) news-flow
will in
benefit the
infrastructure spending and
construction, property, government
building land
material, developments,
media and oil &(ii) gascorporate
players. exercises and
We are also
GLIC divestments,
positive andbeing
on the banks, (iii) PETRONAS-driven capital
a beneficiary of RM1.3 expenditure.
trillion This will
worth of private benefit the
sector
construction, property, building material, media and oil & gas players. We are also 2
positive on the banks, being a beneficiary of RM1.3 trillion worth of private sector
2
Kenanga
investments Syariah Growth
identified underFund
the ETP (2010-20). The consumer sector will also benefit
from an expanding economic pie.
investments identified under the ETP (2010-20). The consumer sector will also benefit
from an expanding
We expect corporateeconomic
earningspie. growth momentum to continue, but on a relatively slower
14-16% in 2011 due to a high base in 2010, and a further 8-10% in 2012. Earnings
We expect
growth corporate
in 2011 earnings
is driven by allgrowth momentum
sectors to continue,
except utilities but on a relatively
as a meaningful slower
tariff hike will
14-16% in 2011fordue
remain elusive to a amid
Tenaga high base
risinginfuel
2010, andOur
costs. a further 8-10% forecast
2012 growth in 2012.hasEarnings
upside
growth
potentialinfrom
2011further
is driven
ETPby all sectors except
implementations utilitiesthe
benefiting as banks,
a meaningful tariff hike
with a positive will
knock-
remain elusive
on impact on thefor Tenaga
other amid rising fuel costs. Our 2012 growth forecast has upside
sectors.
potential from further ETP implementations benefiting the banks, with a positive knock-
on impact
While on the other
we expect sectors.
the market to be higher in 2011, it will stay volatile throughout 2011 as
global issues play out. Concerns on the US will be cushioned by Obama’s tax-cut deal,
While we to
expected expect the market
be approved bytoearly-2011,
be higher inworries
2011, itonwill stay volatile
Eurozone’s throughout
sovereign 2011 as
worthiness,
global issues tensions,
geo-political play out. Concerns
and China’s on the US willgrowth
economic be cushioned by Obama’s
sustainability amid tax-cut deal,
inflationary
expected to be approved
pressure triggering further by early-2011,
interest worries
rate hikes. on Eurozone’s
Besides sovereign
China, rising worthiness,
interest rates in the
geo-political
other emergingtensions,
economies andwill
China’s economic
also draw capital growth
flows fromsustainability amid inflationary
Malaysian equities.
pressure triggering further interest rate hikes. Besides China, rising interest rates in the
other
Fund emerging
Categoryeconomies
and Type andwill Benchmark
also draw capital flows from Malaysian equities.
Fund Category and Type and Benchmark

Category : Islamic Equity
Type : Capital Growth
Category
Benchmark :: Islamic EquityMalaysia Emas Shariah Index (FBMS)
FTSE-Bursa
Type : Capital Growth
Benchmark : FTSE-Bursa Malaysia Emas Shariah Index (FBMS)
Investment Objective
Investment Objective
The provide unit holders with long term capital growth by investing principally in Malaysian
equities that complies with Shariah requirements.
The provide unit holders with long term capital growth by investing principally in Malaysian
equities that complies
Investment with Shariah requirements.
Strategy
Investment
The Fund willStrategy
actively invest in a diversified portfolio of Malaysian equity-related securities
that comply with Shariah requirements and have good growth potential.
The Fund will actively invest in a diversified portfolio of Malaysian equity-related securities
that
Unitcomply with Shariah
Holders’ Profilerequirements and have good growth potential.
Unit
As at Holders’ Profile
31 December 2010, the number of units of the Fund in circulation stood at 1,817,257
(include Manager’s stock) units out of an approved Fund size of 1 Billion units.
As at 31 December 2010, the number of units of the Fund in circulation stood at 1,817,257
Breakdown
(include of Unit Holdings
Manager’s by out
stock) units Sizeof an approved Fund size of 1 Billion units.
Breakdown of Unit Holdings by Unit

Size Holders Unit Holdings
Size of holdings Unit Holders %

Number Unit Holdings %
Units
5,000 and below 30 61.22 72,038 3.96
Size of holdings Number6 % Units %
5,001 - 10,000 12.24 45,468 2.50
5,000 and below
10,001-50,000 30
10 61.22
20.41 72,038
182,727 3.96
10.06
5,001 - 10,000
50,001-500,000 26 12.24
4.08 45,468
464,392 2.50
25.55
10,001-50,000
500,001 and above 10
1 20.41
2.04 182,727
1,052,632 10.06
57.92
50,001-500,000
Total 2
49 4.08
100.00 464,392
1,817,257 25.55
100.00
500,001 and above 1 2.04 1,052,632 57.92 3
Total 49 100.00 1,817,257 100.00 3

Holdings by the Manager and Related Parties
Holdings
Breakdownby of
theholdings
Managerbyand
theRelated
ManagerParties
and related parties as at 31 Dec 2010 is as follows:-
Breakdown of holdings by the Manager and related parties as at 31 Dec 2010 is as follows:-
No. of Units Held
Director of the Manager -*
Staff of the Manager No. of Units Held
50,616
Director
K&N of the Manager
Kenanga Holdings Berhad -*
1,052,632
Staff of the Manager
Total 50,616
1,103,248
K&N Kenanga Holdings Berhad
* exclude normal & EPF booking 1,052,632
Total 1,103,248
*Performance
exclude normal & EPF booking
From January to December 2010, the Fund has appreciated by 29.70*, compared with the
Performance
18.20%* increase in the FTSE-Bursa Malaysia Emas Shariah (FBMS) Index over the same
From January
period. to December
Since inception 2010,2002)
(18 Feb. the Fund has appreciated
the Fund by 29.70*,
has appreciated compared
by 157.74%* with the to the
compared
18.20%*
gain increase
of 92.43% in in
thethe FTSE-Bursa
FBMS Malaysia
index. The Fund’sEmas Shariah (FBMS)
has outperformed Index overfor
its benchmark thethe
same
period. Since
financial year inception (18 Feb.
under review since2002) the Fund has appreciated by 157.74%* compared to the
inception.
gain of 92.43% in the FBMS index. The Fund’s has outperformed its benchmark for the
*Source: Lipper
financial year IM review since inception.
under
Lipper IM as per Lipper Fund Table
*Source:Performance
Fund’s
Fund’s Performance as per Lipper Fund Table

1 year 3 years 5 years
31/12/09 - 31/12/10 31/12/07 – 31/12/10 31/12/05 – 31/12/10
(%) 1 year Rank (%) 3 years
Rank (%)5 yearsRank
31/12/09
Return - 31/12/10 31/12/07 – 31/12/10 31/12/05
Return Return – 31/12/10
Kenanga Syariah (%) Rank (%) Rank (%) Rank
29.70
Return 2/44 25.15
Return 2/37 115.25
Return 2/33
Growth Fund
Kenanga Syariah
FBMS (%) 29.7018.20 2/44 25.15 -4.51 2/37 115.25 2/33
Growth Fund 75.86
*Source:
FBMS (%)Lipper IM 18.20 -4.51 75.86
*Source: Lipper IM
For the financial year ended 31 December 2010, the Kenanga Syariah Growth Fund has
outperformed the FBMS Index for the one year, three years and five years period.
For the financial year ended 31 December 2010, the Kenanga Syariah Growth Fund has
outperformed the FBMS Index for the one year, three years and five years period.
Financial Highlights
Financial Highlights
Annual Total Return for Financial Year ended 31 December
Annual Total Return for Financial Year ended 31 December Since

2010 2009 2008 2007 2006
Inception
Kenanga Since
2010 2009 2008 2007 2006
Syariah Growth 29.70 30.42 -26.02 40.83 22.14 Inception
157.74
Kenanga
Fund (%)
Syariah
FBMSHA Growth
(%) 29.70
18.20 30.42
43.03 -26.02
-43.52 40.83
45.57 22.14
26.52 157.74
92.43
Fund (%)Lipper IM
*Source:
FBMSHA (%) 18.20 43.03 -43.52 45.57 26.52 92.43
*Source: Lipper IM
4
4
The Net Asset Value of the Fund is represented by the unit holders’ fund shown below:
The Net Asset Value of the Fund is represented

31 Dec 2010 by the 31
unitDec
holders’
2009 fund shown below:
%
Unit holders’ Fund (RM) (RM) Change
Unit holders’ Capital 31 Dec 2010
1,566,650 31 Dec536,920
2009 %
192
Unit holders’ Fund (RM) (RM) Change
Unrealised Reserves 668,146 319,356 109
Unit holders’ Capital 1,566,650 536,920 192
Realised Reserves 2,214,008 1,769,251 25
Unrealised Reserves 668,146 319,356 109
4,448,804 2,625,527 69
Realised Reserves 2,214,008 1,769,251 25
4,448,804
1,817,099 2,625,527
1,390,317 69
Units in Circulation
Net Asset Value per 1,817,099 1,390,317
Units(RM)
in Circulation 2.4483 1.8878
unit
Net Asset Value per
Performance 2.4483 1.8878
unit (RM) of KSGF on NAV-to-NAV basis from January 2010 to December 2010
Performance of KSGF on 31NAV-to-NAV
Dec 10 31
basis 09 January Returns
Decfrom 2010 to DecemberVs FBMS
2010
(RM) (RM) (%) (%)
NAV* 312.4483
Dec 10 31 Dec 09
1.8878 Returns
29.70 Vs11.50
FBMS
(RM) (RM) (%) (%)
FBMS 10,058.15 8,509.52 18.20
NAV* 2.4483 1.8878 29.70 11.50
* Based on adjusted NAV (all distributions reinvested)
FBMS 10,058.15 8,509.52 18.20
* Based on adjusted NAV (all distributions reinvested)
Performance Chart Since 1st Trading Day (18/02/2002 – 31/12/2010)

Kenanga Syariah Growth Fund vs. FTSE-Bursa Malaysia Emas Shariah Index
st
Performance
(FBMSHA) Chart Since 1 Trading Day (18/02/2002 – 31/12/2010)
Kenanga Syariah Growth Fund vs. FTSE-Bursa Malaysia Emas Shariah Index
(FBMSHA)
Source: Lipper IM
5
Source: Lipper IM
5

Portfolio of the Fund
Portfolio of the Fund

As at 31 December 2010, the Fund’s Shariah-compliant equity holdings comprised 22 counters
of various sectors in the Bursa Malaysia Securities Berhad with an investment cost of
As at 31 December
RM2,689,813 2010,
(market the RM3,357,959;
value: Fund’s Shariah-compliant equityRM668,146.12).
unrealised profit: holdings comprised 22 counters
of various sectors in the Bursa Malaysia Securities Berhad with an investment cost of
RM2,689,813 (market value: RM3,357,959; unrealised profit: RM668,146.12).
The following pie-chart shows the asset allocation of the Fund as at 31 December 2010
The following pie-chart shows the asset allocation of the Fund as at 31 December 2010
AssetKenanga
Allocation as at 31
Syariah December
Growth Fund2010
Asset Allocation as at 31 December 2010
Liquidity
24.53%
Liquidity
24.53%
Shariah-compliant Equity 75.47%
Shariah-compliant Equity 75.47%
Detailed Breakdown of Equity by Sector as at 31 December 2010
Detailed Breakdown of Equity byConsumer

Sector as at 31 December 2010
Liquidity Products
24.53% Consumer
13.93%
Liquidity Products Construction
24.53% 13.93% 5.59%
Construction
Plantation
5.59%
10.16%
Plantation
10.16%
Islamic REITS
4.02%
Islamic REITS Trading/Services
IPC
4.02% 36.46%
5.31% Trading/Services
IPC
36.46%
5.31%
Distribution
No distribution has been made during the period under review.
Distribution
No distribution has been made during the period under review.
6
6

PERFORMANCE DATA
PERFORMANCE DATA Data for the last 3 financial periods/years:

Summary of Performance
Summary of Performance Data for the last 3 financial periods/years:

31-12-10 31-12-09 31-12-08
Net Asset Value (RM’000 ) 4,449
31-12-10 2,625
31-12-09 2,004
31-12-08
(RM’000
Net Asset Value Per )
Unit (RM) 4,449
2.4483 2,625
1.8884 2,004
1.4430
Net
UnitsAsset Value Per (‘000
In Circulation Unit (RM)
units) 2.4483
1,817 1.8884
1,390 1.4430
1,388
Highest
Units In Net Asset Value
Circulation (‘000Per Unit
units) 1,817 1,390 1,388
2.4716 1.8878 1.9960
(RM)
Highest Net Asset Value Per Unit
Lowest Net Asset Value Per Unit 2.4716 1.8878 1.9960
(RM) 1.8809 1.4401 1.4086
(RM)
Lowest Net Asset Value Per Unit
Total Return (%)* 29.7012
1.8809 30.4180
1.4401 (26.0158)
1.4086
(RM)
Total Return
- Capital (%)*(%)
Growth 29.7012 30.4180 (26.0158)
Gross Income
- Capital GrowthDistribution
(%) (%) Nil
29.7012 Nil
30.4180 Nil
(26.0158)
Gross Distribution Per Unit (RM) Nil Nil Nil
- Gross Income Distribution (%) Nil Nil Nil
Net Distribution Per Unit (RM) Nil Nil Nil
Gross Distribution Per Unit (RM) Nil Nil Nil
Unit Split (Ratio) Nil Nil Nil
Net Distribution Per Unit (RM) Nil Nil Nil
Management Expenses Ratio (%) 1.97 2.73 2.87
Unit Split (Ratio) Nil Nil Nil
Portfolio Turnover
Management (%) Ratio (%)
Expenses 71
1.97 73
2.73 56
2.87
* Source: Lipper IM
Portfolio Turnover (%) 71 73 56
* Source: Lipper IM
7

Portfolio Composition as at 31 December 2010
Portfolio Composition as at 31 December 2010

Sectors 31-12-10 31-12-09 31-12-08
Sectors % of NAV
31-12-10 % of NAV
31-12-09 % of NAV
31-12-08
Main Board
% of NAV % of NAV % of NAV
Construction 5.59 - 6.2
Main Board
Consumer Products 13.93 18.3 4.1
Construction
Industrial Products 5.59 3.1- 6.2-
Consumer Products
Infrastructure Project Companies 13.93
5.31 18.3
5.3 4.1
5.1
Industrial Products
Plantation 10.16 3.1
5.2 7.0-
Infrastructure Project Companies
Properties 5.31 5.3- 5.1-
Plantation/ Services
Trading 10.16
36.46 5.2
43.2 7.0
17.8
Properties
Technology -- --
Trading / Services 36.46 43.2 17.8
Technology
Second Board - -
Trading / Services - -
Second Board
Trading Derivative
Islamic / Services Securities - -
Shariah-compliant Warrants - -
Islamic Derivative Securities
Shariah-compliant
Islamic REIT Warrants 4.02 5.3- 2.9-
Islamic REIT Shariah-compliant

Preference 4.02 5.3 2.9
Shares
Preference
Total quoted Shariah-compliant
Shariah-compliant 75.47 80.5 43.1
Shares
investment
Total quoted Shariah-compliant 75.47 80.5 43.1
Sukuk
investment - - -
Shariah-based
Sukuk Collective -- --
-
Investment Scheme
Shariah-based Collective - -
Cash at Banks
Investment / Receivables
Scheme 24.53 19.5 56.9-
Total 100.00 100.00 100.00
Cash at Banks / Receivables 24.53 19.5 56.9
Total
Note: 100.00 equities listed100.00
The Fund will invest mainly in diversified portfolio of Shariah-compliant 100.00
on the Bursa Malaysia Securities Berhad. It is
the Fund’s strategy to invest not more than 98% in Shariah-compliant Equities and in accordance with the Investment Policy of the
Investment Committee. However, should market conditions deem appropriate, significant cash or short-term Shariah-based deposits
Note: The Fund
considered will invest
advantageous mainly
to the Fundinmay
diversified
be held portfolio of Shariah-compliant
after consultation equitiesCommittee.
with the Investment listed on the Bursa Malaysia Securities Berhad. It is
the Fund’s strategy to invest not more than 98% in Shariah-compliant Equities and in accordance with the Investment Policy of the
Investment Committee. However, should market conditions deem appropriate, significant cash or short-term Shariah-based deposits
considered advantageous to the Fund may be held after consultation with the Investment Committee.
8
Policy on Stockbroking Rebates and Soft Commissions

Policy
It is the on Stockbroking
policy Rebates
of the Manager to creditand Soft Commissions
all stockbroking rebates on account of each Fund into
the accounts of the respective Funds. Soft commissions received from brokers will be retained
It
byisthe
theManager
policy ofasthe Manager
goods to creditsuch
and services, all stockbroking rebates ondata
as research materials, account of each Fund
and quotation into
services,
the accounts
computer of the respective
hardware Funds.
and software Soft commissions
incidental receivedmanagement
to the investment from brokersofwillthe be retained
Funds and
by the Manager
investment as publications,
related goods and services, such
which are of as research materials,
demonstrable data
benefit to theand
Unitquotation
Holders.services,
computer hardware and software incidental to the investment management of the Funds and
investment related publications, which are of demonstrable benefit to the Unit Holders.
During the financial period under review, soft commission was not received from any of its
brokers by virtue of transactions conducted by the Fund.
During the financial period under review, soft commission was not received from any of its
brokers by virtue of transactions conducted by the Fund.
INVESTORS ARE REMINDED THAT PAST PERFORMANCE IS NOT NECESSARILY

INDICATIVE OF FUTURE PERFORMANCE AND THAT UNIT PRICES AND INVESTMENT
INVESTORS
RETURNS MAYARE REMINDED THAT PAST PERFORMANCE IS NOT NECESSARILY
FLUCTUATE.
INDICATIVE OF FUTURE PERFORMANCE AND THAT UNIT PRICES AND INVESTMENT
RETURNS MAY FLUCTUATE.
9
Trustee’s Report
Trustee’s Report of Kenanga Syariah Growth Fund

To the Unitholders
To the Unitholders of Kenanga Syariah Growth Fund

We have acted as Trustee of Kenanga Syariah Growth Fund (“the Fund”) for the financial year
ended 31 December 2010. To the best of our knowledge, Kenanga Investors Berhad (“the
We have actedCompany”),
Management Kenanga
as Trustee ofhas operatedSyariah Growth
and managed the Fund (“the
Fund in Fund”) for
accordance thethe
with financial year-
following:
ended 31 December 2010. To the best of our knowledge, Kenanga Investors Berhad (“the
Management
(a) Company”),
limitations has on
imposed operated and managed
the investment the Fund
powers in accordance
of the Management with the following:
Company -
and the
Trustee under the Deed, the Securities Commission’s Guidelines on the Unit Trust Funds,
(a) limitations
the Capital imposed on the
Markets and investment
Services Act 2007,powers of the
and other Management
applicable laws; Company and the
Trustee under the Deed, the Securities Commission’s Guidelines on the Unit Trust Funds,
(b) the Capital Marketsisandcarried
valuation/pricing ServicesoutActin2007, and otherwith
accordance applicable laws; and any regulatory
the Deed
requirements; and
(b) valuation/pricing is carried out in accordance with the Deed and any regulatory
(c) requirements; and
creation and cancellation of units are carried out in accordance with the Deed and any
regulatory requirements.
(c) creation and cancellation of units are carried out in accordance with the Deed and any
regulatory requirements.
For HSBC (Malaysia) Trustee Berhad

(Company No.: 001281 - T)
For HSBC (Malaysia) Trustee Berhad
(Company No.: 001281 - T)
Manager, Trustee Operation
Manager, Trustee Operation
Kuala Lumpur, Malaysia

Date:
Date:
10
10
Shariah Adviser’s Report
Shariah Adviser’s Report


We have acted as the Shariah Adviser of Kenanga Syariah Growth Fund. Our responsibility is
to ensure that the procedures and processes employed by Kenanga Investors Berhad and that
We
the have acted of
provisions as the
the Deed
Shariah Adviser
dated of Kenanga
22 November 2004Syariah Growth Fund.
are in accordance Our responsibility
with Shariah principles. is
to ensure that the procedures and processes employed by Kenanga Investors Berhad and that
the provisions
In our opinion,of Kenanga
the Deed dated 22 November
Investors 2004managed
Berhad has are in accordance with Shariah
and administered principles.
Kenanga Syariah
Growth Fund in accordance with Shariah principles and complied with applicable guidelines,
In our opinion,
rulings Kenanga
and decisions Investors
issued Berhad has
by the Securities managed and
Commission administered
pertaining Kenanga
to Shariah mattersSyariah
for the
Growth
year endedFund in accordance
31 December 2010.with Shariah principles and complied with applicable guidelines,
rulings and decisions issued by the Securities Commission pertaining to Shariah matters for the
year ended 31we
In addition, December 2010.that the investment portfolio of Kenanga Syariah Growth Fund
also confirm
comprises securities which have been classified as Shariah-compliant by the Shariah Advisory
In addition,
Council weSecurities
of the also confirm that the investment
Commission. As for the portfolio Kenanga
securitiesofwhich are notSyariah
certifiedGrowth Fund
by the Shariah
comprises securitiesof which
Advisory Council have been
the Securities classified as
Commission, weShariah-compliant
have reviewed theby thesecurities
said Shariah and
Advisory
opine
Council ofsecurities
that these the Securities Commission.
are designated As for the securities which are not certified by the Shariah
as Shariah-compliant.
Advisory Council of the Securities Commission, we have reviewed the said securities and opine
that
For these securities
Islamic Banking areand
designated
FinanceasInstitute
Shariah-compliant.
Malaysia Sdn. Bhd.
For Islamic Banking and Finance Institute Malaysia Sdn. Bhd.
Mohd Nasir Ismail

Senior Shariah Fellow/Designated Person Responsible for Shariah Advisory
Mohd Nasir Ismail
Senior Shariah Fellow/Designated Person Responsible for Shariah Advisory
Date:
Date:
11
11

We, Datuk Syed Ahmad Alwee Alsree and Abdul Razak Bin Ahmad, being two of the
directors of Kenanga Investors Berhad, the Manager, do hereby state that in the opinion of the
We, Datukthe
Manager, Syed Ahmad Alwee
accompanying Alsree
financial and Abdul
statements Razak
set out Bin Ahmad,
on pages 15 to 50being two ofupthein
are drawn
directors of Kenanga
accordance Investors
with Financial Berhad,
Reporting the Manager,
Standards and thedoSecurities
hereby state that in the opinion
Commission’s of the
Guidelines on
Manager,
Unit TrusttheFunds
accompanying financial
in Malaysia so as tostatements set and
give a true out fair
on pages
view 15 to 50
of the are drawn
financial up inof
position
accordance with Financial
Kenanga Syariah GrowthReporting
Fund as Standards and the2010
at 31 December Securities
and ofCommission’s Guidelines and
its financial performance on
Unit
cash Trust
flows Funds
for the in Malaysia
year so as to give a true and fair view of the financial position of
then ended.
Kenanga Syariah Growth Fund as at 31 December 2010 and of its financial performance and
cash flows for the year then ended.
For and on behalf of the Manager,

Kenanga Investors Berhad
For and on behalf of the Manager,
Kenanga Investors Berhad
Datuk Syed Ahmad Alwee Alsree Abdul Razak Bin Ahmad
Datuk Syed Ahmad Alwee Alsree Abdul Razak Bin Ahmad

Date:
Date:
12
12
Independent Auditors’ Report to the Unitholders of

Independent
Report on theAuditors’financialReport
statements to the Unitholders of
We have audited the financial statements of Kenanga Syariah Growth Fund, which comprise
the statement of financial position as at 31 December 2010, statement of comprehensive
Report
income,on the financial
statement statements
of changes in equity and statement of cash flows for the year then ended, and
a summary of significant accounting policies and other explanatory notes, as set out on pages 6
We have audited the financial statements of Kenanga Syariah Growth Fund, which comprise
to 43.
the statement of financial position as at 31 December 2010, statement of comprehensive
income,
Manager’s statement of changes
and Trustee’s in equity and
responsibility for statement of cash
the financial flows for the year then ended, and
statements
a summary of significant accounting policies and other explanatory notes, as set out on pages 6
to 43.Manager of the Fund is responsible for the preparation and fair presentation of these
The
financial statements in accordance with Financial Reporting Standards and the Securities
Manager’s
Commission’s and Trustee’s
Guidelines responsibility
on Unit Trust for the financial
Funds statementsThis responsibility includes:
in Malaysia.
designing, implementing and maintaining internal control relevant to the preparation and fair
The Managerofoffinancial
presentation the Fundstatements
is responsible
that areforfree
the from
preparation
materialand fair presentation
misstatement, whether of due
theseto
financial statements
fraud or error; selectingin accordance
and applyingwith Financialaccounting
appropriate Reportingpolicies;
Standards and and the accounting
making Securities
Commission’s
estimates that are Guidelines
reasonable oninUnit Trust Funds inThe
the circumstances. Malaysia.
Trustee isThis responsibility
responsible includes:
for ensuring that
designing,
the Manager implementing and maintaining
maintains proper accountinginternal
and othercontrol relevant
records to the
as are preparation
necessary and fair
to enable fair
presentation
presentation of of financial statements
these financial that are free from material misstatement, whether due to
statements.
fraud or error; selecting and applying appropriate accounting policies; and making accounting
estimates
Auditors’that are reasonable in the circumstances. The Trustee is responsible for ensuring that
responsibility
the Manager maintains proper accounting and other records as are necessary to enable fair
presentation
Our responsibilityof these is financial
to expressstatements.
an opinion on these financial statements based on our audit. We
conducted our audit in accordance with approved standards on auditing in Malaysia. Those
Auditors’
standardsresponsibility
require that we comply with ethical requirements and plan and perform the audit to
obtain reasonable assurance whether the financial statements are free from material
Our responsibility is to express an opinion on these financial statements based on our audit. We
misstatement.
conducted our audit in accordance with approved standards on auditing in Malaysia. Those
standards
An audit require
involves thatperforming
we complyprocedures
with ethical to requirements
obtain audit and plan and
evidence aboutperform the auditand
the amounts to
obtain reasonable
disclosures assurancestatements.
in the financial whether the The financial
proceduresstatements are freeon from
selected depend material
our judgment,
misstatement.
including the assessment of risks of material misstatement of the financial statements, whether
due to fraud or error. In making those risk assessments, we consider internal control relevant to
An
the audit
Fund’sinvolves
preparation performing
and fair procedures
presentationtoof obtain audit evidence
the financial statementsabout the toamounts
in order and
design audit
disclosures
procedures in thatthe
arefinancial
appropriatestatements. The procedures
in the circumstances, selected
but not for thedepend
purpose onofour judgment,
expressing an
including
opinion on thetheassessment of risks
effectiveness of theof material misstatement
Fund’s internal of An
control. the audit
financial
alsostatements, whether
includes evaluating
due
the to fraud or error. In
appropriateness of making those riskpolicies
the accounting assessments,
used we andconsider internal control
the reasonableness of relevant
accountingto
the Fund’smade
estimates preparation
by the and fair presentation
Manager, as well as of the financial
evaluating statements
the overall in order to
presentation of design audit
the financial
procedures
statements.that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Fund’s internal control. An audit also includes evaluating
the
We appropriateness
believe that the audit of theevidence
accounting policies
we have used isand
obtained the reasonableness
sufficient and appropriate of to
accounting
provide a
estimates
basis for ourmade by opinion.
audit the Manager, as well as evaluating the overall presentation of the financial
statements. 13
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a
basis for our audit opinion.
13
Independent Auditors’ Report to the Unitholders of

Independent
Opinion Auditors’ Report to the Unitholders of
In our opinion, the financial statements have been properly drawn up in accordance with
Financial Reporting Standards and the Securities Commission’s Guidelines on Unit Trust
Opinion
Funds in Malaysia so as to give a true and fair view of the financial position of the Fund as at
31 December 2010 and of its financial performance, the changes in net assets value and the
In ourflows
cash opinion,
of thethe financial
Fund statements
for the year have been properly drawn up in accordance with
then ended.
Financial Reporting Standards and the Securities Commission’s Guidelines on Unit Trust
Funds
Otherinmatters
Malaysia so as to give a true and fair view of the financial position of the Fund as at
31 December 2010 and of its financial performance, the changes in net assets value and the
cash
Thisflows
reportofisthe Fund
made for the
solely yearUnitholders
to the then ended.of the Fund, as a body, and for no other purpose.
We do not assume responsibility to any other person for the content of this report.
Other matters
This report is made solely to the Unitholders of the Fund, as a body, and for no other purpose.
We do not assume responsibility to any other person for the content of this report.
ERNST & YOUNG WONG LAI WAH

AF: 0039 No.1956/04/11(J)
Chartered Accountants Chartered Accountant
ERNST & YOUNG WONG LAI WAH

AF: 0039 No.1956/04/11(J)
Chartered Accountants Chartered Accountant
Date :

Date :
14
14
Kenanga
StatementSyariah Growth Fund
of Comprehensive Income
for the year ended 31 December 2010
Statement of Comprehensive Income
Note 2010 2009
RM RM
Note 2010 2009
INVESTMENT INCOME RM RM
INVESTMENT
Dividend income INCOME 80,290 58,806
Profit from Shariah-based deposits 13,290 10,894
Dividend income
Net gain/(loss) from Shariah-compliant investments: 80,290 58,806
-Profit from assets
financial Shariah-based deposits
at fair value through profit and 13,290 10,894
Netloss
gain/(loss) from Shariah-compliant investments:
(“FVTPL”) 411,320 (97,707)
-- financial assetsgain
net unrealised at fair
on value through
changes profit
in value of and
loss (“FVTPL”) investments held
Shariah-compliant 411,320
348,790 (97,707)
718,551
- net unrealised gain on changes in value of ––––––––– –––––––––
Shariah-compliant investments held 348,790
853,690 718,551
690,544
––––––––– –––––––––
EXPENSES 853,690 690,544
EXPENSES
Manager’s fee 3 44,661 34,740
Trustee’s fee 4 18,002 18,150
Manager’s fee
Auditors’ remuneration 3 44,661
2,200 34,740
2,200
Trustee’s fee fee and expenses
Administrative 4 18,002
(5,953) 18,150
8,203
Auditors’ remuneration 2,200
––––––––– 2,200
–––––––––
Administrative fee and expenses (5,953)
58,910 8,203
63,293
––––––––– –––––––––
Net income before tax 58,910
794,780 63,293
627,251
Net income
Income before tax
tax expense 5 794,780
(10,773) 627,251
(7,600)
––––––––– –––––––––
Income tax expense
Net income after tax 5 (10,773)
784,007 (7,600)
619,651
–––––––––
––––––––– –––––––––
–––––––––
Net
Totalincome after taxincome for the year
comprehensive 784,007
784,007 619,651
619,651
–––––––––
======== –––––––––
========
Total comprehensive income for the year 784,007 619,651
Net income after tax is made up as follows: ======== ========
Net
Net income
realised after tax is made up as follows:
income/(loss) 435,217 (98,900)
Net unrealised gain 348,790 718,551
Net realised income/(loss) 435,217
––––––––– (98,900)
–––––––––
Net unrealised gain 348,790
784,007 718,551
619,651
–––––––––
======== –––––––––
========
784,007 619,651
======== ========
The accompanying notes are an integral part of the financial statements.
The accompanying notes are an integral part of the financial statements. 15
15

Statement of Financial Position as at 31 December 2010

Note 2010 2009 1.1.2009
RM RM RM
ASSETS Note 2010 2009 1.1.2009
Note 2010
RM 2009
RM 1.1.2009
RM
ASSETS
Shariah-compliant investments 6 RM
3,357,959 RM
2,110,699 RM
862,426
ASSETS
Shariah-based deposits with licensed
Shariah-compliant investments
financial institutions 76 3,357,959
503,952 2,110,699
200,179 862,426
1,082,976
Shariah-compliant
Shariah-based
Receivables investments
deposits with licensed 6 3,357,959
964,713 2,110,699
87,971 862,426
4,418
Shariah-based
financial
Tax institutions with licensed
recoverable deposits 7 503,952
11,225 200,179
11,669 1,082,976
10,952
financial
Receivables
Cash institutions
at bank 7 503,952
964,713
624,864 200,179
87,971
244,687 1,082,976
4,418
124,767
Receivables
Tax recoverable 964,713
–––––––––
11,225 87,971
–––––––––
11,669 4,418
––––––––
10,952
Tax
TOTAL
Cash recoverable
ASSETS
at bank 11,225
5,462,713
624,864 11,669
2,655,205
244,687 10,952
2,085,539
124,767
Cash at bank 624,864
–––––––––
––––––––– 244,687
–––––––––
––––––––– 124,767
––––––––
––––––––
––––––––– ––––––––– ––––––––
TOTAL ASSETS 5,462,713 2,655,205 2,085,539
TOTAL ASSETS
LIABILITIES 5,462,713 2,655,205 2,085,539
––––––––– ––––––––– ––––––––
––––––––– ––––––––– ––––––––
Amount due to Trustee
LIABILITIES 1,529 1,529 1,381
LIABILITIES
Amount due to Manager 4,524 3,300 2,552
Other payables
Amount and accruals
due to Trustee 9,601
1,529 24,849
1,529 77,708
1,381
Amount due
Amount due to
due to Trustee
to Manager
Stockbroker 1,529
987,487 1,529- 1,381-
Amount 4,524 3,300 2,552
Amount due to Manager 4,524
––––––––– 3,300
––––––––– 2,552
––––––––
Other payables and accruals 9,601 24,849 77,708
Other
TOTAL payables and accruals
LIABILITIES 9,601
1,003,141 24,849
29,678- 77,708
81,641 -
Amount due to Stockbroker 987,487
Amount due to Stockbroker 987,487
––––––––– ––––––––– - –––––––– -
––––––––– ––––––––– ––––––––
––––––––– ––––––––– ––––––––
TOTAL LIABILITIES
TOTAL LIABILITIES
1,003,141
1,003,141
29,678
29,678
81,641
81,641
EQUITY ––––––––– ––––––––– ––––––––
––––––––– ––––––––– ––––––––
Unitholders’ capital
EQUITY 1,586,958 536,920 534,942
EQUITY
Retained earnings 2,872,614 2,088,607 1,468,956
Unitholders’ capital –––––––––
1,586,958 –––––––––
536,920 ––––––––
534,942
Unitholders’ capital
TOTAL earnings
EQUITY 9 1,586,958
4,459,572 536,920
2,625,527 534,942
2,003,898
Retained
Retained earnings 2,872,614
2,872,614 2,088,607
2,088,607 1,468,956
1,468,956
–––––––––
––––––––– –––––––––
––––––––– ––––––––
––––––––
TOTAL EQUITY AND LIABILITIES –––––––––
5,462,713 –––––––––
2,655,205 ––––––––
2,085,539
TOTAL
TOTAL EQUITY
EQUITY 99 4,459,572
4,459,572 2,625,527
2,625,527 2,003,898
2,003,898
========
––––––––– ========
––––––––– =======
––––––––
––––––––– ––––––––– ––––––––
TOTAL
TOTAL EQUITY
EQUITY AND
AND LIABILITIES
LIABILITIES 5,462,713
5,462,713 2,655,205
2,655,205 2,085,539
2,085,539
UNITS IN CIRCULATION 10 1,817,099
======== 1,390,317
======== 1,388,740
=======
========
======== ========
======== =======
=======
UNITS
UNITS IN
IN CIRCULATION
CIRCULATION 10
10 1,817,099
1,817,099 1,390,317
1,390,317 1,388,740
1,388,740
NAV PER UNIT (RM) 12 2.4542
======== 1.8884
======== 1.4443
=======
========
======== ========
======== =======
=======
NAV
NAV PER
PER UNIT
UNIT (RM)
(RM) 12
12 2.4542
2.4542 1.8884
1.8884 1.4443
1.4443
========
======== ========
======== =======
=======
The
The accompanying
accompanying notes
notes are an integral part of the financial
financial statements.
statements. 16
16

Unitholders’ Retained Total
capital earnings equity
Unitholders’
(Note 9) Retained
(Note 9) Total
capital
RM earnings
RM equity
RM
(Note 9) (Note 9)
At 1 January 2009 RM
534,942 RM
1,468,956 RM
2,003,898
Total comprehensive income for the year - 619,651 619,651
At 1 January
Creation 2009
of units 534,942
26,079 1,468,956- 2,003,898
26,079
Total comprehensive
Cancellation of units income for the year -
(24,298) 619,651- 619,651
(24,298)
Creation of units
Distribution equalisation 26,079
197 - 26,079
197
Cancellation of units (24,298)
––––––––– ––––––––- (24,298)
––––––––
Distribution equalisation
At 31 December 2009 197
536,920 2,088,607- 197
2,625,527
–––––––––
======== ––––––––
======= ––––––––
=======
At 31 December 2009 536,920 2,088,607 2,625,527
At 1 January 2010 ========
536,920 =======
2,088,607 =======
2,625,527
Total comprehensive income for the year - 784,007 784,007
At 1 January
Creation 2010
of units 536,920
1,388,216 2,088,607- 2,625,527
1,388,216
Total comprehensive
Cancellation of units income for the year -
(185,323) 784,007- 784,007
(185,323)
Creation of units
Distribution equalisation 1,388,216
(152,855) - 1,388,216
(152,855)
Cancellation of units (185,323)
––––––––– ––––––––- (185,323)
––––––––
Distribution equalisation
At 31 December 2010 (152,855)
1,586,958 2,872,614- (152,855)
4,459,572
–––––––––
======== ––––––––
======= ––––––––
=======
At 31 December 2010 1,586,958 2,872,614 4,459,572
======== ======= =======


Note 2010 2009
RM RM
CASH FLOWS FROM OPERATING Note 2010 2009
AND INVESTING ACTIVITIES RM RM
CASH FLOWS FROM OPERATING
AND INVESTING
Proceeds from disposalACTIVITIES
of Shariah-compliant investments 1,867,843 1,253,781
Purchase of Shariah-compliant investments (1,367,505) (1,966,973)
Proceeds
Net fromreceived
dividend disposal of Shariah-compliant investments 1,867,843
69,012 1,253,781
51,223
Purchase
Profit of Shariah-based
from Shariah-compliant investments
deposits received (1,367,505)
13,148 (1,966,973)
12,368
Net dividend
Manager’s feereceived
paid 69,012
(43,437) 51,223
(33,991)
Profit from
Trustee’s feeShariah-based
paid deposits received 13,148
(18,002) 12,368
(18,002)
Manager’s
Payment forfee paidfees and expenses
other (43,437)
(11,499) (33,991)
(63,261)
Trustee’s fee paid (18,002)
––––––––– (18,002)
–––––––––
Payment for other fees
Net cash generated and expenses
from/(used in) operating and (11,499) (63,261)
investing activities –––––––––
509,560 –––––––––
(764,855)
Net cash generated from/(used in) operating and ––––––––– –––––––––
investing activities 509,560 (764,855)
CASH FLOWS FROM FINANCING ––––––––– –––––––––
ACTIVITIES
CASH FLOWS FROM FINANCING
ACTIVITIES
Cash received from units created 224,143 27,841
Cash paid on units cancelled (49,753) (25,863)
Cash received from units created 224,143
––––––––– 27,841
–––––––––
Cash paidgenerated
Net cash on units cancelled
from financing activities (49,753)
174,390 (25,863)
1,978
––––––––– –––––––––
Net
NETcash generated from financing activities
INCREASE/(DECREASE) IN CASH 174,390 1,978
AND CASH EQUIVALENTS –––––––––
683,950 –––––––––
(762,877)
NET INCREASE/(DECREASE) IN CASH
AND AND
CASH CASHCASHEQUIVALENTS
EQUIVALENTS AT 683,950 (762,877)
THE BEGINNING OF THE YEAR 444,866 1,207,743
CASH AND CASH EQUIVALENTS AT ––––––––– –––––––––
THE BEGINNING
CASH OF THE YEAR AT
AND CASH EQUIVALENTS 444,866 1,207,743
THE END OF THE YEAR –––––––––
1,128,816 –––––––––
444,866
CASH AND CASH EQUIVALENTS AT ======== ========
THE END OF THE YEAR 1,128,816 444,866
Cash and cash equivalents comprise: ======== ========
Cash and cash equivalents comprise:

at bank 624,864 200,179
Cash at bank deposits with financial institutions

Shariah-based 624,864
503,952 200,179
244,687
––––––––– –––––––––
Shariah-based deposits with financial institutions 503,952
1,128,816 244,687
444,866
–––––––––
======== –––––––––
========
1,128,816 444,866
========
The accompanying notes are an integral part of the financial statements. ========
18
The accompanying notes are an integral part of the financial statements.
18

Notes to the Financial Statements - 31 December 2010

1. The Fund, the Manager and their principal activities
1. The Fund,Syariah
Kenanga the Manager
Growthand Fund their
(theprincipal
“Fund”) activities
was constituted pursuant to a Deed dated 8
January 2002, Supplemental Deed dated 3 November 2004, Second Supplemental Deed
Kenanga
dated 18Syariah
April Growth Fund (the
2005, Third “Fund”) was
Supplemental Deedconstituted
dated pursuant
13 Januaryto a 2006,
Deed dated
Fourth8
January 2002, Deed
Supplemental Supplemental Deed2007
dated 9 July datedand
3 November
Supplemental2004, Second
Master DeedSupplemental Deed
dated 13 October
dated
2010 18 madeApril 2005, Kenanga
between Third Supplemental
Investors BerhadDeed (formerly
dated 13 known
Januaryas2006,CMSFourth
Trust
Supplemental Deed dated
Management Berhad) (the 9”Manager”),
July 2007 and HSBC Supplemental
(Malaysia) Master
TrusteeDeed dated
Berhad, (the13”Trustee”)
October
2010
and themade between
registered holders Kenanga Investors Berhad (formerly known as CMS Trust
of the Fund.
Management Berhad) (the ”Manager”), HSBC (Malaysia) Trustee Berhad, (the ”Trustee”)
and
Thethe registered
Fund’s holders
activities of be
shall theconducted
Fund. strictly in accordance with requirements of the
Shariah and regulatory policies and the Shariah Adviser will advise on the selection of
The Fund’s activities
investments from time shalltobetime.
conducted strictly inobjective
The primary accordance
of with requirements
the Fund of the
is to provide
Shariah and with
Unitholders regulatory policies
long-term and growth
capital the Shariah Adviserprincipally
by investing will adviseinonShariah-compliant
the selection of
investments
equities. Thefrom
Fund was timelaunched
to time.onThe primary2002
29 January objective
and willofcontinue
the Fund is to provide
its operations until
Unitholders
determined by with long-term
events capital
specified under growth
Articleby13investing principally in Shariah-compliant
of the Deed.
equities. The Fund was launched on 29 January 2002 and will continue its operations until
determined
The Manager by isevents specified
a subsidiary under Article
company 13 of the
of Kenanga Deed. Bank Berhad which itself is
Investment
a wholly-owned subsidiary company of K & N Kenanga Holdings Berhad. Both
The Manager
companies areis incorporated
a subsidiary company
in Malaysia. of Kenanga Investment
The principal BankofBerhad
activities which are
the Manager itselfunit
is
atrusts
wholly-owned
managementsubsidiary company of K & N Kenanga Holdings Berhad. Both
and fund management.
companies are incorporated in Malaysia. The principal activities of the Manager are unit
trusts management
The financial and fundwere
statements management.
authorised for issue by the Board of Directors of the
Manager in accordance with a resolution of the directors on 23rd February 2011
The financial statements were authorised for issue by the Board of Directors of the
2. Manager
Significantin accounting
accordancepolicies with a resolution of the directors on 23rd February 2011
2. Significant
2.1 accounting
Basis policies
of preparation
2.1 Basis of preparation

The financial statements of the Fund have been prepared on in accordance with
Financial Reporting Standards (“FRS”) and the Securities Commission’s
The financial
Guidelines onstatements
Unit Trust of the in
Funds Fund have been prepared on in accordance with
Malaysia.
Financial Reporting Standards (“FRS”) and the Securities Commission’s
Guidelines on Unit
The financial Trust Funds
statements of theinFund
Malaysia.
have prepared on the historical cost basis,
except as disclosed in the accounting policies below and are presented in Ringgit
The financial
Malaysia statements of the Fund have prepared on the historical cost basis,
(“RM”).
except as disclosed in the accounting policies below and are presented in Ringgit
Malaysia (“RM”).
19
19


2. Significant accounting policies (contd.)
2. Significant
2.2 accounting
Changes policies (contd.)
in accounting policies
2.2 Changes in accounting

The accounting policiespolicies
adopted are consistent with those of the previous
financial year, except for the adoption of new and revised FRSs and IC
Interpretations
The accountingwhich are adopted
policies effective are
for consistent
financial years
withbeginning
those of ontheorprevious
after 1
January 2010.
financial year, Except
except asfordiscussed below, of
the adoption these
new new
andandrevised
revisedFRSs
FRSs and IC IC
Interpretations which
Interpretations do notaregive rise toforany
effective significant
financial years effects on on
beginning the orfinancial
after 1
statements
January of the
2010. Fund.as discussed below, these new and revised FRSs and IC
Except
Interpretations do not give rise to any significant effects on the financial
FRS 7 Financial
statements Instruments: Disclosures
of the Fund.
Prior7to
FRS 1 JanuaryInstruments:
Financial 2010, information about financial instruments was disclosed in
Disclosures
accordance with the requirements of FRS 132 Financial Instruments: Disclosure
and Presentation.
Prior to 1 January 2010,FRS information
7 introduces about
new disclosures to improve was
financial instruments the information
disclosed in
about financial
accordance with the instruments.
requirementsIt ofrequires
FRS 132theFinancial
disclosure of qualitative
Instruments: and
Disclosure
quantitative
and information
Presentation. about exposure
FRS 7 introduces to risksto improve
new disclosures arising from financial
the information
instruments,
about including
financial specifiedItminimum
instruments. requires disclosures about credit
the disclosure risk, liquidity
of qualitative and
risk and market
quantitative risk, including
information sensitivity
about exposureanalysis to market
to risks risk. from financial
arising
instruments, including specified minimum disclosures about credit risk, liquidity
Theand
risk Fund has applied
market FRS 7 sensitivity
risk, including prospectively in accordance
analysis to market with
risk. the transitional
provisions. Hence, the new disclosures have not been applied to the
comparatives.
The The new
Fund has applied FRSdisclosures are included
7 prospectively throughout
in accordance thetransitional
with the financial
statements for
provisions. the yearthe
Hence, ended
new31 December
disclosures2010.have not been applied to the
comparatives. The new disclosures are included throughout the financial
FRS 8 Operating
statements for the Segments
year ended 31 December 2010.
FRS8 8,
FRS SegmentsFRS 114 Segment Reporting, requires disclosure of
which replaces
Operating
information about the Fund's operating segments, based on information about the
components
FRS of the
8, which entity FRS
replaces that is114
available
Segmentto the chief operating
Reporting, requiresdecision maker
disclosure of
for the purposes of allocating resources to the segments and assessing
information about the Fund's operating segments, based on information about their
the
performance,ofand
components the replaces theis requirement
entity that available to of
thethe Fund
chief to determine
operating decisionprimary
maker
(business) and secondary (geographical) reporting segments.
for the purposes of allocating resources to the segments and assessing their
performance, and replaces the requirement of the Fund to determine primary
For management purposes, the Fund is managed by a single portfolio, Shariah-
(business) and secondary (geographical) reporting segments.
compliant equity securities. Adoption of the standard did not affect the financial
statements of the Fund.
For management purposes, the Fund is managed by a single portfolio, Shariah-
compliant equity securities. Adoption of the standard did not affect the financial
statements of the Fund.
20
20


2. 2.2 Changes
Significant in accounting
accounting policies (contd.)
policies (contd.)
2.2 Changes
FRS 101 in accountingofpolicies
Presentation (contd.)
Financial Statements (Revised)
FRS
The 101 Presentation
revised FRS 101 of Financialchanges
introduces Statements
in the(Revised)
presentation and disclosures of
financial statements. The revised standard separates owner and non-owner
changes
The revisedin equity.
FRS 101 Theintroduces
statementchanges
of changes
in thein presentation
equity includes andonly details of
disclosures of
transactions
financial with owners,
statements. The with all non-owner
revised changes inowner
standard separates equity and
presented as a
non-owner
single line.
changes The standard
in equity. also introduces
The statement the statement
of changes in equity of includes
comprehensive income,
only details of
with all items
transactions of income
with owners,and withexpense recognised
all non-owner in profit
changes in or loss,presented
equity together with
as a
all other
single items
line. Theof incomealso
standard and introduces
expense recognised directly
the statement in equity, eitherincome,
of comprehensive in one
singleallstatement,
with or in two
items of income andlinked statements.
expense recognised TheinFund
profithas elected
or loss, to present
together with
thisother
all statement
items asof one single
income statement.
and expense recognised directly in equity, either in one
single statement, or in two linked statements. The Fund has elected to present
In addition,
this statementa as statement
one singleof statement.
financial position is required at the beginning of the
earliest comparative period following a change in accounting policy, the
correction
In addition,ofaan error or the
statement classification
of financial of items
position in the financial
is required statements.
at the beginning of the
earliest comparative period following a change in accounting policy, the
The revised
correction ofFRS 101 or
an error wastheadopted retrospectively
classification of itemsby in the
the Fund.
financial statements.
Amendments
The revised FRS to 101
FRSwas Financial
132adopted Instruments:
retrospectively Presentation
by the Fund. and FRS 101
Presentation of Financial Statements - Puttable Financial Instruments and
Obligations Arising
Amendments to FRS on 132
Liquidation
Financial Instruments: Presentation and FRS 101
Presentation of Financial Statements - Puttable Financial Instruments and
AmendmentsArising
Obligations to FRS 132 and FRS 101 became effective for annual periods
on Liquidation
beginning on or after 1 January 2010. The amendment to FRS 132 requires
entities to classify
Amendments to FRSputtable
132 financial
and FRSinstruments
101 became as equity if theforinstruments
effective have
annual periods
certain particular
beginning features
on or after and meet2010.
1 January specificThe
conditions.
amendment Thetoamendments to FRS
FRS 132 requires
101 require
entities disclosure
to classify of financial
puttable certain information
instruments relating
as equitytoif puttable instruments
the instruments have
classified
certain as equity.
particular features and meet specific conditions. The amendments to FRS
101 require disclosure of certain information relating to puttable instruments
The net assets
classified value (“NAV”) attributable to Unitholders has the features and
as equity.
meets the conditions for classification as Shariah-compliant equity instruments.
Consequently, upon adoption of the Amendments to FRS 132, the NAV
The net assets value (“NAV”) attributable to Unitholders has the features and
attributable to Unitholders amounting to RM4,459,572 (2009: RM2,625,527;
meets the conditions for classification as Shariah-compliant equity instruments.
1.1.2009: RM2,003,898) is reclassified from financial liabilities to equity.
Consequently, upon adoption of the Amendments to FRS 132, the NAV
Distributions made by the Fund are recognised as dividends in equity in the
attributable to Unitholders amounting to RM4,459,572 (2009: RM2,625,527;
period in which they are declared.
1.1.2009: RM2,003,898) is reclassified from financial liabilities to equity.
Distributions made by the Fund are recognised as dividends in equity in the
period in which they are declared.
21
21
Kenanga Syariah
Notes to the Growth
Financial Fund - 31 December 2010
Statements

2. Significant
2.2 accounting
Changes policies (contd.)
in accounting policies (contd.)
2.2 Changes
FRS 139 in accounting
Financial policies Recognition
Instruments: (contd.) and Measurement
FRS
FRS139139Financial Instruments:
establishes principles Recognition
for recognisingandand
Measurement
measuring financial assets,
financial liabilities and some contracts to buy and sell non-financial items. The
FRS
Fund139has establishes
adopted FRS principles for recognising
139 prospectively and measuring
on 1 January financial assets,
2010 in accordance with
financial liabilities
the transitional and someThe
provisions. contracts
detailstoofbuy
theand sell non-financial
changes items.
in accounting The
policies
Fund hasfrom
arising adopted FRS 139
the adoption of prospectively on 1 January
FRS 139 are discussed 2010 in accordance with
below:
the transitional provisions. The details of the changes in accounting policies
arising from the adoption
• Shariah-compliant of FRS
equity 139 are discussed below:
instruments
•Prior to 1 January 2010,

Shariah-compliant equitytheinstruments
Fund’s investments in quoted Shariah-compliant
equity instruments were carried at the last done market price quoted on Bursa
Malaysia
Prior to 1 asJanuary
at the reporting
2010, thedate. The investments
Fund’s fair value adjustments
in quoted on the investments
Shariah-compliant
were recognised
equity instruments in were
profit carried
or loss. at the last done market price quoted on Bursa
Malaysia as at the reporting date. The fair value adjustments on the investments
Uponrecognised
were the adoption of FRS
in profit 139, these investments are classified on 1 January
or loss.
2010 as financial instruments at FVTPL and are stated at fair values. The
determination
Upon of fair
the adoption values
of FRS 139,of these
Shariah-compliant
investments areequity instruments
classified is as
on 1 January
described
2010 in Noteinstruments
as financial 23. The classification
at FVTPL andof are these investments
stated as financial
at fair values. The
instruments at FVTPL
determination of fair did not affect
values the financial statements
of Shariah-compliant equityof instruments
the Fund. is as
described in Note 23. The classification of these investments as financial
2.3 Standards and
instruments interpretations
at FVTPL issued
did not affect thebut not yetstatements
financial effective of the Fund.
2.3 At the dateand

Standards of authorisation of these
interpretations issuedfinancial
but notstatements, the following new FRS
yet effective
and Interpretations, and amendments to certain Standards and Interpretations
were
At theissued
date ofbut not yet effective
authorisation andfinancial
of these have notstatements,
been applied
the by the Fund,
following newwhich
FRS
are: Interpretations, and amendments to certain Standards and Interpretations
and
were issuedforbut
Effective not yet periods
financial effectivebeginning
and have on
notorbeen applied
after 1 Marchby the
2010Fund, which
are:
 Amendments to FRS 132: Classification of Rights Issues
Effective for financial periods beginning on or after 1 March 2010
Effective for financial periods beginning on or after 1 July 2010
 Amendments to FRS 132: Classification of Rights Issues
 FRS 1: First-time Adoption of Financial Reporting Standards
Effective
 FRS 3: for financial
Business periods beginning
Combinations (revised)on or after 1 July 2010
FRS 127: Consolidated and Separate Financial Statements (amended)
 FRS 1: First-time Adoption of Financial Reporting Standards
 Amendments to FRS 2: Share-based Payment
 FRS 3: Business Combinations (revised)
 Amendments to FRS 5: Non-current Assets Held for Sale and Discontinued
 FRS 127: Consolidated and Separate Financial Statements (amended)
Operations
 Amendments to FRS 2: Share-based Payment
 Amendments to FRS 138: Intangible Assets
 Amendments to FRS 5: Non-current Assets Held for Sale and Discontinued
 Amendments to IC Interpretation 9: Reassessment of Embedded Derivatives
Operations
 IC Interpretation 12: Service Concession Arrangements
 Amendments to FRS 138: Intangible Assets
 IC Interpretation 16: Hedges of a Net Investment in a Foreign Operation
 Amendments to IC Interpretation 9: Reassessment of Embedded Derivatives
 IC Interpretation 17: Distributions of Non-cash Assets to Owners
 IC Interpretation 12: Service Concession Arrangements 22
 IC Interpretation 16: Hedges of a Net Investment in a Foreign Operation
 IC Interpretation 17: Distributions of Non-cash Assets to Owners
22


2. Significant
2.3 accounting
Standards and policies (contd.) issued but not yet effective
interpretations
2.3 Effective for

Standards andfinancial periods beginning
interpretations issued buton
notoryet
after 30 August 2010
effective
 Amendment
Effective to IC Interpretation
for financial 15: Agreements
periods beginning for30
on or after theAugust
Construction
2010
of Real Estate
 Amendment to IC Interpretation 15: Agreements for the Construction
Effective
of Realfor financial periods beginning on or after 1 January 2011
Estate
 Amendments
Effective to FRS
for financial 1: Limited
periods Exemption
beginning on orfrom
afterComparative FRS 7
1 January 2011
Disclosures for First-time Adopters
Amendments to
 Amendments to FRS
FRS 1:1: Limited
Additional Exemptions
Exemption fromforComparative
First-time Adopters
FRS 7
Amendments
 Disclosures fortoFirst-time
FRS 2: Group Cash-settled Share-based Payment
Adopters
Transactionsto FRS 1: Additional Exemptions for First-time Adopters
 Amendments
Amendments to
 Amendments to FRS
FRS 2:7: Group
Improving Disclosures
Cash-settled about Financial
Share-based PaymentInstruments
 Amendments
Transactionsto FRSs ‘Improvements to FRSs (2010)
IC Interpretation
 Amendments 4: Determining
to FRS 7: ImprovingWhether an Arrangement
Disclosures contains
about Financial a Lease
Instruments
IC Interpretation
 Amendments 18: Transfers
to FRSs of Assets
‘Improvements from Customers
to FRSs (2010)
Technical
 IC Release
Interpretation 4:i-4: Shariah Compliant
Determining WhetherSale Contracts contains a Lease
an Arrangement
 IC Interpretation 18: Transfers of Assets from Customers
Effective for financial
Technical Release i-4:periods beginning
Shariah on or
Compliant after
Sale 1 July 2011
Contracts
 Amendments
Effective to IC periods
for financial interpretation 14: Prepayments
beginning on or after 1ofJuly
a Minimum
2011 Funding
Requirement
IC Interpretation
 Amendments to IC19:interpretation
Extinguishing14:Financial Liabilities
Prepayments with Equity
of a Minimum Funding
Instruments
Requirement
 IC Interpretation 19: Extinguishing Financial Liabilities with Equity
Effective for financial periods beginning on or after 1 January 2012
Instruments
 FRS 124: Related Party Disclosures
Effective for financial periods beginning on or after 1 January 2012
 IC Interpretation 15: Agreements for the Construction of Real Estate
 FRS 124: Related Party Disclosures
The new FRSs and Interpretations, and amendments to certain Standards and
 IC Interpretation 15: Agreements for the Construction of Real Estate
Interpretations above are expected to have no significant impact on the financial
statements of the Fund upon their initial application.
The new FRSs and Interpretations, and amendments to certain Standards and
Interpretations above are expected to have no significant impact on the financial
statements of the Fund upon their initial application.
23
23
2. Significant
2.4 accounting
Summary policies (contd.)
of significant accounting policies
2.4 Summary
(a) of significant
Financial assets accounting policies
(a) Financial
Financial assets
assets are recognised in the statement of financial position
when, and only when, the Fund become a party to the contractual
Financial
provisionsassets are recognised
of the financial in the statement of financial position
instrument.
when, and only when, the Fund become a party to the contractual
provisions of theassets
When financial financial
are instrument.
recognised initially, they are measured at fair
value, plus, in the case of financial assets not at fair value through profit
or loss,financial
When directly attributable transaction initially,
assets are recognised costs. they are measured at fair
value, plus, in the case of financial assets not at fair value through profit
The
or Fund
loss, determines
directly the classification
attributable of its financial assets at initial
transaction costs.
recognition, and the categories include financial assets at fair value
through
The Fund profit or loss and
determines thereceivables.
classification of its financial assets at initial
recognition, and the categories include financial assets at fair value
(i)
through Financial assets
profit or loss andatreceivables.
FVTPL
(i) Financial assets

Financial assetsare classified as financial assets at FVTPL if they
at FVTPL
are held for trading or are designated as such upon initial
recognition.
Financial assetsFinancial assets as
are classified held for trading
financial assets include
at FVTPLShariah-
if they
compliant
are held forequity
tradingsecurities and Shariah-based
or are designated as such upon collective
initial
investment schemes
recognition. Financialacquired
assets principally for the purpose
held for trading includeofShariah-
selling
in the near term.
compliant equity securities and Shariah-based collective
investment
Subsequentschemes
to initialacquired principally
recognition, for assets
financial the purpose of selling
at FVTPL are
in the nearatterm.
measured fair value. Changes in the fair value of those financial
instruments are
Subsequent recorded
to initial in ‘Net gain
recognition, or loss on
financial financial
assets assets are
at FVTPL at
fair valueatthrough
measured profit
fair value. or loss’.
Changes in the Profit from
fair value Shariah-based
of those financial
deposits andare
instruments dividend
recorded revenue
in ‘Netelements of such
gain or loss instruments
on financial assetsareat
recorded separately in ‘Profit from Shariah-based
fair value through profit or loss’. Profit from Shariah-baseddeposits and
‘Gross dividend
deposits income’,
and dividend respectively.
revenue elementsExchange differences on
of such instruments are
financial assets
recorded at FVTPL
separately are not
in ‘Profit fromrecognised separately
Shariah-based in profit
deposits and
or loss dividend
‘Gross but are included
income’,in respectively.
net gains or Exchange
net losses on changes in
differences on
fair valueassets
financial of financial assetsare
at FVTPL at FVTPL.
not recognised separately in profit
(ii) or loss but are included in net gains or net losses on changes in
Receivables
fair value of financial assets at FVTPL.
Financial assets with fixed or determinable payments that are not
(ii) Receivables
quoted in an active market are classified as receivables. The Fund
includes short term receivables in this classification.
Financial assets with fixed or determinable payments that are not
quoted in an active market are classified as receivables. The Fund
Subsequent to initial recognition, receivables are measured at
includes short term receivables in this classification.
amortised cost using the effective profit method. Gains and losses
are recognised in profit or loss when the receivables are
Subsequent to initial recognition, receivables are measured at
derecognised or impaired, and through the amortisation process.
amortised cost using the effective profit method. Gains and losses
are recognised in profit or loss when the receivables are
derecognised or impaired, and through the amortisation process.24
24
Kenanga Syariah
Notes to the Growth
Statements

2. Significant
2.4 accounting
of significant accounting policies (contd.)
2.4 Summary of significant

((b) Impairment accounting
of financial policies (contd.)
assets
((b) The Fund assesses

Impairment at eachassets
of financial reporting date whether there is any objective
evidence that a financial asset is impaired
The Fund assesses at each reporting date whether there is any objective
Trade and
evidence that other receivables
a financial and other financial assets carried at
asset is impaired
amortised cost
Trade and other receivables and other financial assets carried at
To determine
amortised costwhether there is objective evidence that an impairment loss
on financial assets has been incurred, the Fund consider factors such as
thedetermine
To probabilitywhether
of insolvency or significant
there is objective financial
evidence difficulties
that an impairment of loss
the
debtor
on and default
financial assets orhas
significant delay inthe
been incurred, payments.
Fund consider factors such as
the probability of insolvency or significant financial difficulties of the
If any such
debtor evidence
and default or exists, the amount
significant delay inofpayments.
impairment loss is measured as
the difference between the asset’s carrying amount and the present value
Ifofany
estimated future cash
such evidence flows
exists, the discounted at the financial
amount of impairment lossasset’s original
is measured as
effective
the profitbetween
difference rate. Thetheimpairment loss is recognised
asset’s carrying amount andinthe profit or loss.
present value
of estimated future cash flows discounted at the financial asset’s original
The carrying
effective profitamount
rate. Theof impairment
the financialloss
asset is reduced by
is recognised the impairment
in profit or loss.
loss directly for all financial assets with the exception of trade
receivables,
The carryingwhere
amount theofcarrying amount
the financial is reduced
asset through
is reduced by thetheimpairment
use of an
allowance
loss account.
directly for allWhen a trade assets
financial receivable
withbecomes uncollectible,
the exception it is
of trade
written off against
receivables, where the
theallowance account.is reduced through the use of an
carrying amount
allowance account. When a trade receivable becomes uncollectible, it is
If in a off
written subsequent period,
against the the amount
allowance account.of the impairment loss decreases
and the decrease can be related objectively to an event occurring after the
Ifimpairment was recognised,
in a subsequent period, thetheamount
previously recognised
of the impairment
impairment loss is
loss decreases
and the decrease can be related objectively to an event occurring afternot
reversed to the extent that the carrying amount of the asset does the
exceed its amortised cost at the reversal date. The amount of reversal is
impairment was recognised, the previously recognised impairment loss is
recognised in profit or loss.
reversed to the extent that the carrying amount of the asset does not
exceed its amortised cost at the reversal date. The amount of reversal is
(c) Classification of realised and unrealised gains and losses
recognised in profit or loss.
Unrealised gains and losses comprise changes in the fair value of
(c) Classification of realised and unrealised gains and losses
financial instruments for the period and from reversal of prior period’s
unrealised gains and losses for financial instruments which were realised
Unrealised gains and losses comprise changes in the fair value of
(i.e. sold, redeemed or matured) in the reporting period.
financial instruments for the period and from reversal of prior period’s
unrealised gains and losses for financial instruments which were realised
Realised gains and losses on disposals of financial instruments classified
(i.e. sold,ofredeemed
as part ‘at fair or matured)
value in the
through reporting
profit period.
or loss’ are calculated using
weighted average method. They represent the difference between an
Realised gainsinitial
instrument’s and losses on disposals
carrying amount ofandfinancial instruments
disposal amount, classified
or cash
as part ofor‘at
payments fair value
receipts through
made on profit
derivative or loss’
contracts are calculated
(excluding using
payments or
weighted average method. They represent the difference
receipts on collateral margin accounts for such instruments). between an
instrument’s initial carrying amount and disposal amount, or cash 25
payments or receipts made on derivative contracts (excluding payments or
receipts on collateral margin accounts for such instruments).
25
Kenanga Syariah
Notes to the Growth
Statements

2. Significant
2.4 accounting
2.4 (d) Financial

Summary liabilities
(d) Financial liabilities

Financial liabilities are classified according to the substance of the
contractual arrangements entered into and the definitions of a financial
liability. liabilities are classified according to the substance of the
Financial
contractual arrangements entered into and the definitions of a financial
Financial liabilities, within the scope of FRS 139, are recognised in the
liability.
statement of financial position when, and only when, the Fund become a
party to the
Financial contractual
liabilities, provisions
within the scopeof of
theFRS
financial
139, instrument.
are recognisedFinancial
in the
liabilities of
statement arefinancial
classifiedposition
as either financial
when, liabilities
and only when,atthe
fairFund
valuebecome
througha
profittoorthe
party losscontractual
or other financial liabilities.
provisions of the financial instrument. Financial
liabilities are classified as either financial liabilities at fair value through
The Fund’s
profit or lossfinancial
or other liabilities which include trade and other payables are
financial liabilities.
recognised initially at fair value plus directly attributable transaction costs
and Fund’s
The subsequently
financialmeasured at which
liabilities amortised costtrade
include using
andthe effective
other profit
payables are
method. initially at fair value plus directly attributable transaction costs
recognised
and subsequently measured at amortised cost using the effective profit
A financial liability is derecognised when the obligation under the
method.
liability is extinguished. Gains and losses are recognised in profit or loss
Awhen the liabilities
financial liability are derecognised,when
is derecognised and through the amortisation
the obligation under the
process.is extinguished. Gains and losses are recognised in profit or loss
liability
when the liabilities are derecognised, and through the amortisation
(e) Unitholders’ capital
process.
(e) The Unitholders’

Unitholders’ capital of the Fund meet the definition of puttable
capital
instruments classified as Shariah-compliant equity instruments under the
revised
The FRS 132.capital
Unitholders’ Consequently, the Unitholders’
of the Fund capital which
meet the definition were
of puttable
previously classified as financial liabilities, have been reclassified as
instruments classified as Shariah-compliant equity instruments under the
Shariah-compliant equity instruments. Comparative figures have been
revised FRS 132. Consequently, the Unitholders’ capital which were
restated.
previously classified as financial liabilities, have been reclassified as
Shariah-compliant equity instruments. Comparative figures have been
Distribution equalisation represents the average distributable amount
restated.
included in the creation and cancellation prices of units. This amount is
either refunded to Unitholders by way of distribution and/or adjusted
Distribution equalisation represents the average distributable amount
accordingly when units are cancelled.
included in the creation and cancellation prices of units. This amount is
either refunded to Unitholders by way of distribution and/or adjusted
accordingly when units are cancelled.
26
26
Kenanga Syariah
Notes to the Growth
Statements

2. Significant
2.4 accounting
2.4 Summary
(f) of significant
Dividend accounting policies (contd.)
distribution
(f) Dividend distribution

Dividend distributions are at the discretion of the Fund. A dividend
distribution to the Fund’s Unitholders is accounted for as a deduction
from realised
Dividend reservesareexcept
distributions at the where dividend
discretion of theis Fund.
sourced out of
A dividend
distribution to
distribution equalisation
the Fund’swhich is accounted
Unitholders for as for
is accounted a deduction from
as a deduction
unitholders’
from realisedcapital. A proposed
reserves except dividend is recognised
where dividend as a liability
is sourced out inof
the period inequalisation
distribution which it is approved.
which is accounted for as a deduction from
unitholders’ capital. A proposed dividend is recognised as a liability in
(g) Cash
the and in
period cash equivalents
which it is approved.
(g) Cash and

Cash and cash
cashequivalents
equivalents comprise cash at bank and Shariah-based
deposits with licensed financial institutions which have an insignificant
risk ofand
Cash changes
cash inequivalents
value. comprise cash at bank and Shariah-based
deposits with licensed financial institutions which have an insignificant
(h) Income
risk of changes in value.
(h) Income is recognised to the extent that it is probable that the economic
Income
benefits will flow to the Fund and the income can be reliably measured.
Income isisrecognised
Income measured toat the
theextent
fair value
that it of consideration
is probable received
that the or
economic
receivable.
benefits will flow to the Fund and the income can be reliably measured.
Income is measured at the fair value of consideration received or
Dividend income is recognised when the Fund’s right to receive payment
receivable.
is established.
Dividend income is recognised when the Fund’s right to receive payment
isProfit from Shariah-based deposits and Shariah-compliant investments,
established.
which includes the accretion of discount and amortisation of premium on
sukuk,from
Profit is recognised usingdeposits
Shariah-based the effective profit method, oninvestments,
and Shariah-compliant an accrual
basis.
which includes the accretion of discount and amortisation of premium on
sukuk, is recognised using the effective profit method, on an accrual
(i) Income tax
basis.
Current tax assets and liabilities are measured at the amount expected to
(i) Income tax
be recovered from or paid to the tax authorities. The tax rates and tax
laws used to compute the amount are those that are enacted or
Current tax assets and liabilities are measured at the amount expected to
substantively enacted by the reporting date.
be recovered from or paid to the tax authorities. The tax rates and tax
laws used to compute the amount are those that are enacted or
Current taxes are recognised in profit or loss except to the extent that the
substantively enacted by the reporting date.
tax relates to items recognised outside profit or loss, either in other
comprehensive income or directly in equity.
Current taxes are recognised in profit or loss except to the extent that the
tax
No relates to tax
deferred itemsis recognised
recognised outside
as thereprofit
are or
no loss, eithertemporary
material in other
comprehensive
differences. income or directly in equity.
27
No deferred tax is recognised as there are no material temporary
differences.
27


2. Significant
2.4 accounting
2.4 (j) Segment

Summary reporting
(j) For management

Segment purposes, the Fund is managed by a single portfolio,
reporting
Shariah-compliant equity securities. The Investment Committee assumes
the role
For of chief operating
management purposes, decision
the Fundmaker, for performance
is managed by a singleassessment
portfolio,
purposes and to equity
Shariah-compliant make securities.
decisions The
aboutInvestment
resourcesCommittee
allocated assumes
to the
investment
the role of segment.
chief operating decision maker, for performance assessment
purposes and to make decisions about resources allocated to the
(k) Significantsegment.
investment accounting estimates and judgments
(k) The preparation

Significant of the Fund’s
accounting estimatesfinancial statements requires the Manager
and judgments
to make judgments, estimates and assumptions that affect the reported
amounts
The of revenues,
preparation of theexpenses, assets and
Fund’s financial liabilities,
statements and thethedisclosure
requires Manager
of make
to contingent liabilities
judgments, at the reporting
estimates date. However,
and assumptions uncertainty
that affect about
the reported
these assumptions
amounts of revenues, andexpenses,
estimatesassets
couldandresult in outcomes
liabilities, and thethat could
disclosure
require
of a material
contingent adjustment
liabilities to the carrying
at the reporting amount uncertainty
date. However, of the asset or
about
liability
these in the future.and estimates could result in outcomes that could
assumptions
require a material adjustment to the carrying amount of the asset or
No major
liability judgments
in the future. have been made by the Manager in applying the
Fund’s accounting policies. There are no key assumptions concerning the
future
No majorand judgments
other key have
sources of estimation
been made by the uncertainty
Manager atin the reporting
applying the
date, that have a significant risk of causing a material
Fund’s accounting policies. There are no key assumptions concerning adjustment to the
the
carrying
future amounts
and of assets
other key and of
sources liabilities within
estimation next year. at the reporting
uncertainty
date, that have a significant risk of causing a material adjustment to the
3. Manager’s feecarrying amounts of assets and liabilities within next year.
In accordance with Clause 13.1 of the Deed, the Manager will be entitled to an annual
3. Manager’s fee
management fee of 1.5% (2009:1.5%) accrued and computed daily based on the net asset
value of the Fund.
In accordance with Clause 13.1 of the Deed, the Manager will be entitled to an annual
management fee of 1.5% (2009:1.5%) accrued and computed daily based on the net asset
value of the Fund.
28
28
Kenanga Syariah
Notes to the Growth
Statements

4. Trustee’s fee
4. The Trustee’s
Trustee’s fee fee is computed at 0.08% (2009: 0.08%) per annum of the net assets value of
the Fund. This is calculated on a daily basis by dividing the net assets value of the Fund
The Trustee’s
before fee is
deducting thecomputed
Manager’s at fee
0.08%and(2009: 0.08%)
Trustee’s perthe
fee for annum of theday
particular net by
assets value of
the number
the Fund.in the
of days Thisyear
is calculated on a daily
and multiplying basiswith
the total by dividing
the rate ofthe
thenet assetsfee
annual value of theinFund
disclosed the
currentdeducting
before prospectus theofManager’s
the Fund. feeHowever, under Article
and Trustee’s fee for13.2 of the Deed
the particular dayofby
Trust
the and the
number
Supplemental
of Master
days in the year and Deed dated the
multiplying 13 October
total with2010, theofTrustee
the rate is entitled
the annual to a feeinnot
fee disclosed the
exceeding
current 0.10% (2009:
prospectus of the 0.10%) of the net under
Fund. However, assets Article
value of13.2
the ofFund,
the subject
Deed oftoTrust
a minimum
and the
of RM18,000 per
Supplemental annum
Master as follows:
Deed dated 13 October 2010, the Trustee is entitled to a fee not
exceeding 0.10% (2009: 0.10%) of the net assets value of the Fund, subject to a minimum
Net
of Asset Value
RM18,000 of the Fund
per annum as follows: Percentage
First RM50,000,000 0.10%
NextAsset
Net RM50,000,000
Value of the Fund 0.09%
Percentage
In excess
First of RM100,000,000
RM50,000,000 0.08%
0.10%
Next RM50,000,000 0.09%
5. Income tax expenses
In excess of RM100,000,000 0.08%
2010 2009
5. Income tax expenses RM RM
2010 2009
Current year tax 10,773 7,600
RM RM
–––––– ––––––
Tax expenses
Current year taxfor the year 10,773
10,773 7,600
7,600
=====
–––––– =====
––––––
Tax expenses for the year 10,773 7,600
Income tax is calculated at the Malaysian statutory tax rate of 25% (2009: 25%) of the
===== =====
estimated assessable income for the financial year.
Income tax is calculated at the Malaysian statutory tax rate of 25% (2009: 25%) of the
The Malaysian tax charge for the financial year is in relation to the taxable income
estimated assessable income for the financial year.
earned by the Fund after deducting tax allowable expenses. In accordance with
Schedule
The 6 of the
Malaysian taxIncome
chargeTax
for Act
the 1967, profit
financial income
year is in earned
relationbytothethe
Fund is exempted
taxable income
from tax.
earned by the Fund after deducting tax allowable expenses. In accordance with
Schedule 6 of theofIncome
A reconciliation incomeTax
taxAct 1967,applicable
expense profit income earned
to net by before
income the Fund is exempted
taxation at the
from tax. income tax rate to income tax expense at the effective income tax rate of the
statutory
Fund is as follows:
A reconciliation of income tax expense applicable to net income before taxation at the
2010 2009
statutory income tax rate to income tax expense at the effective income tax rate of the
RM RM
Fund is as follows:
Net income before taxation 2010
794,780 2009
627,251
RM
======= =======RM
Net income
Taxation at before taxation
Malaysian statutory rate of 25% (2009: 25%) 794,780
198,695 627,251
156,813
Income not subject to tax =======
(201,397) =======
(187,658)
Net realised loss not deductible for tax - 24,426
Taxation at Malaysian statutory rate of 25% (2009: 25%) 198,695 156,813
Expenses not deductible for tax purposes 2,206 1,346
Income not subject
Restriction to tax
on tax deductible expenses for unit trust funds (201,397)
11,269 (187,658)
12,673
Net realised loss not deductible for tax ––––––––- 24,426
–––––––––
Expenses not deductible
Tax expense for the year for tax purposes 2,206
10,773 1,346
7,600
Restriction on tax deductible expenses for unit trust funds 11,269
======= 12,673
========29
–––––––– –––––––––
Tax expense for the year 10,773 7,600
======= ========29


6. Shariah-compliant investments
6. Shariah-compliant
Financial assets heldinvestments
for trading as at 31 December 2010 are as detailed below:
Financial assets held for trading as at 31 December 2010 are as detailed below:
Fair % of
Name of counter Quantity Cost value NAV
RM Fair
RM % of
Name
Quotedof Shariah-compliant
counter equities Quantity Cost value NAV
RM RM
Quoted Shariah-compliant equities
Main Market
Main Market
Construction
IJM Corporation Berhad
Construction 18,000 97,239 112,140 2.52
Sunway Holdings Inc Berhad 61,000 114,764 136,640 3.07
IJM Corporation Berhad 18,000 97,239
–––––––– 112,140
––––––– 2.52
––––––
Sunway Holdings Inc Berhad 61,000 114,764
212,003 136,640
248,780 3.07
5.59
––––––––
–––––––– –––––––
––––––– ––––––
––––––
212,003 248,780 5.59
Consumer Products –––––––– ––––––– ––––––
Dutch LadyProducts
Consumer Milk Industries Berhad 12,800 147,814 224,512 5.05
Mamee Double Decker Berhad 30,400 108,164 102,144 2.30
Dutch
NestleLady Milk
(M’sia) Industries Berhad
Berhad 12,800
4,200 147,814
159,109 224,512
182,028 5.05
4.09
Mamee DoubleBerhad
OL Resources Decker Berhad 30,400
19,000 108,164
53,306 102,144
110,960 2.30
2.49
Nestle (M’sia) Berhad 4,200 159,109
––––––– 182,028
––––––– 4.09
––––––
OL Resources Berhad 19,000 53,306 110,960 2.49
468,393
––––––– 619,644
––––––– 13.93
––––––
–––––––– ––––––– ––––––
468,393 619,644 13.93
Infrastructure Project Companies –––––––– ––––––– ––––––
Digi.com Berhad
Infrastructure Project Companies 7,000 173,052 172,200 3.87
Lingkaran Trans Kota Berhad 18,000 39,453 64,080 1.44
Digi.com Berhad 7,000 173,052
––––––– 172,200
––––––– 3.87
––––––
Lingkaran Trans Kota Berhad 18,000 39,453
212,505 64,080
236,280 1.44
5.31
–––––––
––––––– –––––––
––––––– ––––––
––––––
212,505 236,280 5.31
Plantation ––––––– ––––––– ––––––
Batu Kawan Berhad
Plantation 13,400 171,374 226,460 5.09
United Plantations Berhad 13,200 186,911 225,720 5.07
Batu Kawan Berhad 13,400 171,374
––––––– 226,460
––––––– 5.09
––––––
United Plantations Berhad 13,200 186,911
358,285 225,720
452,180 5.07
10.16
–––––––
––––––– –––––––
––––––– ––––––
––––––
Islamic REITS 358,285 452,180 10.16
––––––– ––––––– ––––––
Axis Real
Islamic Estate Berhad
REITS 75,500 96,487 178,935 4.02
––––––– ––––––– ––––––
Axis Real Estate Berhad 75,500 96,487 178,935 4.02
––––––– ––––––– ––––––
30
30


6. Shariah-compliant investments (contd.)
Fair % of
6. Shariah-compliant
Name of counter investments (contd.)Quantity Cost value NAV
RM Fair
RM % of
Name of counter
Quoted Shariah-compliant equities Quantity Cost value NAV
RM RM
Quoted Shariah-compliant equities
Main Market
Main Market
Trading/Services
Axiata Group Berhad
Trading/Services 48,000 216,126 228,000 5.12
Dialog Group Berhad 125,000 171,311 223,750 5.03
Axiata
Faber Group Berhad 48,000
16,000 216,126
22,963 228,000
40,640 5.12
0.91
Dialog Group
Kencana BerhadBerhad
Petroleum 125,000
76,000 171,311
126,131 223,750
183,160 5.03
4.12
Faber
KFC Group Berhad
Holdings Berhad 16,000
28,000 22,963
48,984 40,640
106,960 0.91
2.40
Kencana Petroleum
KPJ Healthcare Berhad
Berhad 76,000
24,000 126,131
63,075 183,160
89,280 4.12
2.01
KFC Holdings
Petronas Berhad
Dagangan Berhad 28,000
15,200 48,984
158,662 106,960
177,840 2.40
4.00
KPJ
PLUSHealthcare Berhad
Expressways Berhad 24,000
49,000 63,075
218,182 89,280
221,480 2.01
4.98
Petronas Dagangan
QSR Brands Berhad
Berhad 15,200
16,000 158,662
44,689 177,840
80,960 4.00
1.82
PLUS
DayangExpressways Berhad Berhad
Enterprise Holdings 49,000
47,000 218,182
135,679 221,480
133,950 4.98
3.01
QSR Brands
Amway (M)Berhad
Holdings Berhad 16,000
16,400 44,689
136,338 80,960
136,120 1.82
3.06
Dayang Enterprise Holdings Berhad 47,000 135,679
–––––––– 133,950
–––––––– 3.01
––––––
Amway (M) Holdings Berhad 16,400 136,338
1,342,140 136,120
1,622,140 3.06
36.46
––––––––
–––––––– ––––––––
–––––––– ––––––
––––––
Total financial assets at FVTPL 1,342,140
2,689,813 1,622,140
3,357,959 36.46
75.47
––––––––
–––––––– ––––––––
–––––––– ––––––
––––––
Total financial assets at FVTPL 2,689,813 3,357,959 75.47
Excess of cost over fair value –––––––– ––––––––
668,146 ––––––
========
Excess of cost over fair value 668,146
. ========
7. Shariah-based deposits with licensed financial institutions
.
7. Shariah-based
These are deposits with
short-term licensed with:
placements financial institutions
As at
These are short-term placements with: 2010 2009 1.1.2009
RM RM AsRM
at
2010 2009 1.1.2009
Islamic banks RM
503,952 RM
200,179 RM
1,082,976
======= ======= =======
Islamic banks 503,952 200,179 1,082,976
The weighted average rate of return of the Fund ======= =======
during the year =======
is 2.18% (2009: 2.16%
per annum and the maturity of Shariah-based deposits of the Fund have an average
The weighted
maturity average
period rate (2009:
of 7 days of return of the Fund during the year is 2.18% (2009: 2.16%
8 days).
per annum and the maturity of Shariah-based deposits of the Fund have an average
maturity period of 7 days (2009: 8 days).
31
31
KenangaSyariah
Kenanga Syariah Growth
Growth Fund
Fund
Notestotothe
Notes theFinancial
Financial Statements
Statements --31
31December
December2010
2010
8. Shariah information of the Fund
8. Shariah information of the Fund
8. Shariah information
The Shariah Adviser of the Fundthat the investments portfolio of the Fund is Shariah-
confirmed
compliant,
The Shariahwhich
Advisercomprises:
confirmed that the investments portfolio of the Fund is Shariah-
The Shariahwhich
compliant, Adviser confirmed that the investments portfolio of the Fund is Shariah-
comprises:
compliant,
(a) which
Equity comprises:
securities listed in Bursa Malaysia which have been classified as Shariah-
(a) compliant
Equity by thelisted
securities Shariah Advisory
in Bursa Council
Malaysia whichofhave
the Securities Commission;
been classified as Shariah-
(a) Equity securities
compliant listed inAdvisory
by the Shariah Bursa Malaysia
Council which have beenCommission;
of the Securities classified as Shariah-
(b) compliant by the Shariah
Cash placements Advisory
and liquid assets Council
in local of the Securities
market, which areCommission;
placed in Shariah-
(b) Cash placements
compliant and liquid
investments assets
and/or in local market, which are placed in Shariah-
instruments.
(b) Cash placements
compliant and liquid
investments and/orassets in local market, which are placed in Shariah-
instruments.
9. compliant investments and/or instruments.
Total equity
9. Total equity As at
9. Total equity Note 2010 2009 As at
1.1.2009
Note 2010 2009
RM RM 1.1.2009 AsRMat
Note RM
2010 RM
2009 RM
1.1.2009
Unitholders’ capital 10 1,586,958 RM
1,586,958 RM
536,920 RM
534,942
Unitholders’ capital 10 536,920 534,942
Retained earnings
Retained earnings
Unitholders’
Realised capital
reserve 10 1,586,958 536,920 534,942
Realised reserve 1111 2,204,468
2,204,468 1,769,251
1,769,251 1,868,151
1,868,151
Retained
Unrealisedearnings
Shariah-compliant
Unrealised Shariah-compliant
Realised reserve
investment
investment reserve
reserve 11
1212 2,204,468
668,146
668,146 1,769,251 1,868,151
319,356 (399,195)
319,356 (399,195)
Unrealised Shariah-compliant ––––––––– –––––––––
––––––––– ––––––––– –––––––––
–––––––––
investment reserve 12 4,459,572
668,146 2,625,527
4,459,572 319,356 2,003,898
2,625,527 (399,195)
2,003,898
––––––––– –––––––––
======== ========
======== –––––––––
======== ================
4,459,572 2,625,527 2,003,898
10.
10. Unitholders’ capital
Unitholders’ capitaland
andunits circulation========
unitsinincirculation ======== ========
10. Unitholders’ capital and units 2010in circulation

2010 2009
2009 20082008
No.
No.ofofunits
units RMRM No.No.of of
units
units RMRMNo.No. of units
of units RM RM
2010 2009 2008
As at
As at 11 No. of units RM No. of units RM No. of units RM
January
January 1,390,317
1,390,317 536,920
536,920 1,388,740
1,388,740 534,942 534,942 1,428,809
1,428,809 604,440604,440
Creation
As at 1
Creation
of units
January 506,125 1,388,216
1,390,317 536,920 15,728
1,388,740 26,079
534,942 -
1,428,809 -
604,440
of units 506,125 1,388,216 15,728 26,079 - -
Creation –––––––– –––––––– ––––––––– –––––––– ––––––––– ––––––––
––––––––
1,896,442
––––––––
1,925,136
–––––––––
1,404,468
––––––––
561,021
–––––––––
1,428,809
––––––––
604,440
of units 506,125 1,388,216 15,728 26,079 - -
Cancellation 1,896,442 1,925,136 1,404,468 561,021 1,428,809 604,440
Cancellation –––––––– –––––––– ––––––––– –––––––– ––––––––– ––––––––
of units (79,343) (185,323) (14,151) (24,298) (40,069) (41,621)
of units 1,896,442
(79,343) 1,925,136
(185,323) 1,404,468
(14,151) 561,021
(24,298) 1,428,809
(40,069) 604,440
(41,621)
Distribution
Cancellation
Distribution
equalisation (152,855) - 197 - (27,877)
ofequalisation
units (79,343) ––––––––
–––––––– (185,323) (14,151)- ––––––––
(152,855) ––––––––– (24,298) (40,069)––––––––
197 ––––––––– - (41,621)
(27,877)
Distribution
As at 31 –––––––– –––––––– ––––––––– –––––––– ––––––––– ––––––––
equalisation
As at 31
December (152,855) 1,390,317 - 536,920197 1,388,740 - 534,942
1,817,099 1,586,958 (27,877)
December –––––––– ––––––––
1,817,099 =======
======= –––––––––
1,586,958 ======== ––––––––
1,390,317 ======= –––––––––
536,920 ======== ––––––––
1,388,740======= 534,942
As at 31 ======= ======= ======== ======= ======== =======
December
The approved 1,817,099 1,586,958
size of the Fund 1,390,317
is 200,000,000 536,920
units. As at 31 1,388,740
December 2010, the number 534,942
of
unitsapproved
The =======
yet to be issued
size ofwas =======
the198,182,901
Fund ========
(2009: units. As=======
198,609,683).
is 200,000,000 ========
at 31 December 2010, the32=======
number of
units yet to be issued was 198,182,901 (2009: 198,609,683).
The approved size of the Fund is 200,000,000 units. As at 31 December 2010, the number 32 of
units yet to be issued was 198,182,901 (2009: 198,609,683).
32
Kenanga Syariah
Notes to the Growth
Statements

11. Realised reserve
2010 2009 2008
11. Realised reserve RM RM RM
2010 2009 2008
At 1 January RM
1,769,251 RM
1,868,151 RM
1,745,038
Net income/(loss) after taxation 435,217 (98,900) 123,113
At 1 January 1,769,251
–––––––– 1,868,151
–––––––– 1,745,038
–––––––––
Net income/(loss)
At 31 December after taxation 435,217
2,204,468 (98,900)
1,769,251 123,113
1,868,151
––––––––
======= ––––––––
======= –––––––––
========
At 31 December 2,204,468 1,769,251 1,868,151
12. Unrealised Shariah-compliant investment=======
reserve ======= ========
12. Unrealised Shariah-compliant investment reserve

2010 2009 2008
RM RM RM
2010 2009 2008
At 1 January RM
319,356 RM
(399,195) RM
438,829
Net unrealised gain/(loss) 348,790 718,551 (838,024)
At 1 January 319,356
–––––––– (399,195)
–––––––– 438,829
–––––––––
Net unrealised
At 31 December gain/(loss) 348,790
668,146 718,551
319,356 (838,024)
(399,195)
––––––––
======= ––––––––
======= –––––––––
========
At 31 December 668,146 319,356 (399,195)
13. Net assets value per unit ======= ======= ========
13. Net
The assets value
net assets perper
value unit
unit has been calculated based on the Fund’s net assets value of
RM4,459,572 (2009: RM2,625,527; 2008: RM2,003,898 and on the number of units in
The net assets
circulation value per unit
of 1,817,099 has1,390,317;
(2009: been calculated
2008: based on theatFund’s
1,388,740) the datenetofassets value of
the Statement
RM4,459,572 (2009: RM2,625,527; 2008: RM2,003,898 and on the number of units in
of financial Position.
circulation of 1,817,099 (2009: 1,390,317; 2008: 1,388,740) at the date of the Statement
14. of financial
Units Position.
held by related parties
14. Units
Numberheld
of by related
Units parties
held by the Manager and related parties are as follows:-
Number of Units held by the Manager andNo related parties are

of Units Noasoffollows:-
Units No of Units
as at as at as at
No of Units
2010 No of Units
2009 No of Units
2008
Related Parties as at as at as at
Director of the Manager 2010- 2009
1,053 2008
1,053
Related Parties
Staff of the Manager 50,616 1,624 -
Director
K of the Manager
& N Kenanga Holdings Berhad 1,052,632- 1,053
1,052,632 1,053
1,052,632
Staff of the Manager 50,616
–––––––– 1,624
–––––––– –––––––––-
K & N Kenanga Holdings Berhad 1,052,632
1,103,248 1,052,632
1,055,309 1,052,632
1,053,685
––––––––
======= ––––––––
======= –––––––––
========
1,103,248 1,055,309 1,053,685
The abovementioned related parties are legal======= =======
owners of the units. ========
The abovementioned
Transactions related
undertaken withparties are legal
the related owners
parties wereofinthe
theunits.
normal course of the business
and had been established under terms no less no less favourable to the Fund than those on
Transactions
arm’s undertaken
length basis betweenwith the relatedparties.
independent parties were in the normal course of the business
and had been established under terms no less no less favourable to the Fund than those 33 on
arm’s length basis between independent parties.
33

15. Transactions with stockbrokers
15. Transactions with stockbrokers Percentage Brokerage

of total fees, stamp Percentage
Trading Percentage
trading Brokerage
duty and of total
value of value
total fees, stamp
clearing fee Percentage
fees
TradingRM trading % duty and RM of total%
value value clearing fee fees
CIMB Investment Bank Berhad 170,178
RM 5.34
% 436
RM 5.49%
AmInvestment Bank Berhad 188,685 5.92 472 5.94
CIMB Investment
Maybank Bank
Investment Berhad
Bank Berhad 170,178
560,766 5.34
17.60 436
1,530 5.49
19.26
AmInvestment Bank Berhad
Credit Suisse Securities Sdn Berhad 188,685212,338 5.92
6.67 472
549 5.94
6.92
Maybank Investment
OSK Investment BankBank Berhad
Berhad 560,766
224,372 17.60
7.04 1,530
572 19.26
7.20
Credit Suisse Securities
RHB Investment Sdn Berhad 212,338
Bank Berhad 927,685 6.67
29.12 549
2,129 6.92
26.81
OSK Investment
Macquarie Bank
(M) Sdn Berhad
Berhad 224,372
500,197 7.04
15.70 572
1,251 7.20
15.74
RHB Investment&Bank
KAF-Seagroatt Berhad
Campbell 927,685 29.12 2,129 26.81
Macquarie
Securities(M) Sdn
Sdn. Berhad
Berhad 500,197
401,618 15.70
12.61 1,251
1,004 15.74
12.64
KAF-Seagroatt & Campbell ––––––––– –––––– –––––– ––––––
Securities Sdn. Berhad 401,618
3,185,839 12.61
100.00 1,004
7,943 12.64
100.00
–––––––––
======== ––––––
===== ––––––
===== ––––––=====
3,185,839 100.00 7,943 100.00
The directors of Manager of the opinion that the transactions
======== ===== with===== the related=====
parties
have been entered into in the normal course of business and have been established on
The directors
terms of Managerthat
and conditions of the
are opinion that the transactions
not materially different from with that
the related partiesin
obtainable
have been entered
transactions with into in the parties.
unrelated normal course of business
The Manager andthe
is of have been established
opinion on
that the above
terms andhave
dealings conditions that are
been transacted notarm’s
on an materially different from that obtainable in
length basis.
transactions with unrelated parties. The Manager is of the opinion that the above
dealings have been transacted on an arm’s length basis.
34
34


16. Management expense ratio (“MER”)
16. Management
The MER of theexpense
Fund ratio
is the(“MER”)
ratio of the sum of fees and expenses incurred by the Fund
to the average net assets value of the Fund calculated on a daily basis. The fees and
The MER ofinclude
expenses the FundManager’s
is the ratio of the sum
fee, of fees fee,
Trustee’s and expenses
auditors’incurred by the Fund
remuneration and
toadministrative
the average net assets value
expenses. of financial
For the the Fundyear
calculated
ended 31 on December
a daily basis. The
2010, thefees
MER andof
expenses include
the Fund stood Manager’s
at 1.97% fee, Trustee’s
(2009: 2.73%) fee,follows:
calculated as auditors’ remuneration and
administrative expenses. For the financial year ended 31 December 2010, the MER of
the Fund stood at 1.97% (2009: 2.73%) calculated as follows: RM
A = Manager’s fee RM
44,661
B = Trustee’s fee 18,002
AC == Manager’s fee
Auditors’ remuneration 44,661
2,200
BD == Trustee’s fee fee and expenses
Administrative 18,002
(5,953)
CE == Auditors’ remuneration
Average net assets value of the Fund 2,200
2,982,894
D = Administrative fee and expenses (5,953)
EMER == Average
(A + B +net
C assets
+ D) xvalue
100 of the Fund 2,982,894
–––––––––––––
MER = (A + BE+ C + D) x 100
–––––––––––––
= E
RM 58,910 x 100
–––––––––––––
= RM
RM58,910 x 100
2,982,894
–––––––––––––
= RM
1.972,982,894
%
The average NAV= of the Fund

1.97 for
% the financial year ended 31 December 2010 was RM
2,982,894 (2009: RM 2,315,215).
The average NAV of the Fund for the financial year ended 31 December 2010 was RM
2,982,894 (2009: RM 2,315,215).
35
35


17. Portfolio turnover ratio (“PTR”)
17. The PTRturnover

Portfolio of the Fundratiois (“PTR”)
the ratio of the average of the acquisitions and disposals of the
Fund for the financial year to the average net assets value of the Fund calculated on a
The PTR
daily of the
basis. ForFund is the ratio
the financial yearofended
the average of the acquisitions
31 December andof
2010, the PTR disposals
the Fundofstood
the
Fund fortimes
at 0.71 the financial
(2009: 0.73yeartimes).
to the average net assets value of the Fund calculated on a
daily basis. For the financial year ended 31 December 2010, the PTR of the Fund stood
atThe
0.71PTR
timesof (2009:
the Fund0.73is calculated
times). as follows:
RM
The PTR of the Fund is calculated as follows:
Total acquisitions of the Fund 2,354,993
RM
Total disposals of the Fund 1,867,843
Total acquisitions
Average net assetsofvalue
the Fundof the Fund 2,354,993
2,982,894
Total disposals of the Fund 1,867,843
PTR net assets=value of the
Average (Total
Fundacquisitions + Total disposals) / 2 2,982,894
––––––––––––––––––––––––––––––
PTR = (Total acquisitions
Average net assets+value
Totalofdisposals)
the Fund/ 2
––––––––––––––––––––––––––––––
= RM 4,222,836
Average / 2 value of the Fund
net assets
––––––––––––
= RM RM 4,222,836
2,982,894/2
––––––––––––
= RM 0.71 times
2,982,894
The average NAV= of the Fund

0.71 for
times
the financial year ended 31 December 2010 was RM
2,982,894 (2009: RM 2,315,215).
The average NAV of the Fund for the financial year ended 31 December 2010 was RM
18. 2,982,894
Segment (2009: RM 2,315,215).
information
18. Segment information

The Manager and Investment Committee of the Fund are responsible for allocating
resources available to the fund in accordance with the overall investment strategies as
The Manager
set out and Investment
in the Investments Committee
Guidelines of theofFund.
the Fund are responsible for allocating
resources available to the fund in accordance with the overall investment strategies as
set
Foroutmanagement
in the Investments Guidelines
purposes, the Fundofistheorganised
Fund. into one main operating segment,
which invests in Shariah-compliant equity securities. The financial results from this
For management
segment purposes,
are equivalent to thethefinancial
Fund isstatements
organisedofinto one main
the Fund operating segment,
as a whole.
which invests in Shariah-compliant equity securities. The financial results from this
segment are equivalent to the financial statements of the Fund as a whole.
36
36


19. Financial instruments
19. Financial
(a) instrumentsof financial instruments
Classification
(a) Classification
With effect from of financial
1 January instruments
2010, the Fund’s financial assets and financial
liabilities are measured on an ongoing basis at either fair value or at amortised
With effectonfrom
cost based 1 Januaryclassification.
their respective 2010, the Fund’s financialaccounting
The significant assets and financial
policies in
liabilities are measured
Note 2 describe how theon an ongoing
classes basisinstruments
of financial at either fair
arevalue or at amortised
measured, and how
income
cost basedandonexpenses, including
their respective fair value gains
classification. and losses,accounting
The significant are recognised. Thein
policies
following
Note table analyses
2 describe the financial
how the classes assets instruments
of financial and liabilities
areofmeasured,
the Fundand in how
the
statement
income of expenses,
and financial position
includingasfair
at 31 December
value 2010
gains and by theareclass
losses, of financial
recognised. The
instrument table
following to which they are
analyses theassigned,
financialand therefore
assets and by the measurement
liabilities of the Fund basis.
in the
statement of financial position as at 31 December 2010 by the class of financial
instrument to which they are assigned, and therefore by theFinancial measurement basis.
Financial liabilities at
assets at amortised
Financial
FVTPL Receivables liabilities
Financial costat Total
RM
assets at RM amortised RM RM
Assets FVTPL Receivables cost Total
RM RM RM RM
Quoted Shariah-compliant
Assets
investments 3,357,959 - - 3,357,959
Shariah-based
Quoted deposits
Shariah-compliant
with licensed financial
investments 3,357,959 - - 3,357,959
institutions deposits
Shariah-based - 503,952 - 503,952
Profit receivable
with licensed financial - 185 - 185
Cash at bank
institutions -- 624,864
503,952 - - 624,864
503,952
Profit receivable –––––––––- ––––––––185 –––––––– - –––––––– 185
Total financial
Cash at bank assets 3,357,959 - 1,129,001
624,864 - - 4,486,960
624,864
========
––––––––– =======
–––––––– =======
–––––––– ––––––––
Total financial assets 3,357,959 1,129,001 - 4,486,960
Total non-financial assets ======== ======= ======= 975,753
––––––––
Total non-financial assets 5,462,713
975,753
=======
––––––––
5,462,713
=======
37
37


19. Financial instruments (contd.)
19. Financial
(a) instrumentsof(contd.)
Classification financial instruments (contd.)
(a) Classification of financial instruments (contd.) Financial

Financial liabilities
assets at amortised
Financial
FVTPL Receivables
Financial cost
liabilities Total
assetsRM
at RM RM
amortised RM
FVTPL Receivables cost Total
Liabilities RM RM RM RM
Amount due to Trustee

Liabilities - - 1,529 1,529
Amount due to Manager - - 4,524 4,524
Other payable
Amount due to and accruals
Trustee -- -- 9,601
1,529 9,601
1,529
Amount due
Amount due to
to Manager
Stockbroker -- -- 987,487
4,524 987,487
4,524
Other payable and accruals –––––––––- ––––––––- ––––––––
9,601 ––––––––
9,601
Total financial
Amount liabilities
due to Stockbroker -- -- 1,003,141
987,487 1,003,141
987,487
========
––––––––– =======
–––––––– =======
–––––––– =======
––––––––
Total financial liabilities - - 1,003,141 1,003,141
Income, expense, gains ======== ======= ======= =======
and losses
Income, expense, gains
Net
andgains
lossesand losses 760,110 - - 760,110
Profit income - 13,290 - 13,290
Net gains and losses ========
760,110 ========- =======- =======
760,110
Profit income - 13,290 - 13,290
(b) Financial instruments that are carried at fair
======== value
======== ======= =======
(b) The Fund’s

Financial financial assets
instruments that at
areFVTPL areatcarried
carried at fair value. The fair values of
fair value
these financial assets were determined using quoted prices in active markets for
identical assets.
The Fund’s financial assets at FVTPL are carried at fair value. The fair values of
these financial assets were determined using quoted prices in active markets for
Quoted Shariah-compliant equity instruments
identical assets.
Fair value is determined directly by reference to their published market bid price
at the reporting date.
Quoted Shariah-compliant equity instruments
Fair value is determined directly by reference to their published market bid price
For Shariah-compliant equity instruments quoted on Bursa Malaysia, the market
at the reporting date.
bid prices are determined by reference to the theoretical closing market price as
published by Bursa Malaysia. The market bid prices of Shariah-compliant equity
For Shariah-compliant equity instruments quoted on Bursa Malaysia, the market
instruments quoted on other stock exchanges are determined by reference to
bid prices are determined by reference to the theoretical closing market price as
information made publicly available by these respective stock exchanges.
published by Bursa Malaysia. The market bid prices of Shariah-compliant equity
instruments quoted on other stock exchanges are determined by reference to
information made publicly available by these respective stock exchanges.
38
38


19. Financial instruments (contd.)
19. Financial
(b) instruments
Financial (contd.)that are carried at fair value (contd.)
instruments
(b) Financial instruments that are carried at fair value

31 (contd.)
December 2010
Level 1 Level 2 Level 3 Total
31 December 2010
RM RM RM RM
Level 1 Level 2 Level 3 Total
Financial assets at FVTPL RM RM RM RM
Quoted Shariah-compliant
Financial assets at FVTPL
investments 3,357,959 - - 3,357,959
Quoted Shariah-compliant ======== ===== ===== ========
investments 3,357,959 - - 3,357,959
(c) Financial instruments that are not carried at fair
======== value and =====
===== whose carrying
========
amounts are reasonable approximation of fair value
(c) Financial instruments that are not carried at fair value and whose carrying
The following
amounts are classesapproximation
are reasonable of financial instruments
of fair valuethat are not carried at fair
value and whose carrying amounts are reasonable approximation of fair value:
The following are classes of financial instruments that are not carried at fair
• Shariah-based
value depositsamounts
and whose carrying with licensed financial approximation
are reasonable institutions of fair value:
• Dividends receivable
•• Shariah-based
Profit receivable from Shariah-based
deposits with licensed deposits
financial institutions
•• Dividends
Other payables and accruals
receivable
•• Profit
Amounts due from/to
receivable from Manager
Shariah-based deposits
•• Other
Amounts due from/to
payables stockbrokers
and accruals
• Amounts due from/to Manager
•There were no
Amounts duefinancial instruments which are not carried at fair values and
from/to stockbrokers
whose carrying amounts are not reasonable approximation of their respective fair
values.were no financial instruments which are not carried at fair values and
There
whose carrying amounts are not reasonable approximation of their respective fair
Except for the effects arising from the adoption of FRS 139 as disclosed in Note
values.
2.2, the methods and basis for the determination of fair value of the Fund’s
financial instruments in the current financial year were consistent with that of the
Except for the effects arising from the adoption of FRS 139 as disclosed in Note
previous financial year.
2.2, the methods and basis for the determination of fair value of the Fund’s
financial instruments in the current financial year were consistent with that of the
previous financial year.
39
39


20. Financial risk and management objectives and policies
20. Financial
(a) risk and management objectives and policies
Introduction
(a) Introduction
The Fund maintains investment portfolios in a variety of listed and unlisted
financial instruments as dictated by its Trust Deed and investment management
The Fund maintains investment portfolios in a variety of listed and unlisted
strategy.
financial instruments as dictated by its Trust Deed and investment management
strategy.
The Fund is exposed to a variety of risks including market risk (which includes
interest rate risk and price risk), credit risk, liquidity risk and reclassification of
Shariah
The Fundstatus risk. Whilst
is exposed these are
to a variety the most
of risks important
including types
market riskof(which
financial risks
includes
inherentrate
interest in risk
eachand type
priceof risk),
financial
creditinstruments, therisk
risk, liquidity Manager would like to
and reclassification of
highlightstatus
Shariah that this
risk.list does these
Whilst not purport
are thetomost
constitute an exhaustive
important list of allrisks
types of financial the
risks inherent
inherent in eachin antype
investment in the Fund.
of financial instruments, the Manager would like to
highlight that this list does not purport to constitute an exhaustive list of all the
The inherent
risks Fund’s in objective in managing
an investment risk is the creation and protection of
in the Fund.
Unitholders’ value. Risk is inherent in the Fund’s activities, but it is managed
through
The a process
Fund’s of ongoing
objective identification,
in managing risk measurement and monitoring
is the creation of risks.
and protection of
Financial riskvalue.
Unitholders’ management is also carried
Risk is inherent out through
in the Fund’s soundbutinternal
activities, control
it is managed
systems aand
through adherence
process of ongoingto theidentification,
investment restrictions
measurement as and
stipulated in theof Trust
monitoring risks.
Deed, the risk
Financial Securities Commission’s
management is alsoGuidelines
carried out on Unit Trustsound
through Funds internal
and the Capital
control
Markets and
systems and Services
adherence Act,to2007.
the investment restrictions as stipulated in the Trust
Deed, the Securities Commission’s Guidelines on Unit Trust Funds and the Capital
The Manager
Markets takes all
and Services Act,prudent
2007. and reasonable steps to anticipate all foreseeable
risks and to ensure that potential loss to Unitholders is minimised.
The Manager takes all prudent and reasonable steps to anticipate all foreseeable
(b) Riskand
risks management
to ensure that structure
potential loss to Unitholders is minimised.
(b) The Fund’s

Risk Manager
management is responsible for identifying and controlling risks. The
structure
Board of Directors of the Manager is ultimately responsible for the overall risk
management
The approach is
Fund’s Manager within the Fund.for identifying and controlling risks. The
responsible
Board of Directors of the Manager is ultimately responsible for the overall risk
(c) Risk measurement
management approachand reporting
within system
the Fund.
(c) Monitoring
Risk and controlling
measurement risks issystem
and reporting primarily set up to be performed based on
limits established by the Manager. These limits reflect the investment strategy
and market environment of the Fund as well as the level of the risk that Fund is
Monitoring and controlling risks is primarily set up to be performed based on
willing to accept. In addition, the Fund monitors and measures the overall risk
limits established by the Manager. These limits reflect the investment strategy
bearing capacity in relation to the aggregate risk exposure across all risks type
and market environment of the Fund as well as the level of the risk that Fund is
and activities.
willing to accept. In addition, the Fund monitors and measures the overall risk
bearing capacity in relation to the aggregate risk exposure across all risks type
and activities.
40
40


20. Financial risk and management objectives and policies (contd.)
20. Financial
(d) risk
Risk and management objectives and policies (contd.)
mitigation
(d) The Fund

Risk has investment guidelines that set out its overall business strategies, its
mitigation
tolerance for risk and its general risk management philosophy. The Manager also
has aFund
The Compliance Department
has investment to ensure
guidelines that that the its
set out Fund complies
overall withstrategies,
business the variousits
regulations
tolerance for and guidelines
risk and as risk
its general stipulated in its philosophy.
management Trust Deed,Thethe Securities
Manager also
Commission’s
has a Compliance Guidelines on to
Department Unit Trustthat
ensure Funds and the
the Fund Capital
complies withMarkets and
the various
Services Act,and
regulations 2007.
guidelines as stipulated in its Trust Deed, the Securities
Commission’s Guidelines on Unit Trust Funds and the Capital Markets and
It is, and Act,
Services has been
2007.throughout the current and previous financial year, the Fund’s
policy that no derivatives shall be undertaken for either investment risk
Itmanagement
is, and has purposes.
been throughout the current and previous financial year, the Fund’s
policy that no derivatives shall be undertaken for either investment risk
(e) Excessive risk
management concentration
purposes.
(e) Concentration
Excessive risk indicates the relative sensitivity of the Fund’s performance to
concentration
developments affecting a particular industry or geographical location.
Concentrations indicates
Concentration of risk arise
thewhen a number
relative of financial
sensitivity of the instruments or contractsto
Fund’s performance
are entered into affecting
developments with the same counterparty,industry
a particular or whereor a number of counterparties
geographical location.
are engaged in of
Concentrations similar business
risk arise whenactivities,
a numberorofactivities
financial in the same or
instruments geographic
contracts
region,
are or have
entered into similar
with theeconomic features that
same counterparty, or would
where cause
a numbertheirofability to meet
counterparties
contractual
are engagedobligations
in similar to be similarly
business affected
activities, or by changesininthe
activities economic, political
same geographic
or otherorconditions.
region, have similarConcentrations of foreign
economic features exchange
that would causerisk may
their arisetoif meet
ability the
Fund has a obligations
contractual significant net
to beposition in aaffected
similarly single foreign currency,
by changes or aggregate
in economic, net
political
positions
or in several currencies
other conditions. that tend
Concentrations oftoforeign
move together.
exchange risk may arise if the
Fund has a significant net position in a single foreign currency, or aggregate net
In order in
positions toseveral
avoid currencies
excessive that
concentration of together.
tend to move risk, the Fund’s policies and
procedures include specific guidelines to focus on maintaining a diversified
portfolio
In in avoid
order to accordance with concentration
excessive the Fund’s Trust Deed,theInvestment
of risk, Manager’s
Fund’s policies and
guidelines and the Securities Commission’s Guidelines on Unit Trust Funds.
procedures include specific guidelines to focus on maintaining a diversified
Portfolio diversification across a number of sectors and industries minimises the
portfolio in accordance with the Fund’s Trust Deed, Investment Manager’s
risk not only of any single company’s securities becoming worthless but also of
guidelines and the Securities Commission’s Guidelines on Unit Trust Funds.
all holdings suffering uniformly adverse business conditions. Specifically, the
Portfolio diversification across a number of sectors and industries minimises the
Fund’s Trust Deed and Securities Commission’s Guidelines on Unit Trust Funds
risk not only of any single company’s securities becoming worthless but also of
limits the Fund’s exposure to a single entity/industry sector to a certain
all holdings suffering uniformly adverse business conditions. Specifically, the
percentage of its NAV.
Fund’s Trust Deed and Securities Commission’s Guidelines on Unit Trust Funds
limits the Fund’s exposure to a single entity/industry sector to a certain
percentage of its NAV.
41
41
Kenanga Syariah
Notes to the Growth
Statements
Notes
20. toFinancial
the Financial Statements
risk and - 31 December
management 2010
objectives and policies (contd.)
(f) Market risk

Market risk is the risk that the fair value or future cash flows of financial
(f) Market riskwill fluctuate due to changes in market variables such as interest
instruments
rates, foreign exchange rates and equity prices. The maximum risk resulting from
Market
financialrisk is the risk
instruments thattheir
equals thefair
fairvalue.
value or future cash flows of financial
instruments will fluctuate due to changes in market variables such as interest
rates, Interest
(i) foreign exchange
rate risk rates and equity prices. The maximum risk resulting from
financial instruments equals their fair value.
The risk refers to the exposure of the Fund’s assets to movements in interest
(i) rates.
InterestInrate
thisrisk
regard, the fund’s exposure to interest rate risk is mainly
confined to Shariah-based deposits placement with licensed financial
The risk refers to the exposure of the Fund’s assets to movements in interest
institutions.
rates. In this regard, the fund’s exposure to interest rate risk is mainly
confined
Interest rateto isShariah-based deposits
a general economic placement
indicator with
that will havelicensed financial
an impact on the
institutions.
management of funds regardless of whether it is a Shariah-based fund or
otherwise. It does not in any way suggest that this fund will invest in
Interest rate isfinancial
conventional a generalinstruments.
economic indicator that will have
All the investments an impact
carried on this
out for the
management of funds
fund are accordance regardless
with of whether
requirements it is a Shariah-based fund or
of the Shariah.
otherwise. It does not in any way suggest that this fund will invest in
conventional financial instruments. All the investments carried out for this
fund are accordance with requirements of the Shariah.
42
42
enanga Syariah Growth
Notes Fund
to the Financial Statements - 31 December 2010
tes to the Financial Statements - 31 December 2010

. Financial risk and management objectives and policies (contd.)
(f) Market risk (contd.)
(i) Interest rate risk (contd.)
(i) Interest rate risk (contd.)
Interest rate risk exposure
Interest rate risk exposure
The following table analyses the Fund’s interest rate risk exposure. The Fund’s assets and liabilities are included at fair
The following table analyses
value the Fund’s
and categorised byinterest
the earlier
rateofrisk exposure.
contractual The Fund’s
re-pricing assets and
or maturity liabilities are included at fair
dates
value and categorised by the earlier of contractual re-pricing or maturity dates
Non-exposure
0-3 3 months- Non-exposure to interest rate Effective rate
0-3 3 months-
months to
5 years interest rate
5-10 years movement EffectiveTotalrate of return*
months 5 years 5-10 yearsRM movement RM Total
RM of return* RM %
2010 RM RM RM RM %
2010
Assets:
Assets: Financial assets held at FVTPL - - - 3,357,959 3,357,959
Financial assets held
Shariah-based
at FVTPL deposits with - - - 3,357,959 3,357,959
Shariah-based deposits
financial
withinstitutions 503,952 - - - 503,952 2.18%
financial institutions
Other assets 503,952 - - - - - - 503,952
1,600,802 2.18%
1,600,802
Other assets - ––––––––- -
–––––––– 1,600,802
–––––––– 1,600,802
––––––––– –––––––––
Total assets –––––––– ––––––––
503,952 –––––––– - ––––––––– - ––––––––– 4,963,609 5,462,713
Total assets 503,952 ––––––––- -
–––––––– 4,963,609
–––––––– 5,462,713
––––––––– –––––––––
Liabilities: –––––––– –––––––– –––––––– ––––––––– –––––––––
Liabilities: Other liabilities - - - 1,003,141 1,003,141
Other liabilities - ––––––––- -
–––––––– 1,003,141
–––––––– 1,003,141
––––––––– –––––––––
Total liabilities –––––––– –––––––– - –––––––– - ––––––––– - ––––––––– 1,003,141 1,003,141
Total liabilities - ––––––––- -
–––––––– 1,003,141
–––––––– 1,003,141
––––––––– –––––––––
––––––––
Total interest sensitivity gap ––––––––
503,952 –––––––– - ––––––––– - ––––––––– 3,960,468 4,459,572
Total interest sensitivity gap 503,952 ======= - =======- 3,960,468
======= 4,459,572
======== =========
======= =======
* Computed based on Shariah-based deposits ======= ======== =========
* Computed based on Shariah-based deposits
43
43
enanga Syariah Growth Fund
tes to the Financial Statements - 31 December 2010

(ii) Equity price risk
(ii) Equity price risk
Equity price risk is the risk of unfavourable changes in the fair values of Shariah-compliant equities as the result of
Equity price risk is the risk of unfavourable changes in the fair values of Shariah-compliant equities as the result of
changes in the levels of Shariah-compliant equity indices and the value of individual Shariah-compliant shares. The equity
changes in the levels of Shariah-compliant equity indices and the value of individual Shariah-compliant shares. The equity
price risk exposure arises from the Fund’s investments in quoted Shariah-compliant equity securities.
price risk exposure arises from the Fund’s investments in quoted Shariah-compliant equity securities.
Equity price risk sensitivity
Equity price risk sensitivity
Management’s best estimate of the effect on the profit/(loss) for the year and other comprehensive income due to a
Management’s best estimate of the effect on the profit/(loss) for the year and other comprehensive income due to a
reasonably possible change in Shariah-compliant equity indices, with all other variables held constant is indicated in the
reasonably possible change in Shariah-compliant equity indices, with all other variables held constant is indicated in the
table below:
table below:
Effects on other Effects on Shariah-
Changes in Effects
Effects on profit
on other comprehensive
Effects on Shariah-compliant equity
in Effects on profit
ChangesShariah-compliant comprehensive
for the year income compliant
increase/equity investments
Market index Shariah-compliant for the year
equity price income
increase/ increase/
(decrease) investments
(decrease) increase/(decrease)
Market index equity price increase/ (decrease)
% (decrease)
RM increase/(decrease)
RM RM
% RM RM RM
2010
2010
FTSE Bursa Malaysia
FTSE Bursa Malaysia
Emas Shariah Index +5 / -5 191,762/ - 191,762/
Emas Shariah Index +5 / -5 191,762/ - 191,762/
(70,308) (70,308)
(70,308) (70,308)
========= ========= ========= =========
========= ========= ========= =========
An equivalent decrease in each of the indices shown above would have resulted in an equivalent, but opposite, impact.
An equivalent decrease in each of the indices shown above would have resulted in an equivalent, but opposite, impact.
In practice, the actual trading results may differ from the sensitivity analysis below and the difference could be material.
In practice, the actual trading results may differ from the sensitivity analysis below and the difference could be material.
44
44
Kenanga Syariah
Notes to the Growth
Statements

20. Financial
(f) risk and
Market riskmanagement
(contd.) objectives and policies (contd.)
(f) Market
(ii) risk (contd.)
Equity price risk (contd.)
(ii) Equity
Equity price
price risk
risk (contd.)
concentration
Equity price risk

The following concentration
table set out the Fund’s exposure to equity price risk base
on its portfolio to Shariah-compliant equity instruments as at the
The following
reporting date. table set out the Fund’s exposure to equity price risk base
on its portfolio to Shariah-compliant equity instruments as at the
reporting date. 2010
As a %
RM 2010 of NAV
Malaysia 3,357,959 As75.47
a%
RM of NAV
The Fund’s concentration of equity price 3,357,959
Malaysia risk analysed by the75.47
Fund’s
Shariah-compliant equity instruments by sector is as follows:
The Fund’s concentration of equity price risk analysed2010 by the Fund’s
Shariah-compliant equity instruments by sector is as follows: As a %
RM 2010 of NAV
As a %
Construction 248,780
RM 5.59
of NAV
Consumer products 619,644 13.93
Infrastructure project companies
Construction 236,280
248,780 5.31
5.59
Plantation products
Consumer 452,180
619,644 10.16
13.93
Trading/Services
Infrastructure project companies 1,622,140
236,280 36.46
5.31
Islamic REITS
Plantation 178,935
452,180 4.02
10.16
Trading/Services –––––––––
1,622,140 ––––––––
36.46
Islamic REITS 3,357,959
178,935 75.47
4.02
========
––––––––– =======
––––––––
3,357,959 75.47
======== =======
45
45


20. (g) Credit

Financial risk management objectives and policies (contd.)
risk and
(g) Credit risk is the risk that the counterparty to a financial instrument will cause a
Credit risk
financial loss for the Fund by failing to discharge an obligation. The Fund is
Credit
exposedrisktoisthe
the risk that the counterparty
of credit-related to athat
losses financial instrument
can occur as a will cause
result of a
financial loss or
counterparty for issuer
the Fund by unable
being failing to
or discharge
unwilling anto obligation.
honour itsThe Fund is
contractual
exposed
obligationsto tothe make
risk of credit-related
timely payments losses that principal
of profit, can occur andas proceeds
a result from
of a
counterparty
realisation of or issuer being unable
Shariah-compliant or unwilling
investments. to honour
These credit exposuresits exist
contractual
within
obligations to make timely
financing relationships, Islamicpayments of and
derivatives profit,
otherprincipal and proceeds from
transactions.
realisation of Shariah-compliant investments. These credit exposures exist within
financing
The Manager relationships,
manages Islamic derivatives
the Fund’s and other
credit risk transactions.
by undertaking credit evaluation
and close monitoring of any changes to the issuer/counterparty’s credit profile to
The Manager
minimise suchmanages
risk. It is the credit to
the Fund’s policy risk by into
enter undertaking
financial credit evaluation
instruments with
and close monitoring
reputable of any changes
counterparties. The toManager
the issuer/counterparty’s
also closely credit profilethe
monitors to
minimise such risk.
creditworthiness of Itthe
is the Fund’s
Fund’s policy to enter
counterparties intobrokers,
(e.g., financialcustodian,
instruments with
banks,
reputable counterparties.
etc.) by reviewing The and
their credit ratings Manager also onclosely
credit profile a regularmonitors
basis. the
creditworthiness of the Fund’s counterparties (e.g., brokers, custodian, banks,
etc.) by risk
Credit reviewing
exposuretheir credit ratings and credit profile on a regular basis.
Credit risk exposure

At the reporting date, the Fund’s maximum exposure to credit risk is represented
by the carrying amount of each class of financial assets recognised in the
At the reporting
statement date, the
of financial Fund’sNone
position. maximum exposure
of the Fund’s to creditassets
financial risk is represented
were past due
or impaired
by as at 31
the carrying December
amount 2010.class of financial assets recognised in the
of each
statement of financial position. None of the Fund’s financial assets were past due
or impaired as at 31 December 2010.
46
46


20. Financial
(h) risk andrisk
Liquidity management objectives and policies (contd.)
(h) Liquidity
Liquidity risk
risk is defined as the risk that the Fund will encounter difficulty in
meeting obligations associated with financial liabilities that are settled by
Liquidity
deliveringriskcashis or
defined as the
another risk that
financial the Exposure
asset. Fund will toencounter
liquiditydifficulty
risk arisesin
meeting
because of obligations associated
the possibility that thewith
Fundfinancial liabilitiestothat
could be required areliabilities
pay its settled byor
delivering
redeem its cash or another
units earlier financial The
than expected. asset.Fund
Exposure
is exposedto liquidity risk arises
to cash redemptions
because of the
of its units onpossibility
a regular that theUnits
basis. Fund sold
couldtobeunitholders
required toby paytheitsManager
liabilitiesare
or
redeemable
redeem at theearlier
its units unitholder’s option based
than expected. on theisFund’s
The Fund exposednettoasset
cashvalue per unit
redemptions
at the
of its time
unitsofonredemption
a regular calculated
basis. Unitsin accordance with the Fund’s
sold to unitholders by theTrust Deed.are
Manager
redeemable at the unitholder’s option based on the Fund’s net asset value per unit
The
at theManager’s policy iscalculated
time of redemption to alwaysinmaintain
accordancea prudent
with theand sufficient
Fund’s level of
Trust Deed.
Shariah-based liquid assets so as to meet normal operating requirements and
expected
The redemption
Manager’s policy is requests
to alwaysby maintain
unitholders. Shariah-based
a prudent liquidlevel
and sufficient assets
of
comprise cash,liquid
Shariah-based Shariah-based
assets so as deposits
to meetwith financial
normal institutions
operating and other
requirements and
instruments
expected which are capable
redemption requestsof being converted into
by unitholders. cash within 7liquid
Shariah-based days. assets
comprise cash, Shariah-based deposits with financial institutions and other
The following
instruments table
which aresummarises the maturity
capable of being profile
converted intoof thewithin
cash Fund’s7 units
days.in issue
(classified as Shariah-compliant equity instruments) and financial liabilities.
Balances
The due within
following six months the
table summarises equal their carrying
maturity profile ofamounts,
the Fund’s as the impact
units of
in issue
discountingasis Shariah-compliant
(classified insignificant. The tableequityalso analyses theand
instruments) maturity
financialprofile of the
liabilities.
Fund’s financial
Balances due within assets
six(undiscounted
months equalwhere appropriate)
their carrying and equity
amounts, as theinimpact
order ofto
provide a complete
discounting view of the
is insignificant. TheFund’s
table contractual
also analyses commitments
the maturity andprofile
liquidity.
of the
Fund’s financial assets (undiscounted where appropriate) and equity in order to
provide a complete view of the Fund’s contractual commitments and liquidity.
47
47
enanga Syariah Growth Fund
otes to the Financial Statements - 31 December 2010

(h) Liquidity risk (contd.)
(h) Liquidity risk (contd.)
Less than 1 month- 3 months- 1 year- 5-10
Less than 1 month- 3 months- 1 year- 5-10
1 month 3 months 1 year 5 years years Total
1 month 3 months 1 year 5 years years Total
RM RM RM RM RM RM
RM RM RM RM RM RM
2010
2010
Financial assets:
Financial assets:
Financial assets held at FVTPL 3,357,959 - - - - 3,357,959
Financial assets held at FVTPL 3,357,959 - - - - 3,357,959
Shariah-based deposits with
Shariah-based deposits with
financial institutions 503,952 - - - - 503,952
financial institutions 503,952 - - - - 503,952
Other assets 1,600,802 - - - - 1,600,802
Other assets 1,600,802 - - - - 1,600,802
––––––––– –––––––– –––––––– ––––––––– ––––––––– ––––––––––
––––––––– –––––––– –––––––– ––––––––– ––––––––– ––––––––––
Total undiscounted financial assets 5,462,713 - - - - 5,462,713
Total undiscounted financial assets 5,462,713 - - - - 5,462,713
––––––––– –––––––– –––––––– ––––––––– ––––––––– ––––––––––
––––––––– –––––––– –––––––– ––––––––– ––––––––– ––––––––––
Financial liabilities:
Financial liabilities:
Other liabilities 1,003,141 - - - - 1,003,141
Other liabilities 1,003,141 - - - - 1,003,141
––––––––– –––––––– –––––––– ––––––––– ––––––––– ––––––––––
––––––––– –––––––– –––––––– ––––––––– ––––––––– ––––––––––
Total undiscounted financial liabilities 1,003,141 - - - - 1,003,141
Total undiscounted financial liabilities 1,003,141 - - - - 1,003,141
––––––––– –––––––– –––––––– ––––––––– ––––––––– ––––––––––
––––––––– –––––––– –––––––– ––––––––– ––––––––– ––––––––––
Unitholders capital 4,459,572 - - - - 4,459,572
Unitholders capital 4,459,572 - - - - 4,459,572
––––––––– –––––––– –––––––– ––––––––– ––––––––– ––––––––––
––––––––– –––––––– –––––––– ––––––––– ––––––––– ––––––––––
Liquidity gap - - - - - -
Liquidity gap - - - - - -
======== ======= ======= ======== ========= =========
======== ======= ======= ======== ========= =========
48
48
Kenanga Syariah
Notes to the Growth
Statements

20. Financial
(h) risk andrisk
Liquidity management
(contd.) objectives and policies (contd.)
(h) Notes: risk (contd.)

Liquidity
(i)
Notes: Financial assets
Analysis of financial assets at fair value through profit or loss into
(i) maturity groupings
Financial assets is based on the expected date on which these assets
will be realised.
Analysis Quotedassets
of financial Shariah-compliant
at fair value equitythroughinstruments
profit orhaveloss been
into
included groupings
maturity in the “Lessisthan based 1 month
on thecategory”
expectedon theon
date assumption
which thesethat assets
these
are highly
will liquidQuoted
be realised. Shariah-compliant
Shariah-compliant investments
equity which can behave
instruments realised
been
should allinofthe
included the“Less
Fund’s thanunitholders’ capital are
1 month category” on required to be redeemed.
the assumption that these
For highly
are other assets, the analysis into maturity
liquid Shariah-compliant groupings
investments which iscan based on the
be realised
remaining
should all ofperiod from the
the Fund’s end of thecapital
unitholders’ reporting
are period
requiredtotothebecontractual
redeemed.
maturity
For otherdate
assets,or ifthe
earlier, the expected
analysis into maturitydate on which the
groupings is assets
based will be
on the
realised/maturity
remaining period dates
from of thesukuk.
end of the reporting period to the contractual
maturity date or if earlier, the expected date on which the assets will be
(ii) Financial liabilities
realised/maturity dates of sukuk.
The maturity grouping is based on the remaining period from the end of
(ii) the reporting
Financial period to the contractual maturity date. When a counterparty
liabilities
has amaturity
The choice of when the
grouping amount
is based onisthepaid, the liability
remaining periodis from
allocated to the
the end of
earliest
the periodperiod
reporting in which thecontractual
to the Fund can bematurity
requireddate.
to pay.
When a counterparty
has a choice of when the amount is paid, the liability is allocated to the
(iii) earliest
Shariah-compliant
period in which equitythe Fund can be required to pay.
As unitholders can request for redemption on their units without giving
(iii) the Manager any notice
Shariah-compliant equityperiod and the redemption are payable within 10
days,
As they havecan
unitholders been categorised
request as havingona their
for redemption maturity
unitsofwithout
“Less than
giving 1
month”.
the As aany
Manager result,
noticeit appears
period and thatthe
theredemption
Fund has aare liquidity
payablegap within
within 10
“Less they
days, than have
1 month”.been However,
categorised theasFund believes
having that it would
a maturity of “Lessbe able
thanto1
liquidate As
month”. other Shariah-compliant
a result, it appears thatinvestments
the Fund has should the need
a liquidity gaparise
withinto
satisfythan
“Less all the redemption
1 month”. requirements
However, the Fund of believes
the Fund.that it would be able to
liquidate other Shariah-compliant investments should the need arise to
(i) Specificsatisfy
risk all the redemption requirements of the Fund.
(i) The Fund

Specific is exposed to the individual risk of the respective companies issuing
risk
Shariah-compliant securities and sukuk which includes changes to the business
performance
The of the to
Fund is exposed company, consumer
the individual tastes
risk of and demand,
the respective lawsuits
companies and
issuing
management practices.
Shariah-compliant This risk
securities and is minimised
sukuk which through
includesthechanges
well diversified nature
to the business
of the Fund. of the company, consumer tastes and demand, lawsuits and
performance
management practices. This risk is minimised through the well diversified nature
of the Fund.
49
49


20. Financial
(j) risk and
Inflation management objectives and policies (contd.)
risk
(j) Inflation
The Fund riskis subject to the risk of Unitholders’ investment not growing
proportionately to the inflation rate thereby decreasing the Unitholders’ purchasing
The
powerFund is subject
even though to the risk
the investment of Unitholders’
in monetary terms mayinvestment not growing
have increased.
proportionately to the inflation rate thereby decreasing the Unitholders’ purchasing
(k) power even though
Compliance risk the investment in monetary terms may have increased.
(k) Compliance risk of regulations imposed by the Securities Commission

Non-compliance Act 1993
and the Securities Commission’s Guidelines on Unit Trust Funds may affect the
Non-compliance of regulations imposed by the Securities Commission
Unitholders’ investment. Act 1993
and the Securities Commission’s Guidelines on Unit Trust Funds may affect the
(l) Unitholders’
Single issuerinvestment.
risk
(l) Single
Internalissuer
policyrisk
restricts the Fund from investing in Shariah-compliant securities
issued by any issuer of not more than a certain percentage of its net assets value.
Internal
Under suchpolicy restrictsthe
restriction, therisk
Fund from investing
exposure in Shariah-compliant
to the Shariah-compliant securities
securities of any
issued bymanaged
issuer is any issuer of not
based more than a certain
on internal/external percentage of its net assets value.
ratings.
Under such restriction, the risk exposure to the Shariah-compliant securities of any
(m) issuer is managed
Regulatory risk based on internal/external ratings.
(m) Regulatory
Any changesrisk
in national policies and regulations may have an effect on the capital
market.
Any changes in national policies and regulations may have an effect on the capital
(n) Management risk
market.
(n) Poor management

Management risk of a fund may cause considerable losses to the Fund that in turn
will affect the capital invested by Unitholders.
Poor management of a fund may cause considerable losses to the Fund that in turn
(o) Reclassification
will of Shariah
affect the capital investedstatus risk
by Unitholders.
(o) The risk that theof currently

Reclassification held Shariah-compliant
Shariah status risk securities in the portfolio of
Shariah-based fund may be reclassified to be Shariah-non-compliant upon review of
the securities
The by currently
risk that the the Shariah
heldAdvisory Council ofsecurities
Shariah-compliant the Securities
in the Commission
portfolio of
performed twice
Shariah-based fundyearly.
may beIfreclassified
this occurs,
to the value of the Fund may
be Shariah-non-compliant be adversely
upon review of
affected
the wherebythetheManager
securities Shariah will take the
Advisory necessary
Council of thesteps to dispose
Securities of such
Commission
securities. twice yearly. If this occurs, the value of the Fund may be adversely
performed
affected where the Manager will take the necessary steps to dispose of such
securities.
50
50
Office Directory
Office Directory
Our Offices:
Our Offices:
HEAD OFFICE – Kuala Lumpur REGIONAL OFFICE – Kuala Lumpur
HEAD OFFICE
Level 39, Menara–Standard
Kuala Lumpur
Chartered REGIONAL OFFICE Suite No –5.06,
Kuala Lumpur
Jalan Sultan Ismail 50250 Kuala Lumpur 5th Floor Kenanga International
Level 39, Menara Standard Chartered Jalan SultanSuite
IsmailNo 5.06,Kuala Lumpur
50250
Jalan SultanTel
Ismail
+60350250
2142 Kuala
6888 Lumpur 5th Floor
TelKenanga
+603 2713International
3188
Fax +063 2142 6887 Jalan SultanFax
Ismail
+06350250
2713Kuala
5868 Lumpur
Tel +603 2142 6888 Tel +603 2713 3188
Fax +063 2142 6887 Fax +063 2713 5868
REGIONAL OFFICE – Kuching REGIONAL OFFICE – Kota Kinabalu
REGIONAL
Level 1 OFFICE – Kuching
Wisma Mahmud REGIONAL LotOFFICE
47 No.20 –1stKota Kinabalu
Floor
Jalan Sungai Sarawak Damai Plaza
Level
93100 1 Wisma
KuchingMahmud
Sarawak Lot 47 No.20
Phase 1st Floor
IV Block F
Jalan Sungai Sarawak LorongDamai
PokokPlaza
Kayu Manis II
93100 Kuching Sarawak Phase
88300 KotaIVKinabalu
Block F Sabah
Tel +6082 343022 LorongTel
Pokok
+6088Kayu Manis II
269678
Fax +082 343066 88300 Fax
Kota+088
Kinabalu
259678Sabah
Tel +6082 343022 Tel +6088 269678
Fax +082 343066 Fax +088 259678
The Funds are also available at the followings places/ financial institutions:
The Funds are also available at the followings places/ financial institutions:
1. Alliance Bank (Malaysia) Berhad
2. Philip Mutual Bhd
1.3. Alliance
RHB BankBankBhd(Malaysia) Berhad
2.4. Philip Mutual
Standard Bhd Bank Malaysia Berhad
Chartered
3.5. RHB BankSecurities
Malacca Bhd Sdn. Bhd.
4.6. Standard Chartered
iFAST Capital SdnBank
Bhd Malaysia Berhad
5.7. Malacca Securities
Other approved Sdn. Bhd. Unit Trust Advisers (as and when appointed by the Manager)
Institutional
6.8. iFAST Capital
Registered Sdn Bhd Tied Agents with Federation of Investment Managers Malaysia
Independent
7. Other
(FiMM)approved Institutional Unit Trust Advisers (as and when appointed by the Manager)
8. Registered Independent Tied Agents with Federation of Investment Managers Malaysia
(FiMM)
51
51
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52
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52

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KENANGA SYARIAH GROWTH FUND

Report to Unit Holders

Level 39, Menara Standard Chartered

Kenanga Syariah Growth Fund

Kenanga Syariah Growth Fund

Fund Category and Type and Benchmark

Breakdown of Unit Holdings by Unit

Size of holdings Unit Holders %

Kenanga Syariah Growth Fund

Fund’s Performance as per Lipper Fund Table

Annual Total Return for Financial Year ended 31 December Since

Kenanga Syariah Growth Fund

The Net Asset Value of the Fund is represented

Performance Chart Since 1st Trading Day (18/02/2002 – 31/12/2010)

Kenanga Syariah Growth Fund

Portfolio of the Fund

Shariah-compliant Equity 75.47%

Shariah-compliant Equity 75.47%

Detailed Breakdown of Equity by Sector as at 31 December 2010

Detailed Breakdown of Equity byConsumer

Kenanga Syariah Growth Fund

PERFORMANCE DATA Data for the last 3 financial periods/years:

Summary of Performance Data for the last 3 financial periods/years:

Kenanga Syariah Growth Fund

Portfolio Composition as at 31 December 2010

Islamic REIT Shariah-compliant

Kenanga Syariah Growth Fund

Policy on Stockbroking Rebates and Soft Commissions

INVESTORS ARE REMINDED THAT PAST PERFORMANCE IS NOT NECESSARILY

Kenanga Syariah Growth Fund

Trustee’s Report of Kenanga Syariah Growth Fund

To the Unitholders of Kenanga Syariah Growth Fund

For HSBC (Malaysia) Trustee Berhad

Manager, Trustee Operation

Manager, Trustee Operation

Kuala Lumpur, Malaysia

Kenanga Syariah Growth Fund

Shariah Adviser’s Report

Shariah Adviser’s Report

To the Unitholders of Kenanga Syariah Growth Fund

For Islamic Banking and Finance Institute Malaysia Sdn. Bhd.

Mohd Nasir Ismail

Kenanga Syariah Growth Fund

Statement by the Manager

Statement by the Manager

For and on behalf of the Manager,

Datuk Syed Ahmad Alwee Alsree Abdul Razak Bin Ahmad

Datuk Syed Ahmad Alwee Alsree Abdul Razak Bin Ahmad

Kuala Lumpur, Malaysia

Kenanga Syariah Growth Fund

Independent Auditors’ Report to the Unitholders of

Kenanga Syariah Growth Fund

Independent Auditors’ Report to the Unitholders of

ERNST & YOUNG WONG LAI WAH

ERNST & YOUNG WONG LAI WAH

Kuala Lumpur, Malaysia

The accompanying notes are an integral part of the financial statements.

The accompanying notes are an integral part of the financial statements. 15

Kenanga Syariah Growth Fund

Statement of Financial Position as at 31 December 2010

The accompanying notes are an integral part of the financial statements. 16

Kenanga Syariah Growth Fund