ETHICAL UNIT TRUST - St. James's Place plc/media/Files/S/sjp-group/... · The synthetic risk and...

ETHICAL UNIT TRUST

FOR THE YEAR ENDING 31 MARCH 2016

I. S. Gascoigne D. J. Lamb

PricewaterhouseCoopers LLPAtria One144 Morrison StreetEdinburgh, EH3 8EXUnited Kingdom

United Kingdom

London, EC4V 4LAUnited Kingdom

RegistrarInternational Financial Data Services (UK) Limited

St. Nicholas LaneBasildon, SS15 5FS

IFDS House

(Authorised and regulated by the Financial Conduct Authority)


Independent Auditor

Prospectus and Manager's Reports

Copies of the up to date Prospectus (Scheme Particulars) and latest Manager's Report andFinancial Statements for the range of St. James's Place Unit Trusts can be requested from amember of the St. James's Place Partnership or, at any time during normal business hours, fromthe Administration Centre at PO Box 9034, Chelmsford CM99 2XA.Freephone: 0800 027 1031


United Kingdom

160 Queen Victoria Street

TrusteeBNY Mellon Trust & Depositary (UK) Limited

10 Queen StreetAberdeen, AB10 1YG


Investment AdviserAberdeen Asset Managers Limited

Directors of the ManagerD. C. BellamyA. M. Croft

Freephone: 0800 027 1031

PO Box 9034, Chelmsford, CM99 2XA

St. James's Place Ethical Unit Trust

ManagerSt. James's Place Unit Trust Group Limited

United Kingdom

1

06/04/99 to 31/03/16

31/03/11 to 31/03/16

31/03/15 to 31/03/16

% change % change % change

+42.5 +1.7 -10.8+64.6 +8.1 -9.7

+131.3 +47.8 -0.6

St. James's Place Ethical Unit TrustIncome units (offer to offer)Accumulation units (offer to offer)

Source: Lipper for Fund returns

REMEMBER THAT THE PRICE OF UNITS AND REVENUE FROM THEM MAY GO DOWN ASWELL AS UP. PLEASE BE AWARE THAT PAST PERFORMANCE IS NOT INDICATIVE OF FUTUREPERFORMANCE.

Risk and Reward ProfileThe synthetic risk and reward indicator for the St. James’s Place Ethical Unit Trust, as disclosed inits most recent Key Investor Information Document (KIID), is a 5. It was calculated usingperformance data up to 1 February 2016.

The risk category is recalculated weekly and during the year under review, the risk category didnot change.

Investment Adviser's Comments

Daito Trust Construction benefited from recent data revealing better-than-expected orders inFebruary amid still-robust housing occupancy levels. For another of the portfolio’s winners,Taiwan Semiconductor Manufacturing, earnings were supported by robust demand in thecommunications and computing sectors.

Top detractors were Casino Guichard Perrachon – sentiment towards the French retailer remainedweak due to its significant exposure to Latin America, particularly Brazil, which is undergoing asharp economic contraction; and Standard Chartered – the lender was weighed down by higherprovisions, a slowing Chinese economy and global growth concerns.We introduced Kasikornbank, with a robust branch network; Fielmann, with an establishedEuropean presence; Temenos, which can benefit from structural growth drivers; Amdocs, withsolid client retention; Aveva, with recurring revenues despite cyclical end-markets; Essilor, whichcan benefit from low rates of market penetration; Samsonite, with strong brands; Shimano, witha sustainable technological advantage; MTR, with robust city-rail operations and propertydevelopments; Whitbread, with competitive positions in its key UK markets; IntercontinentalExchange, with a unique business model; Check Point Software and Mitsubishi Estate, on recentweakness; and Kerry Logistics, with strong warehousing capabilities.

Indices - actualMSCI AC World (Total Return)

The fund fell over the year, significantly underperforming the MSCI AC World GDR Index.Global equities ended flat in a year marked by intense volatility, fuelled by US monetary policyuncertainty, China’s policy gaffes and yuan unease, and a commodities rout. However, sentimentpicked up dramatically towards the period-end, with negative interest rates imposed in Europeand Japan. As expectations were lowered for the number of rate hikes in the US this year, theresulting dollar weakness provided relief to commodity-related emerging markets.

The underweight to the US, stock selection in France and overweight to the UK detracted, whilethe overweight to Taiwan aided performance.


Report of the Manager

The Trust's PerformanceThe performance of the Trust since its launch in April 1999, over the five year period since March2011 and over the year under review is shown below, together with figures for the mostcommonly quoted indices in comparable markets where the major proportion of the Trust hasbeen invested.

The Report of the Manager consists of The Trust's Performance, Risk and Reward Profile,Investment Adviser's Comments and Portfolio Statement.

2

(continued)


Report of the Manager

We remain mindful of slowing global growth, an acceleration in China’s slowdown, anduncertainty over policy-making. Despite the unstable environment, our portfolio continues toreflect the strategy of diversification as we look for businesses that boast relatively uniqueattributes.

We sold Nordea as its growth potential seems limited; Vale, on concerns of supply and demandimbalances; Casino Guichard Perrachon, after it divested its attractive Thai business; ZurichInsurance, on concerns about management strategies and poor results; Engie, as political,environmental and regulatory pressures will likely remain; BHP Billiton, Sysmex, Verizon andViscofan, for failing the fund’s ethical screening; Ericsson and South32, to fund betteropportunities.

Aberdeen Asset Managers Limited 14 April 2016

3


Comparative table

as at 31 March 2016

31/03/16 31/03/15 31/03/14

Income

Change in net assets per unit (p) (p) (p)

Opening net asset value per unit 149.97 138.89 141.33Return before operating charges* (12.28) 15.36 1.42Operating charges (2.18) (2.33) (2.06)

Return after operating charges* (14.46) 13.03 (0.64)

Distributions on income units (1.44) (1.95) (1.80)

Closing net asset value per unit 134.07 149.97 138.89

*after direct transaction costs of: 0.10 0.07 0.07

Performance

Return after charges† (9.64%) 9.38% (0.45%)

Other informationClosing net asset value (£’000) 3,449 4,010 3,980Closing number of units 2,572,963 2,674,206 2,865,414Operating charges** 1.62% 1.62% 1.63%Direct transaction costs 0.07% 0.05% 0.06%

PricesHighest unit price (p) 164.00 162.10 157.50Lowest unit price (p) 118.00 136.30 130.40

Net Asset Value and Ongoing Charges Figure

4


Comparative table (continued)

as at 31 March 201631/03/16 31/03/15 31/03/14

Accumulation

Change in net assets per unit (p) (p) (p)

Opening net asset value per unit 173.29 158.38 159.10Return before operating charges* (14.20) 17.57 1.85Operating charges (2.52) (2.66) (2.57)

Return after operating charges* (16.72) 14.91 (0.72)

Closing net asset value per unit 156.57 173.29 158.38

Retained distributions on accumulation units* 1.66 2.22 2.03

*after direct transaction costs of: 0.11 0.07 0.09

Performance

Return after charges† (9.65%) 9.41% (0.45%)

Other informationClosing net asset value (£’000) 199,068 237,700 223,319Closing number of units 127,143,212 137,168,469 141,002,768Operating charges** 1.62% 1.62% 1.63%Direct transaction costs 0.07% 0.05% 0.06%

PricesHighest unit price (p) 189.40 184.80 177.30Lowest unit price (p) 136.30 155.50 146.80

**Operating charges are prepared using the same methodology as the ongoing chargesappearing in the KIID, based on the information in this report.†This figure may differ from the performance figure quoted in the Investment Report. TheInvestment Report performance figure is calculated using the last available published price for agiven shareclass in the period compared to the equivalent for the prior period. The price per thefinancial statements values the fund on a bid-price basis. The financial statements shareclassvaluation is based on market prices on the last day of the period, which can differ from theintraday pricing point of the Trust.

5

Security Holdings

MarketValue£000

% ofNet

Assets

BERMUDA (0.00%) 4,181 2.06Kerry Logistics Network 4,206,500 4,181 2.06

BRAZIL (4.31%) 3,358 1.66Banco Bradesco ADR 623,890 3,358 1.66

CANADA (6.34%) 12,080 5.96Canadian National Railway 111,800 4,868 2.40Potash Corp of Saskatchewan 296,700 3,590 1.77TELUS 0% 159,200 3,622 1.79

CURACAO (2.19%) 4,798 2.37Schlumberger 92,800 4,798 2.37

FRANCE (5.56%) 5,234 2.59Essilor International 22,500 1,923 0.95Schneider Electric 75,200 3,311 1.64

GERMANY (1.68%) 5,097 2.52Fielmann 40,200 2,117 1.05Linde 29,300 2,980 1.47

GUERNSEY (0.00%) 3,149 1.56Amdocs 75,500 3,149 1.56

HONG KONG (4.21%) 11,777 5.82AIA 1,562,000 6,133 3.03MTR 673,000 2,305 1.14Swire Pacific 'B' Shares 2,472,500 3,339 1.65

ISRAEL (1.04%) 4,928 2.43Check Point Software Technologies 82,200 4,928 2.43

JAPAN (6.59%) 14,562 7.19Daito Trust Construction 50,200 4,956 2.45FANUC 44,700 4,829 2.38Mitsubishi Estate 218,000 2,816 1.39Shimano 18,000 1,961 0.97

JERSEY (2.52%) 6,683 3.30Experian 537,200 6,683 3.30

LUXEMBOURG (2.17%) 6,341 3.13Samsonite International 970,200 2,254 1.11Tenaris ADR 238,400 4,087 2.02

SINGAPORE (5.96%) 13,757 6.79City Developments 476,000 2,006 0.99Oversea-Chinese Banking 1,047,052 4,775 2.36Singapore Telecommunications 3,558,600 6,976 3.44

SOUTH AFRICA (1.89%) 3,158 1.56MTN 509,400 3,158 1.56

SPAIN (1.76%) - -

SWEDEN (5.87%) 3,220 1.59Atlas Copco 'A' Shares 184,100 3,220 1.59

SWITZERLAND (3.55%) 1,996 0.99Temenos 52,769 1,996 0.99

TAIWAN (6.09%) 13,539 6.69Taiwan Mobile 2,749,000 6,168 3.05Taiwan Semiconductor Manufacturing ADR 401,300 7,371 3.64


Portfolio Statement

as at 31 March 2016

6

Security Holdings

MarketValue£000

% ofNet

Assets


Portfolio Statement (continued)

as at 31 March 2016

THAILAND (0.00%) 1,981 0.98

Kasikornbank 'A' Shares 576,800 1,981 0.98

UNITED KINGDOM (13.12%) 24,866 12.27AVEVA 139,300 2,194 1.08John Wood 577,985 3,520 1.74Spirax-Sarco Engineering 112,195 4,079 2.01St. James's Place Money Market Unit Trust L Acc† 1,118,881 1,168 0.58Standard Chartered 659,536 3,081 1.52Vodafone 2,281,400 5,041 2.49Weir 242,200 2,659 1.31Whitbread 78,900 3,124 1.54

UNITED STATES (24.51%) 58,310 28.79Cisco Systems 258,200 5,103 2.52Cognizant Technology Solutions 101,400 4,397 2.17Comcast 'A' Shares 119,800 5,056 2.50EOG Resources 162,400 8,308 4.10Intercontinental Exchange 16,000 2,590 1.28Jones Lang LaSalle 48,400 3,886 1.92M&T Bank 52,900 4,112 2.03Oracle 253,100 7,202 3.56PepsiCo 126,700 9,036 4.46TJX 75,300 4,114 2.03Visa 'A' Shares 84,500 4,506 2.22

Investment assets 203,015 100.25

Total other liabilities (net) (498) (0.25)

Net assets 202,517 100.00

All investments held are listed, unless otherwise stated.

Stocks shown as ADRs represent American Depositary Receipts.

† During the year under review the Manager decided to place some of the sterling cash held ondeposit into the St. James’s Place Money Market Unit Trust in order to spread risk across anumber of institutions. The St. James’s Place Money Market Unit Trust is highly liquid and is ratedAAA by Standard & Poors. This investment is a related party.

Comparative figures shown in brackets relate to 31 March 2015.

7

Material Portfolio Changes

PurchasesCost

£000St. James's Place Money Market Unit Trust L Acc† 40,351Kerry Logistics Network 4,145M&T Bank 4,023Whitbread 3,461Mitsubishi Estate 3,199Amdocs 3,053Intercontinental Exchange 2,765Vodafone 2,442MTR 2,113AVEVA 2,076

SalesProceeds

£000St. James's Place Money Market Unit Trust L Acc† 44,236Zurich Insurance 6,053Sysmex 4,991Casino Guichard Perrachon 4,509Viscofan 4,136BG 3,972Nordea Bank 3,806Vale ADR 3,432Verizon Communications 3,351Comcast 'A' Shares 3,236

† This investment is a related party.Stocks shown as ADRs represent American Depositary Receipts.


8

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London27 May 2016

D. J. LambA. M. Croft

Directors' Certificate

This report is certified in accordance with the requirements of the rules in the Financial ConductAuthority's Collective Investment Schemes Sourcebook.

The Manager is responsible for keeping proper accounting records and for the management ofthe Trust in accordance with its Trust Deed, Prospectus and the Rules. The Manager has ageneral responsibility for taking such steps as are reasonably open to it to prevent and detectfraud and other irregularities.

St. James's Place Ethical Unit TrustStatement of the Manager's Responsibilities in relation to the Financial Statements of the Trust

The rules in the Financial Conduct Authority's Collective Investment Schemes Sourcebook ("theRules") require the Manager to prepare Financial Statements for each annual accounting periodwhich give a true and fair view of the financial position of the Trust as at the end of the year andof the net revenue and the net capital losses on the property of the Trust for the year then ended.

In preparing the Financial Statements the Manager is required to:

select suitable accounting policies and then apply them consistently;

make judgements and estimates that are reasonable and prudent;

comply with the requirements of the Statement of Recommended Practice relating toAuthorised Funds and the Trust Deed;

follow applicable UK Accounting Standards (UK Generally Accepted Accounting Practice);and

prepare Financial Statements on the going concern basis unless it is inappropriate topresume that the Trust will continue in operation.

9

Date 09 April 2016

Having carried out such procedures as we considered necessary to discharge our responsibilitiesas Trustee of the Trust, it is our opinion, based on the information available to us and theexplanations provided, that, in all material respects, the Manager:

(i) has carried out the issue, sale, redemption and cancellation, and calculation of the price of theTrust’s units and the application of the Trust’s income in accordance with the Sourcebook, theTrust Deed and Prospectus, and

(ii) has, observed the investment and borrowing powers and restrictions applicable to the Trust.

BNY Mellon Trust & Depositary (UK) Limited160 Queen Victoria StreetLondon EC4V 4LA

Manager

Report of the Trustee to the unitholders of St. James’s Place Ethical Unit Trust for the yearended 31st March 2016

Report of the Trustee to the unitholders of St. James’s Place Ethical Unit Trust

Trustee's responsibilities

The Trustee is responsible for the safekeeping of all the property of the Trust (other than tangiblemoveable property) which is entrusted to it and for the collection of income that arises from thatproperty.It is the duty of the Trustee to take reasonable care to ensure that the Trust is managed inaccordance with the Financial Conduct Authority’s Collective Investment Schemes Sourcebook(“COLL”), the Trust Deed and Prospectus, in relation to the pricing of, and dealings in, units inthe Trust; the application of income of the Trust; and the investment and borrowing powers andrestrictions applicable to the Trust.

10

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Other matters on which we are required to report by exception

Propriety of accounting records and information and explanations received

Under the Collective Investment Schemes sourcebook we are required to report to you if, in ouropinion:

proper accounting records have not been kept; or

the financial statements are not in agreement with the accounting records and returns.

We have no exceptions to report arising from this responsibility.

Opinions on matters prescribed by the Collective Investment Schemes sourcebookwe have obtained all the information and explanations we consider necessary for thepurposes of the audit; and

the information given in the Authorised Fund Manager’s Report for the financial year forwhich the financial statements are prepared is consistent with the financial statements.

Independent Auditors' Report to the Unitholders of


Our opinionIn our opinion, St. James's Place Ethical Unit Trust's financial statements, (the "financialstatements"):

give a true and fair view of the financial position of the Trust as at 31 March 2016 and ofthe net revenue and the net capital losses of the scheme property of the Trust for the yearthen ended; and

have been properly prepared in accordance with United Kingdom Generally AcceptedAccounting Practice, the Statement of Recommended Practice for UK Authorised Funds, theCollective Investment Schemes sourcebook and the Trust Deed.

What we have audited

The financial statements, which are prepared by St. James’s Place Unit Trust Group Limited (the“Authorised Fund Manager”), comprise:

the balance sheet of the Trust as at 31 March 2016 ;

the statement of total return of the Trust for the year then ended;

the statement of change in net assets attributable to unitholders of the Trust for the yearthen ended;

the notes to the Trust’s financial statements, which include a summary of significantaccounting policies and other explanatory information; and

the distribution tables.The financial reporting framework that has been applied in their preparation is applicable lawand United Kingdom Accounting Standards (United Kingdom Generally Accepted AccountingPractice), the Statement of Recommended Practice ‘Financial Statements of UK Authorised Funds’issued by the Investment Management Association (the “Statement of Recommended Practice forUK Authorised Funds”), the Collective Investment Schemes sourcebook and the Trust Deed.

In applying the financial reporting framework, the Authorised Fund Manager has made a numberof subjective judgements, for example in respect of significant accounting estimates. In makingsuch estimates, they have made assumptions and considered future events.

11

(continued)

Independent Auditors' Report to the Unitholders of


Responsibilities for the financial statements and the audit

Our responsibilities and those of the Authorised Fund Manager

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Chartered Accountants and Statutory AuditorsEdinburgh27 May 2016The maintenance and integrity of the St. James’s Place website is the responsibility of the Fund Manager; the work carried out by theauditors does not involve consideration of these matters and, accordingly, the auditors accept no responsibility for any changes that mayhave occurred to the financial statements since they were initially presented on the website.Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in otherjurisdictions.

PricewaterhouseCoopers LLP

What an audit of financial statements involvesWe conducted our audit in accordance with International Standards on Auditing (UK and Ireland)(“ISAs (UK & Ireland)”). An audit involves obtaining evidence about the amounts and disclosuresin the financial statements sufficient to give reasonable assurance that the financial statementsare free from material misstatement, whether caused by fraud or error. This includes anassessment of:

whether the accounting policies are appropriate to the Trust’s circumstances and have beenconsistently applied and adequately disclosed;

the reasonableness of significant accounting estimates made by the Authorised FundManager; and

the overall presentation of the financial statements.

In addition, we read all the financial and non-financial information in the Annual Report (the “Annual Report”) to identify material inconsistencies with the audited financial statements andto identify any information that is apparently materially incorrect based on, or materiallyinconsistent with, the knowledge acquired by us in the course of performing the audit. If webecome aware of any apparent material misstatements or inconsistencies we consider theimplications for our report.

As explained more fully in the Statement of the Manager's Responsibilities set out on pageĎ3, theAuthorised Fund Manager is responsible for the preparation of the financial statements and forbeing satisfied that they give a true and fair view.

we primarily focus our work in these areas by assessing the directors' judgements againstavailable evidence, forming our own judgements, and evaluating the disclosures in thefinancial statements.

we test and examine information, using sampling and other auditing techniques, to theextent we consider necessary to provide a reasonable basis for us to draw conclusions. Weobtain audit evidence through testing the effectiveness of controls, substantive procedures ora combination of both.

Our responsibility is to audit and express an opinion on the financial statements in accordancewith applicable law and ISAs (UK & Ireland). Those standards require us to comply with theAuditing Practices Board’s Ethical Standards for Auditors.

This report, including the opinions, has been prepared for and only for the Trust’s unitholders as abody in accordance with paragraph 4.5.12 of the Collective Investment Schemes sourcebook andfor no other purpose.

We do not, in giving these opinions, accept or assume responsibility for any other purpose or toany other person to whom this report is shown or into whose hands it may come save whereexpressly agreed by our prior consent in writing.

12

Notes £000 £000 £000 £000

2 (26,128) 17,8193 6,200 7,4124 (3,454) (3,772)

- (1)

2,746 3,6395 (450) (490)

2,296 3,149

(23,832) 20,9686 (2,296) (3,149)

(26,128) 17,819

£000 £000 £000 £000241,710 227,299

31,777 19,208

(46,949) (25,740)

(15,172) (6,532)- (2)

(26,128) 17,8192,107 3,044

- 82

202,517 241,710Closing net assets attributable to unitholders

Change in net assets attributable to unitholders from investment activities (see above)

01/04/15 to 31/03/16 01/04/14 to 31/03/15

Amounts receivable oncreation of units*

Class actionsRetained distribution on accumulation units

Opening net assets attributable to unitholdersMovement due to creation and cancellation of units:

Stamp duty reserve tax

Amounts payable on cancellation of units*

*Prior year figures in relation to Dilution Levy have been reclassified and included withincreations and cancellation of units as this was income and expenses arising from creations andcancellations respectively.

for the year ended 31 March 2016

Revenue

Distributions

Expenses

Net revenue before taxation

Total return before distributions

Interest payable and similar charges

Taxation

Net revenue after taxation

Change in net assets attributable to unitholders from investment activities

Statement of Change in Net Assets Attributable to Unitholders

Net capital (losses)/gains

Statement of Total Return


Income


01/04/15 to 31/03/16 01/04/14 to 31/03/15

13


31/03/2016 31/03/2015

Notes £000 £000 £000

203,015 240,157

7 400 434

8 604 2,113

204,019 242,704

Liabilities

Creditors

(37) (52)

9 (1,465) (942)

(1,502) (994)202,517 241,710

Cash and bank balances

Total assets

Debtors

as at 31 March 2016

Balance Sheet

Assets

Investments

Current assets

Distribution payable

Other creditors

Total liabilitiesNet assets attributable to unitholders

14

1.

(a)

(b)

(c)

(d)

(e)

(f)

Notes to the Financial Statements


Listed investments have been valued at bid market value at 12.00 midday on 31/03/2016(31/03/15: bid market value at 12.00 midday), net of any accrued interest which is includedin the Balance Sheet as a revenue related item.

All expenses of the Trust are recognised on an accruals basis and are deducted from revenuewith the exception of handling charges and stamp duty reserve tax which are deducted fromcapital.

The Financial Statements have been prepared under the historical cost basis, as modified bythe revaluation of investments, in compliance with the Financial Conduct Authority'sCollective Investment Schemes Sourcebook. They have been prepared in accordance withUnited Kingdom Generally Accepted Accounting Practice, including Financial ReportingStandard 102 (The Financial Reporting Standard applicable in the UK and Republic of Ireland FRS 102) and in accordance with the Statement of Recommended Practice (SORP) forFinancial Statements of Authorised Funds issued by the Investment Management AssociationMay 2014 (IMA SORP 2014). Both FRS 102 and SORP 2014 have been adopted in thecurrent year. The changes in the SORP 2014 are presentational only and there have been nochanges to any figures detailed with the financial statements. The financial statements areprepared on the going concern basis.

Transactions involving foreign currencies are converted at the rate ruling on the date of thetransaction.

Deferred tax is provided for on the liability method on all timing differences. A deferred taxasset is only recognised to the extent that a timing difference will be of future benefit.

Valuation of investments


Accounting and Distribution policies

Basis of accounting

Dividends receivable from equity investments are credited to the revenue account when theinvestments are first quoted ex-dividend. Interest on deposits is accounted for on an accrualsbasis. Interest on capital relate to payments made by brazillian corporations as an alternativeform of dividend distribution. Revenue from other authorised collective investment schemesis recognised when the investments are quoted ex-dividend. Management fee rebates fromunderlying funds will be taken to revenue or capital depending on the treatment adopted inthe underlying funds. Management fee rebates received from St. James's Place MoneyMarket Unit Trust are recognised as revenue on an accruals basis and form part of thedistribution.

Revenue

Provision is made for corporation tax at the current rate on the excess of taxable revenueover allowable expenses.

Taxation

Foreign exchange

Assets and liabilities have been translated into sterling at the exchange rates prevailing atthe Balance Sheet date.

UK dividend revenue is disclosed net of any related tax credit. Overseas dividends continueto be disclosed gross of any foreign tax suffered, the tax element being separately disclosedin the tax note.

Authorised unit trusts are valued at cancellation price for funds managed by the managerand a bid price for all other funds. Suspended, delisted, unquoted or manually pricedsecurities are valued by the manager taking into account, where appropriate, latest dealingprices, financial performance and other relevant factors.

Expenses

15

(continued)Notes to the Financial Statements


(g)

(h)

(i)

(j)

2.01/04/15 to

31/03/1601/04/14 to

31/03/15£000 £000

(26,109) 17,910(13) (87)

(6) (4)

(26,128) 17,819

3.01/04/15 to

31/03/1601/04/14 to

31/03/15£000 £000754 1,248

Overseas dividends 4,785 5,484Distributions from Regulated Collective Investment Schemes Interest distributions 5 4Bank interest 1 92Interest on capital 282 400Management charge rebate on underlying holdings 19 21Scrip dividends 354 163

6,200 7,412

Non-derivative securities


Special dividends

Special dividends are treated as revenue or a repayment of capital reflecting the facts ofeach particular case.

The ordinary element of stocks received in lieu of cash dividends is recognised as revenueand where applicable, is included in the distribution. In the case of enhanced scrip dividends, the value of the enhancement is treated as capital.

Scrip dividends

At the end of the accounting period all remaining revenue, less revenue expenses andtaxation, will be attributable to unitholders. In the case of income unitholders this will bepaid as a distribution. In the case of accumulation unitholders the distribution will bereinvested. Equalisation on distributions received is deducted from the cost of theinvestment.

Distribution policy

UK dividends

Revenue

Handling chargesCurrency losses

Total revenue

Equalisation

Equalisation applies only to units purchased during the distribution period. It is the accruedrevenue element of the purchase price of all such units and is refunded to holders of theseunits as a return of capital. Being capital it is not liable to income tax, but must be deductedfrom the cost of units for capital gains tax purposes.


16



4.01/04/15 to

31/03/1601/04/14 to

31/03/15£000 £000

3,094 3,495

13 23

Audit fee 5 9Investment administration fee

99 19714 2330 25

Investment adviser's fee 199 -

347 254

3,454 3,772

5.01/04/15 to

31/03/1601/04/14 to

31/03/15£000 £000

(a)450 490

(b)

2,746 3,639

549 728

(151) (250)(71) (32)

(957) (1,097)630 651450 490

450 490

(c)

(d)

With effect from 26 October 2015 all expenses are now paid by the Manager out of theAnnual Management Charge with exception of the Investment Adviser fee and AMC feerebate. This includes current year Audit Fee of £9,360.

Factors that may affect future tax charges

Effects of:

Non taxable scrip dividendsUK dividends not subject to corporation tax

Factors affecting total tax charge for the year:

The tax assessed for the year is lower than the standard rate of corporation tax in the UK foran authorised unit trust of 20% (2015: 20%). The differences are explained below:Net revenue before taxation

There is no provision required for deferred taxation at the balance sheet date.

Movement in excess management expensesIrrecoverable overseas tax

Total tax charge for year (note 5a)

At the year end, after offset against revenue taxable on receipt, there is a potential deferredtax asset of £4,022,535 (31/03/15: £3,393,322) relating to surplus management expenses.No deferred tax asset was recognised in the current or prior year as it was consideredunlikely the Trust would generate sufficient taxable profits in the future to utilise theseamounts.

Authorised Unit Trusts are exempt from tax on capital gains, therefore any capital return isnot included in the above reconciliation.

Deferred taxation:

Non taxable foreign dividends

Trustee's fee

Corporation Tax at 20% (2015: 20%)

Payable to the Manager

Other expenses

Management charge

Expenses

Safe custody feeADR Issuance fee

Taxation

Irrecoverable overseas taxAnalysis of charge in year:

Registrar's fee

Payable to the Trustee

Total expenses

17



6.

01/04/15 to 31/03/16

01/04/14 to 31/03/15

£000 £000Final distribution 2,144 3,096

455 267(303) (214)

2,296 3,149

7.31/03/2016 31/03/2015

£000 £000390 412

2 -8 22

400 434

8.31/03/2016 31/03/2015

£000 £000231 1,507373 606

604 2,113

9.31/03/2016 31/03/2015

£000 £000818 784369 128278 30

1,465 942

10.

Opening units in issue Creations Cancellations

Units converted

Closing units in issue

2,674,206 19,876,217 (19,977,460) - 2,572,963137,168,469 3,564,833 (13,590,090) - 127,143,212

11.

Total other creditors

Amounts payable for cancellation of unitsAccrued expenses

Reconciliation of the unit movement in the year:

Related party transactions

Cash and bank balances

St. James's Place Unit Trust Group Limited and BNY Mellon Trust & Depositary (UK) Limitedtogether with their associates are related parties and regarded as controlling parties byvirtue of having the ability to act in respect of operations of the Trust.The Manager's service charge paid to St. James's Place Unit Trust Group Limited is shown innote 4 and details of the value of units created and cancelled by St. James's Place Unit TrustGroup Limited are shown in the Statement of Change in Net Assets Attributable toUnitholders. The net balances due to St. James's Place Unit Trust Group Limited at the yearend in respect of these transactions was £602,411 (31/03/15: £127,427).

Other creditors

IncomeAccumulation

Distributions

The distribution takes account of revenue received on the creation of units and revenuededucted on the cancellation of units and comprises:

Deduct: Revenue received on creation of units

Accrued revenueIncome tax recoverable

Add: Revenue deducted on cancellation of units

Units in issue

Cash and bank balances: Overseas

The Manager, St. James's Place Unit Trust Group Limited, is a subsidiary of St. James's PlaceWealth Management Group plc ('SJPWMG'). Two fellow subsidiaries of SJPWMG,St. James's Place International plc and St. James's Place UK plc, invest some of their life andpension policyholders' funds into the St. James's Place Ethical Unit Trust. The value of theseinvestments at the year end was £117,750,037 (31/03/15: £141,081,853).

Total cash and bank balances

Overseas tax recoverable

Debtors

Net distribution for the year

Purchases awaiting settlement

Cash and bank balances: Sterling

Included in the investment portfolio is a holding of 1,118,881 units (31/03/15: 4,840,959)in St. James's Place Money Market Unit Trust (a St. James's Place Unit Trust Group Limitedfund) with a market value of £1,168,042 (31/03/15: £5,047,765). As at 31/03/16 totalrevenue earned amounts to £24,681 (31/03/15: £24,773).

Total debtors

18



12.

13.

●

●

14.

●

●

●

(a)

01/04/15 to 31/03/16

01/04/14 to 31/03/15

% %

15.20 15.2015.24 15.2115.23 15.21Average monthly VaR

Initial and ongoing due diligence of Investment Adviser investment and risk managementprocedures – including on site reviews;

Periodic reviews of the investments held by the Trust and their compliance with investmentobjectives and liquidity requirements; and

Risk management

The rules in the Scheme Documents set out the financial instruments in which the Trust mayinvest. The Trust's use of financial instruments during the year satisfies these requirements.

Cash (including overdrafts) and short-term debtors and creditors that arise directly from itsoperations.

Financial instruments

Market price risk represents the potential loss the Trust might suffer through holding marketpositions in the face of price movements.

Market price risk

The sensitivity of the fund to market risk is calculated using the Value-at-Risk (VaR)approach. VaR is a mathematical-statistical concept and is commonly used as a standardmeasure of risk in the financial sector. The maximum potential loss that a fund could sufferunder normal market conditions within a given time horizon and a certain degree ofconfidence is estimated. An absolute VaR is calculated using the historic return series of each fund. Using the Historical VaR approach, a 1% 20-day VaR using 10 years of historical dailydata is calculated. An annualised VaR limit of 20% is considered for the fund.

Capital commitments and contingent liabilities

On 31 March 2016, the Trust had no capital commitments (31/03/15: £nil) and nocontingent liabilities (31/03/15: £nil).

The Manager has delegated the investment management of the portfolio to an externalInvestment Adviser who determines the asset allocation and minimises the risk associatedwith particular countries or industry sectors, whilst continuing to follow the Trust’sinvestment objectives. The Manager has the responsibility for monitoring the portfolio toensure compliance with the investment objectives and that an acceptable risk and rewardprofile is maintained.

In accordance with the investment objectives, as stated on page 25, the Trust held certainfinancial instruments. These comprise:

The actual VaR is summarised in the table below:

Ongoing review of the investment performance of the Trust against appropriate benchmarks.

Equity shares and units in collective investment schemes; and.

The Manager’s objectives in managing investment risk are to ensure that the investmentprofile of the Trust is consistent with its stated investment objectives and risk profile, and toensure appropriate liquidity. Day to day responsibility for managing investment risk isdelegated to the Investment Adviser, who is required to manage the Trust in accordancewith FCA regulations, the Prospectus and the terms of their Investment ManagementAgreement with the Manager. The Manager monitors the activities of the InvestmentAdviser, through a variety of mechanisms including the following:

The main risks arising from the Trust's financial instruments are market price risk, foreigncurrency risk, interest rate risk, credit risk and liquidity risk. The Manager's policies formanaging these risks are summarised below. These policies have remained unchangedsince the beginning of the year to which these financial statements relate (same for 2014).

Lowest monthly VaRHighest monthly VaR

19



(b)

●

●

●

31/03/2016 31/03/2015Total Total£000 £000

30,917 39,1171 1

7,262 8,9941,359 8,574

10,430 22,08418,212 10,15514,681 16,048

3,220 14,17313,757 14,403

1,981 -6,173 6,528

91,187 97,0543,337 4,579

202,517 241,710

(c)

The revenue and capital value of the Trust’s investments can be significantly affected bycurrency translation movements as a proportion of the Trust’s assets and revenue aredenominated in currencies other than sterling, which is the Trust’s functional currency.

Foreign currency risk

Movements in exchange rates affect the value of investments;

The Manager has identified three principal areas where foreign currency risk could impactthe Trust:

Movements in exchange rates affect short term timing differences; and

Interest receivable on bank deposits or payable on bank overdraft positions will be affectedby fluctuations in interest rates.

Interest rate risk

SEKSGDTHBTWDUSDZAR

The Trust may be subject to short term exposure to exchange rate movements, for instancewhere there is a difference between the date an investment purchase or sale is entered intoand the date when settlement of the proceeds occurs. When the Trust enters into such atransaction which will involve the buying or selling of foreign currency in order to complete,a foreign exchange contract is entered into as soon as possible after the initial transaction inorder to minimise the exchange rate risk.

The Trust receives revenue in currencies other than sterling and movements in exchangerates can affect the sterling values of this revenue. The Trust converts all receipts of revenueinto sterling on or near the date of receipt, it does not however hedge or otherwise seek toavoid exchange rate risk on revenue accrued but not received.

An analysis for all currencies at the year end is shown below:

Movements in exchange rates affect revenue received.

Net foreign currency assets

EURHKD

GBPAUDCADCHF

Total

Currency

JPY

20



(d)

(e)

(f)

(g)

(h)

Credit risk

Certain transactions in securities that the Trust enters into expose it to the risk that thecounterparty will not deliver the investment (purchase) or cash (sale) after the fund hasfulfilled its responsibilities.

Credit risk occurs where there is a risk associated with the uncertainty of a counterparty’sability to meet its obligations. This risk is managed by reviewing the counterparty’s creditrating, at the time of purchase and on an ongoing basis, and ensuring that the portfolio issufficiently diversified. The impact of movements in credit rating and spread, and their effecton market prices, is considered to be part of market price risk, which is discussed above.

Liquidity risk arises where liabilities cannot be met when they fall due or can only be met atan uneconomic price. For instance, this could arise if the Trust faces significant redemptionsin a short period of time. In order to manage this risk the manager monitors the Trust withthe aim of ensuring that it contains diversified liquid assets, that the Trust possessessufficient liquidity for the purpose of meeting the redemption of units, and that the Trust hassources of borrowing available to it.

The Manager may use derivative instruments to hedge the value of the investment portfolioagainst market and stock specific risk through investment in warrants, options and futures.The purpose of the financial instruments is efficient portfolio management. In particularfutures may be used to implement the investment policy in a timely manner and to managemarket risk arising from the time lag between funds being receivable or payable by the Trustand investment and disinvestment in underlying securities. No such derivatives were held bythe Trust in the year to 31 March 2016.

The external Investment Adviser selects acceptable counterparties through whichinvestments are bought and sold. The Manager has responsibility for monitoring the processby which these counterparties are selected to minimise risk.

The Trust’s investments and cash are held on its behalf by State Street Bank and TrustCompany (acting as agent), the custodian to the Trust, and its appointed sub custodians.Bankruptcy or insolvency of the custodian or its sub custodians may cause the Trust’s rightswith respect to securities to be delayed. This risk is managed through ongoing monitoringof the custodian and periodic reviews of its procedures for selecting and monitoring subcustodians, together with ad hoc reviews of custodian and sub custodian credit ratings.

Derivative risk

All financial liabilities of the Trust at the year end are due to settle in one year or less, or ondemand.

Fair value of financial assets and liabilities

There is no material difference between the value of the financial assets and liabilities, asshown in the Balance Sheet, and their fair values.

Liquidity risk

Maturity profile of financial liabilities

21



15.

01/04/15 to 31/03/16

01/04/14 to 31/03/15

01/04/15 to 31/03/16

01/04/14 to 31/03/15

£000 £000 £000 £00040,351 48,886 44,236 46,16052,186 38,210 59,421 42,580

92,537 87,096 103,657 88,740

- - - -44 40 (43) (41)

44 40 (43) (41)

- - - -64 24 - -

64 24 - -

108 64 (43) (41)

92,645 87,160 103,614 88,699

01/04/15 to 31/03/16

01/04/14 to 31/03/15

01/04/15 to 31/03/16

01/04/14 to 31/03/15

% % % %

- - - -0.08 0.10 0.07 0.10

- - - -0.12 0.06 - -

Total costs

Trades in the year before transaction costs

Commissions

Taxes

Portfolio transaction costs

Analysis of total trade costs.

Purchases Sales

Total commissions

Collective Investment SchemesEquities



Commissions

Trades in the year after transaction costs


Total taxes

Total transaction cost expressed as a percentage of asset type cost.Purchases Sales

TaxesCollective Investment SchemesEquities

Total transaction costs expressed as a percentage of net asset value.

01/04/15 to 31/03/16 01/04/14 to 31/03/15

Taxes

Total costs

%%Commissions 0.04

0.03

0.07

0.040.01

0.05

Average portfolio dealing spread

The average portfolio dealing spread at the balance sheet date was 0.13% (31/03/15: 0.06%).

22



16.

Assets Liabilities Assets Liabilities£000 £000 £000 £000

Level 1 201,847 - 235,109 -Level 2 1,168 - 5,048 -Level 3 - - - -

Total fair value 203,015 - 240,157 -

Level 1: The unadjusted quoted price in an active market for identical assets or liabilities thatthe entity can access at the measurement date.

Level 2: Inputs other than quoted prices included within Level 1 that are observable (i.e.developed using market data) for the asset or liability, either directly or indirectly.

Level 3: Inputs are unobservable (i.e. for which market data is unavailable) for the asset orliability.

Fair value

Valuation technique

31/03/2016 31/03/2015

The intention of a fair value measurement is to estimate the price at which an asset or aliability could be exchanged in the market conditions prevailing at the measurement date.The measurement assumes the exchange is an orderly transaction (that is, it is not a forcedtransaction, involuntary liquidation or distress sale) between knowledgeable, willingparticipants on an independent basis. The purpose of the fair value hierarchy is to prioritise the inputs that should be used to

measure the fair value of assets and liabilities. The highest priority is given to quoted prices at which a transaction can be entered into and

the lowest priority to unobservable inputs. The fund has early adopted the March 2016 amendment to section 34 of FRS102 (Fair ValueHierarchy disclosures that simplify preparation of financial instrument disclosure), which isapplicable to accounting periods beginning on or after 1 January 2017 with earlierapplication permitted. In accordance with FRS102 the fund classifies fair value measurement under the following

levels:

23

Group 1

Group 2

Netrevenue Equalisation


31/05/16

Distribution paid

31/05/15

Group 1 (p) (p) (p) (p)Final 1.435 - 1.435 1.947

Group 2 (p) (p) (p) (p)Final 0.198 1.237 1.435 1.947

Netrevenue Equalisation


31/05/16

Distribution paid

31/05/15

Group 1 (p) (p) (p) (p)Final 1.657 - 1.657 2.219

Group 2 (p) (p) (p) (p)Final 0.202 1.456 1.657 2.219

Final Units purchased on or after 1 April 2015 to 31 March 2016

Final Units purchased prior to 1 April 2015


Distribution Tables

Distribution in pence per unit

Income

Accumulation

24

(a)

(b)

Management Charges

A Preliminary Charge of 5 per cent which is included in the offer price of the Units.

With effect from 26 October 2015 the Manager changed the charging structure of the Scheme.The annual management charge has been adjusted to include many of the predictable costs,such as trustee fees and administration fees, which were previously charged directly to theScheme, and to exclude the fees for Investment Advisers, which are now charged directly to theScheme. These changes were presentational only and there has been no overall increase in thetotal charges met by the Scheme. In addition, the way the annual management charge iscalculated has been changed. The charge was previously calculated monthly, based on theScheme value on the first business day of the month; with effect from 26 October 2015 it iscalculated daily, based on the Scheme value every day.

The Trust Deed permits the following management charges which are receivable by theManager:

An Annual Management Charge at a rate of 1.37 per cent (1.5 per cent prior to 26 October2015) of the value of the Trust.

The minimum lump sum investment is £1,500, thereafter the minimum additional investment is£1,000. The minimum monthly investment is £150 and the minimum monthly increment is £50.The minimum annual investment is £1,500 and the minimum annual increment is £500.

Minimum Investment

The most recent issue and redemption prices will be published on the Manager's website:www.sjp.co.uk and are available by calling the Administration Centre on 0800 027 1031.

A contract note confirming the subscription or redemption price and the number of unitsinvolved will be forwarded, together with a cancellation notice, where appropriate, on the nextbusiness day.

St. James's Place Ethical Unit Trust is an authorised Unit Trust scheme under section 243 of theFinancial Services and Markets Act (2000) and is constituted by a Trust Deed dated 12 February1999.


General Information

The Trust

The Unit Trust is subject to the rules of the Financial Conduct Authority's Collective InvestmentScheme Sourcebook and is classified as a UCITS Scheme.

The Trust Manager

The Manager of the Trust is St. James's Place Unit Trust Group Limited which is authorised andregulated by the Financial Conduct Authority.

Investment Objectives

The investment objective of the Scheme is to achieve capital appreciation over the medium tolong term, by investing worldwide in companies that meet generally accepted ethical criteria (astatement of the ethical investment principles is available on request). The Scheme will investprincipally in equities and convertible stock and may hold fixed interest securities. In selectingassets, the Manager will not knowingly invest in any company, industry or country whosebusiness or behaviour offends against generally accepted ethical criteria.

The Scheme is permitted to invest in derivative and forward transactions for the purposes ofefficient portfolio management (including hedging).

It is the Manager's intention that the assets of the Unit Trust will be invested so that the UnitTrust will be eligible for inclusion in an ISA.

Unit Dealings

Dealings on the Trust take place on a daily basis. Purchase or sale instructions can be made bytelephone or in writing to St. James's Place Unit Trust Group Limited, PO Box 9034, Chelmsford,CM99 2XA, United Kingdom, freephone: 0800 027 1031.

The Manager adopts a policy of forward pricing, i.e. the order will be transacted on the dealingday following receipt of the client's instructions, or if received before noon, on that dealing day.

In the case of telephone purchases of units from the Manager, settlement must be by return ofpost after receipt of the contract note. In the case of telephone redemptions, the proceeds willnot become payable until the receipt at the Administration Centre of a written request.

25


General Information (continued)

To calculate capital gains on accumulation units, the total amount of reinvested net revenue(shown on the annual tax credit vouchers) should be added to the base cost of the unitspurchased. Unitholders should consult their professional advisers for any advice regarding theirtax position.

Income unitholders that receive income distributions by direct credit and accumulationunitholders (where the distribution income is reinvested) receive an annual consolidated taxvoucher in May with all the relevant payment and tax information required to complete a taxreturn.

Tax vouchers will be enclosed if income unitholders receive payment by cheque.

Report

A report is sent semi-annually to all unitholders on or before 31 May and 30 November.

Capital Gains Tax

The Trust is not liable to tax on capital gains and any individual holding units will not be liable tocapital gains tax unless the total chargeable gains for the tax year 2016/2017 exceed £11,100(2015/2016 £11,100).

Income Distributions

Tax Vouchers

Income distributions are made annually on or before the 31 May.

Accumulation Distributions

Revenue due to accumulation unitholders is reflected in the price of their units.

Following the implementation of UCITS V in the UK on 18 March 2016, all authorised UCITSManagers are required to comply with the UCITS V Remuneration Code from the start of theirnext accounting year. Under the UCITS V Directive, the Manager is required to discloseinformation relating to the remuneration paid to its staff for the financial year, split into fixedand variable remuneration. The Manager’s Financial Year end is 31 December, it is thereforeanticipated that the Manager’s Remuneration Policy and associated financial disclosures will bemade within the Annual Reports starting from 31 December 2017, following its first fullperformance period. Prior to this date, and in line with the FCA's guidance on the UCITS Vremuneration disclosures, the Manager would be part way through its first performance periodand the information available would not be relevant or provide a proper basis for comparison.

RemunerationSt. James’s Place PLC (“SJP PLC”) personnel providing services to St. James’s Place Unit TrustGroup Limited (“the Manager ”) are subject to the SJP PLC Remuneration Policy (the“Remuneration Policy”). The Remuneration Policy reflects the remuneration requirements ofthe UCITS V Directive (2014/91/EU). Details of the Remuneration Policy are available throughwww1.sjp.co.uk/about-st-james-place/our-responsibilities/corporate-governance which isupdated periodically to reflect changes to the policy.

26

St. James’s Place Unit Trust Group Ltd is authorised and regulated by the Financial Conduct Authority. St. James’s Place Unit Trust Group Ltd Registered Office:

St. James’s Place House, 1 Tetbury Road, Cirencester, Gloucestershire, GL7 1FP, United Kingdom. Registered in England Number 947644.

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