Source: Morningstar/MSCI.
Ordinary share price total return. Benchmark.
A table showing actual expenditure by the Company on remuneration and distributions to shareholders for the year and the prior year is below:
Expenditure by the Company on remuneration and distributions to shareholders Year ended 30th September 2014 2013 Remuneration paid to all Directors £132,526 £122,500 Distribution to shareholders
— by way of dividend n/a n/a
— by way of share
repurchases £14,733,000 £38,705,000
By order of the Board
Jonathan Latter, for and on behalf of JPMorgan Funds Limited,
Secretary 15th December 2014 80 90 100 110 120 130 2014 2013 2012 2011 2010 2009 Indian_pp17_30_Indian_pp17_30 15/12/2014 11:58 Page 29
The Directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulations.
Company law requires the Directors to prepare financial statements for each financial year. Under that law the Directors are required to prepare the Group financial statements in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union and Article 4 of the IAS Regulation and have also chosen to prepare the Parent Company financial statements under IFRS as adopted by the EU. Under company law the Directors must not approve the accounts unless they are satisfied that, taken as a whole, the annual report and accounts provide the information necessary for shareholders to assess the Company’s performance, business model and strategy and that they give a true and fair view of the state of affairs of the Company and of the total return or loss of the Company for that period. In order to provide these confirmations, and in preparing these financial statements, the Directors must be satisfied that, taken as a whole, the annual report and accounts are fair, balanced and understandable; and the Directors are required to:
• select suitable accounting policies and then apply them consistently;
• make judgements and accounting estimates that are reasonable and prudent;
• state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and
• prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business;
and the Directors confirm that they have done so.
The Directors are responsible for keeping proper accounting records that are sufficient to show and explain the Company’s transactions and disclose with reasonable accuracy at any time the financial position of the Company and enable them to ensure that the financial statements comply with the
Companies Act 2006. They are also responsible for
safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The accounts are published on the www.jpmindian.co.uk website, which is maintained by the Company’s Manager. The maintenance and integrity of the website maintained by the Manager is, so far as it relates to the Company, the
responsibility of the Manager. The work carried out by the auditors does not involve consideration of the maintenance and integrity of this website and, accordingly, the auditors accept no responsibility for any changes that have occurred to the Annual Report since they were initially presented on the website. The Annual Report is prepared in accordance with UK legislation, which may differ from legislation in other
jurisdictions.
Under applicable law and regulations the Directors are also responsible for preparing a Strategic Report, a Directors’ Report and Directors’ Remuneration Report that comply with that law and those regulations.
Each of the Directors, whose names and functions are listed on pages 17 and 18, confirms that, to the best of his or her
knowledge the financial statements, which have been prepared in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards) and applicable law, give a true and fair view of the assets, liabilities, financial position and return or loss of the Company. The Board confirms that it is satisfied that the annual report and accounts taken as a whole are fair, balanced and understandable and provide the information necessary for shareholders to assess the strategy and business model of the Company.
For and on behalf of the Board Hugh Bolland
Chairman
15th December 2014
Governance continued
Statement of Directors’ Responsibilities
Opinion on financial statements of JPMorgan Indian Investment Trust plc
In our opinion:
• the financial statements give a true and fair view of the state of the Group’s and of the parent company’s affairs as at 30th September 2014 and of the Group’s profit for the year then ended;
• the Group financial statements have been properly prepared in accordance with International Financial Reporting Standards (IFRSs) as adopted by the European Union;
• the parent company financial statements have been properly prepared in accordance with IFRSs as adopted by the European Union and as applied in accordance with the provisions of the Companies Act 2006; and
• the financial statements have been prepared in accordance with the requirements of the Companies Act 2006 and, as regards the Group financial statements, Article 4 of the IAS Regulation.
The financial statements comprise the Group Income Statement, the Group and Company Statements of Changes in Equity, the Group and Parent Company Balance Sheets, the Group and Parent Company Cash Flow Statements and the related notes 1 to 22. The financial reporting framework that has been applied in their preparation is applicable law and IFRSs as adopted by the European Union and, as regards the parent company financial statements, as applied in accordance with the provisions of the Companies Act 2006.
Going concern
As required by the Listing Rules we have reviewed the Directors’ statement contained within the Directors’ Report on page 19 that the Group is a going concern. We confirm that: • we have concluded that the Directors’ use of the going
concern basis of accounting in the preparation of the financial statements is appropriate; and
• we have not identified any material uncertainties that may cast significant doubt on the Group’s ability to continue as a going concern.
However, because not all future events or conditions can be predicted, this statement is not a guarantee as to the Group’s ability to continue as a going concern.
Our assessment of risks of material misstatement
The assessed risks of material misstatement described below are those that had the greatest effect on our audit strategy, the allocation of resources in the audit and directing the efforts of the engagement team.
How the scope of our audit
Risk responded to the risk
Valuation of investments
The investments of the Group make up 99% of total assets.
There is a risk that investments within the portfolio may not be actively traded and the prices quoted may not be reflective of fair value.
Ownership of investments The investments of the Group make up 99% of total assets.
There is a risk that investments within the portfolio may not represent the property of the Group.
Last year our report included two other risks which are not included in our report this year: failure to comply with the provisions of Sections 1158/1159 of the Corporation Tax Act 2010 and consolidation of the subsidiary. These two risks are not considered to have had the greatest effect on our audit strategy, the allocation of resources in the audit and directing the efforts of the engagement team.
We reviewed the SSAE 16 controls report to understand the controls in place at the custodian over the valuation of investments.
We agreed 100% of the bid prices of quoted investments on the investment ledger at year end to closing bid prices published by an independent pricing source.
We made enquiries of the Manager and Directors regarding their assessment of the portfolio pricing and liquidity.
We reviewed the completeness and appropriateness of disclosures in relation to fair value measurements and liquidity risk.
We reviewed the SSAE 16 controls report to understand the controls in place at the custodian over the ownership of investments
We agreed 100% of the Group’s investment portfolio at the year end to confirmation received directly from the independent custodian.
Independent Auditor’s Report
Indian_pp31_38_Indian_pp31_38 15/12/2014 11:57 Page 31The description of risks above should be read in conjunction with the significant issues considered by the Audit Committee discussed on page 23.
Our audit procedures relating to these matters were designed in the context of our audit of the financial statements as a whole, and not to express an opinion on individual accounts or disclosures. Our opinion on the financial statements is not modified with respect to any of the risks described above, and we do not express an opinion on these individual matters.
Our application of materiality
We define materiality as the magnitude of misstatement in the financial statements that makes it probable that the economic decisions of a reasonably knowledgeable person would be changed or influenced. We use materiality both in planning the scope of our audit work and in evaluating the results of our work.
Based on our professional judgment, we determined an overall materiality for the Group as being approximately 1% of Net Assets, which is £5,308,000.
This is a change of approach from 2013, where materiality of £11,480,000 was based on 3% of Net Assets. We have changed the percentage applied to align more closely with other comparable companies.
We agreed with the Audit Committee that we would report to the Committee all audit differences in excess of £106,000 (2013: £229,000), as well as differences below that threshold that, in our view, warranted reporting on qualitative grounds. We also report to the Audit Committee on disclosure matters that we identified when assessing the overall presentation of the financial statements.
An overview of the scope of our audit
Our group audit scope focused primarily on the audit work for the parent. The parent was subject to a full audit directly by us, whilst the subsidiary audit involved a component auditor. As group auditor we reviewed the summary of work completed by the component auditor and particularly focussed on work over the valuation and ownership of the investments held by the subsidiary.
Our audit work for the parent and subsidiary company was executed at levels of materiality applicable to each individual entity and which for the subsidiary was lower than group materiality.
Opinion on other matters prescribed by the Companies Act 2006 In our opinion:
• the part of the Directors’ Remuneration Report to be audited has been properly prepared in accordance with the Companies Act 2006; and
• the information given in the Strategic Report and the Directors’ Report for the financial year for which the financial statements are prepared is consistent with the financial statements.
Matters on which we are required to report by exception Adequacy of explanations received and accounting records Under the Companies Act 2006 we are required to report to you if, in our opinion:
• we have not received all the information and explanations we require for our audit; or
• adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or • the parent company financial statements are not in
agreement with the accounting records and returns. We have nothing to report in respect of these matters. Directors’ remuneration
Under the Companies Act 2006 we are also required to report if in our opinion certain disclosures of Directors’ remuneration have not been made or the part of the Directors’ Remuneration Report to be audited is not in agreement with the accounting records and returns. We have nothing to report arising from these matters.
Corporate Governance Statement
Under the Listing Rules we are also required to review the part of the Corporate Governance Statement relating to the Company’s compliance with ten provisions of the UK Corporate Governance Code. We have nothing to report arising from our review.
Our duty to read other information in the Annual Report Under International Standards on Auditing (UK and Ireland), we are required to report to you if, in our opinion, information in the annual report is:
• materially inconsistent with the information in the audited financial statements; or