Carbon Fund 2019 Annual Report

Annual Report
For the period ended 31 March 2019
CarbonFund
Managed by Salt Funds Management

Carbon Fund Annual Report 2019
2
Table of contents
1.0 Details of Scheme 2
2.0 Information on contributions & Scheme participants 2
3.0 Changes relating to the Scheme 2
4.0 Other information for particular types of managed fund 2
5.0 Changes to persons involved in the Scheme 3
6.0 How to find further information 3
7.0 Contact details & complaints 3
8.0 Financial Statements 5
1.0 - DETAILS OF SCHEME
Name of Scheme
Salt Listed Funds (‘Scheme’)
Type of Scheme
Managed Fund
Name of Manager
Salt Investment Funds Limited
Name of Supervisor
The New Zealand Guardian Trust Company Limited
Date and Status of Latest PDS
12 October 2018 and open for applications
Latest Fund Updates for Scheme
The latest fund update for the Carbon Fund is dated 31 March 2019
Latest Financial Statements
The Scheme’s latest financial statements for the period ended 31 March 2019, including the auditor’s report relating to those
statements, that have been lodged with the Registrar are included in this annual report.
2.0 - INFORMATION ON CONTRIBUTIONS & SCHEME PARTICIPANTS
Number of Managed Investment Products (units) on issue:
1 April 201831 March 2019
Carbon Fundn/a1,527,333
3.0 - CHANGES RELATING TO THE SCHEME
No material changes were made to the scheme during the 2019 accounting period.
4.0 - OTHER INFORMATION FOR PARTICULAR TYPES OF MANAGED FUNDS
The unit prices for the Fund at the initial issue and allotment date and the end of the accounting period are shown
below:
7 November 201831 March 2019
Carbon Fund1.00001.0125

Carbon Fund Annual Report 2019
3
5.0 - CHANGES TO PERSONS INVOLVED IN THE SCHEME
During the accounting period, Kirsty Campbell was appointed as an independent director of Salt Investment Funds
Limited on 14 December 2018.
Anthony Sowerby resigned as Chief Operating Officer of Salt Funds Management Limited, the owner of the Manager,
effective 13 July 2018. Roger Clayton was appointed Chief Operating Officer of Salt Funds Management Limited,
effective 1 August 2018.
There were no changes to the Scheme’s Supervisor.
There were no changes in control (within the meaning of clause 48 of Schedule 1 of the FMCA) of the Manager during
the accounting period.
6.0 - HOW TO FIND FURTHER INFORMATION
Further information relating to the Scheme, including financial statements, PDS, annual reports, quarterly fund
updates, the master trust deed and establishment deed for the Fund, and SIPO, is available on the offer register (offer
number OFR12502) and the scheme register (scheme number SCH12498) free of charge at www.companiesoffice.govt.
nz/disclose.
A copy of the information on the offer register or scheme register is available on request from the Registrar of Financial
Service Providers.
You may also receive a statement of the units held within 14 days of allotment of your investment.
Quarterly fund updates and the information on the offer register or scheme register can also be obtained, free of
charge from our website www.carbonfund.co.nz and on request to info@carbonfund.co.nz.
You can inspect documents we hold that are relevant to you, and other documents legally required to be provided to
you, at our offices during normal business hours, or request an extract of those documents, by written request to us.
These will be provided free of charge. Direct investors in the Fund can also obtain an estimate of unit holdings in the
same way.
You can find general information about us, Salt Funds Management Limited, and the investment management team on
our website at www.saltfunds.co.nz.

7.0 - CONTACT DETAILS & COMPLAINTS
Manager
Salt Investment Funds Limited
Level 3, 44 Queen Street, 1010
PO Box 106-587, 1143
Auckland
09 869 2933
Supervisor
The New Zealand Guardian Trust Company Limited
Level 14, 191 Queen Street, 1010
Auckland
09 909 5100 or 0800 87 87 82
Securities Registrar
Link Market Services Limited
PO Box 91976, Auckland, 1142
Level 11, Deloitte Centre, 80 Queen Street, 1010
Auckland
09 375 5990

Carbon Fund Annual Report 2019
4
Complaints
Queries or complaints about units in the Fund, the offer of units, or the Scheme can be made to:
Salt Investment Funds Limited
PO Box 106-587, 1143
Auckland
Attn: Operations Manager
Phone: 09 869 2933
Email: info@carbonfund.co.nz
You can also lodge a complaint with the Supervisor at the contact details provided above.
We and the Supervisor are each a member of an approved dispute resolution scheme operated by Financial Services
Complaints Limited (FSCL). If you have complained to us and you have reached the end of our internal complaints
process without your complaint being resolved to your satisfaction, FSCL may be able to consider your complaint. FSCL
will not charge a fee to any complainant to investigate or resolve a complaint.
You can contact FSCL at:
Financial Services Complaints Limited
PO Box 5967, 6145
Wellington
Phone: 0800 347 257
Email: complaints@fscl.org.nz

Carbon Fund Annual Report 2019
5
Salt Carbon Fund
Financial Statements
For the period ended 31 March 2019
Manager's Statement
In the opinion of the Manager, the accompanying Financial Statements are drawn up so as to present fairly the financial position of
the Salt Carbon Fund as at 31 March 2019 and the results for the period ended on that date in accordance with the requirements of
the Master Trust Deed dated 12 October 2018.
Director Director
Salt Investment Funds Limited
20 June 2019
Additional Unitholder Information
Notice of Trust Deed Amendment
Under clause 31.2 of the Trust Deed governing the Salt Carbon Fund, the Manager, Salt Investment Funds Limited, is required to
advise unitholders in summary form of any amendments to the Trust Deed.
There has been no amendment to the Trust Deed during the period covered by the Financial Statements.
Statement of Comprehensive Income
$
For the period ended 31 March
NoteSalt Carbon Fund
2019
Income
Interest income on financial assets at amortised cost
576
Net gain/(loss) on financial assets and liabilities at fair value through profit or loss
32,231
Total income/(loss) 32,807
Expenses
Management fees
10.25,076
Other expenses
15
Total operating expenses 5,091
Operating (loss)/profit before tax 27,716
Income tax expense
6 (7,760)
Total comprehensive income for the period attributable to Unitholders 19,956
Earnings per unit
Basic and diluted earnings per unit (cents per unit)
7 1.47
These statements are to be read in conjunction with the accompanying notes.

Carbon Fund Annual Report 2019
6
Statement of Change in Net Assets Attributable to Unitholders
$
For the period ended 31 March
NoteSalt Carbon Fund
2019
Net assets attributable to Unitholders at the beginning of the period -
Proceeds from units issued
1,526,500
Redemption of units
-
Distributions
-
Net increase/(decrease) from transaction in units 1,526,500
Total comprehensive income for the period attributable to Unitholders
19,956
Net assets attributable to Unitholders at the end of the period 1,546,456
Units
For the period ended 31 March
Salt Carbon Fund
2019
Units on issue at the beginning of the period
-
Units issued
1,527,333
Units redeemed
-
Units on issue at the end of the period 1,527,333
These statements are to be read in conjunction with the accompanying notes
Statement of Financial Position
$
As at 31 March
NoteSalt Carbon Fund
2019
Current assets
Cash and cash equivalents
9,782
Financial assets held at fair value through profit or loss
8 1,545,591
Total assets 1,555,373
Current liabilities
Related party payables
10.2 1,157
Income tax payable
6 7,760

Total liabilities 8,917
Unitholders' Funds 1,546,456
The Directors of Salt Investment Funds Limited authorised these Financial Statements for issue on 20 June 2019.


Director Director

These statements are to be read in conjunction with the accompanying notes.

Carbon Fund Annual Report 2019
7
Statement of Cash Flows
$
For the period ended 31 March
NoteSalt Carbon Fund
2019
Cash flows from operating activities
Proceeds from sale of financial assets
-
Purchase of financial assets
(1,513,360)
Interest income received
575
Operating expenses paid
(3,933)

Net cash (outflow)/inflow from operating activities11 (1,516,718)
Cash flows from financing activities
Proceeds from units issued
1,526,500
Net cash inflow/(outflow) from financing activities 1,526,500
Net increase in cash and cash equivalents 9,782
Cash and cash equivalents at the end of the period 9,782
These statements are to be read in conjunction with the accompanying notes.

Carbon Fund Annual Report 2019
8
Notes to the Financial Statements
1. General information
Reporting Entities
The reporting entity included in these Financial Statements is Salt Carbon Fund that is referred to throughout these Financial
Statements as "The Fund". The Fund is a for-profit Fund registered in New Zealand and established under the Financial Markets
Conduct Act 2013 ("The Act"). These Financial Statements are for the period ended 31 March 2019.
The Fund was created under a Master Trust Deed and an Establishment Deed, both dated 12 October 2018. Salt Investment Funds
Limited (the "Manager") and The New Zealand Guardian Trust Company Limited are party to the Deeds. The Fund commenced
operations on 8 November 2018. The Financial Statements are for the period from the date of establishment, 12 October 2018 to 31
March 2019. Given this, there are no comparatives to disclose.
The Fund's units are quoted on the NZX Main Board operated by NZX Limited (under code "CO2"). The Fund is a managed investment
scheme with the aim to provide investors with a total return exposure to movements in the price of carbon credits. The Fund has
the ability to buy carbon credits in emissions trading schemes in New Zealand and offshore. As a result, the Fund may also provide
exposure to the price of carbon offshore.
The Fund's investment activities are managed by Salt Investment Funds Limited. The registered office for Salt Investment Funds
Limited is Level 3, The Imperial Buildings, 44 Queen Street, Auckland. The Fund is domiciled in New Zealand.
These Financial Statements were authorised for issue by the Board of Directors of the Manager on 20 June 2019.
Statutory Base
The Financial Statements have been prepared in accordance with the Act, the Master Trust Deed and the Financial Reporting Act
2013.
Basis of preparation
The Financial Statements have been prepared in accordance with New Zealand Generally Accepted Accounting Practice ("NZ GAAP").
They comply with New Zealand equivalents to International Financial Reporting Standards ("NZ IFRS") and other applicable Financial
Reporting Standards, as appropriate for for-profit entities. The Financial Statements also comply with International Financial Reporting
Standards ("IFRS").
The preparation of Financial Statements in conformity with NZ IFRS requires the use of certain critical accounting estimates. It also
requires the directors of the Manager to exercise their judgement in the process of applying the Fund's accounting policies. The areas
involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the Financial
Statements are disclosed in note 3.
2. Summary of significant accounting policies
The principal accounting policies applied in the preparation of these Financial Statements are set out below. These policies have been
consistently applied throughout the period presented, unless otherwise stated.
2.1. Financial instruments
(a) Classification
Assets
Financial assets are recognised initially at fair value. After initial recognition, financial assets are measured at fair value or amortised
cost, determined on the basis of both (a) the Fund's business model for managing the financial assets; and (b) the contractual cash
flow characteristics of the financial asset.
(i) Financial assets at fair value through profit or loss
Financial assets at fair value through profit or loss can be either designated as such upon initial recognition or mandatorily
measured at fair value in accordance with NZ IFRS 9 Financial Instruments . The portfolio of financial assets is managed and
performance is evaluated on a fair value basis. The Fund is primarily focused on fair value information and uses that information
to assess the assets' performance and to make decisions. As there are no financial instruments designated at fair value upon initial
recognition in the Fund, all financial assets measured at fair value are those mandatorily measured at fair value. Financial assets at
fair value through profit or loss comprise of carbon credits.
(ii) Financial assets at amortised cost
(a) Cash and cash equivalents include cash at bank.
(b) Receivables are amounts representing assets owing to the Fund and may include amounts due for interest and amounts due for
securities sold that have been contracted for, but not yet delivered by the end of the accounting period.

Carbon Fund Annual Report 2019
9
Liabilities
(i) Financial liabilities at amortised cost
(a) Payables are amounts representing liabilities and accrued expenses owing by the Fund at period end and may include related
party fees and amounts due to brokers for purchase of unsettled securities at year end.
(b) Recognition, measurement and derecognition
(i) Financial assets at fair value through profit or loss
The Fund recognises financial assets at fair value through profit or loss on the date they become parties to the contractual
agreement. Financial assets at fair value through profit or loss are initially recognised at fair value. Transaction costs are expensed
as incurred in the Statement of Comprehensive Income.
Subsequent to initial recognition, all financial assets at fair value through profit or loss are measured at fair value. Gains and losses
arising from changes in the fair value are recognised in the Statement of Comprehensive Income when they arise.

Financial assets at fair value through profit or loss are derecognised when the rights to receive cash flows from the investments
have expired or the Fund has transferred substantially all of the risks and rewards of ownership. Any gain or loss arising on
derecognition of the financial asset at fair value through profit or loss is included in the Statement of Comprehensive Income in the
year the item is derecognised.
(ii) Financial assets and liabilities at amortised cost
The Fund recognises financial assets and liabilities at amortised cost on the date they become parties to the contractual
agreement. Financial assets and liabilities at amortised cost are initially recognised at fair value plus transaction costs (if any).
Subsequent to initial recognition, all financial assets and liabilities at amortised cost are measured at amortised cost less any
impairment. Any impairment charge is recognised in the Statement of Comprehensive Income. At each reporting date, the Fund
measures the loss allowance of all financial assets at amortised cost at an amount equal to the lifetime expected credit losses if the
credit risk has increased significantly since initial recognition. If, at the reporting date, the credit risk has not increased significantly
since initial recognition, the Fund measures the loss allowance at an amount equal to 12 month expected credit losses. If the credit
risk increases to the point that it is considered to be credit impaired, interest income is calculated based on the gross carrying
amount adjusted for the loss allowance. A significant increase in credit risk is defined by management as any contractual payment
which is more than 30 days past due or a counterparty credit rating which has fallen below BBB/Baa. Any contractual payment
which is more than 90 days past due is considered credit impaired.
Financial assets at amortised cost are derecognised when the rights to receive cash flows from the investments have expired or the
Fund has transferred substantially all of the risks and rewards of ownership. Financial liabilities at amortised cost are derecognised
when the obligation under the liability is discharged, cancelled or expires.
(c) Fair value estimation
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market
participants at the measurement date.
Fair value in an active market
The fair value of financial assets and liabilities traded in active markets are based on quoted market prices at the Balance Date. The
quoted market price used by the Funds is the last traded market price for both financial assets where the last traded prices fall within
the bid-ask spread. In circumstances where the last traded price is not within the bid-ask spread, management will determine the
point within the bid-ask spread that is most representative of fair value.
Fair value in an inactive or unquoted market
The fair value of financial assets and liabilities that are not traded in an active market is derived and determined from quoted prices
in markets not considered to be active or, from inputs other than quoted prices that are observable for the asset or liability, either
directly or indirectly, or from inputs that are not based on observable market data. The Fund uses a variety of methods and makes
assumptions that are based on market conditions existing at each balance date. Valuation techniques used include the use of recent
arm’s length market transactions, reference to other instruments that are substantially the same, discounted cash flow analysis,
option pricing models and other valuation techniques commonly used by market participants making the maximum use of market
inputs and relying as little as possible on entity-specific inputs.
2.2 Net assets attributable to unitholders
The Fund issues units, which provide the Unitholder with a beneficial equity interest in the Fund. The units are issued based on the
Fund's net asset value per unit at the time of issue. As stipulated in the Trust Deed, each unit represents an individual share in the
Fund and does not extend to a right in the underlying assets of the Fund. There are no separate classes of units within the Fund and
each unit has the same rights attaching to it as all other units in the Fund.
Applications received for units in the Fund are recorded prior to the issue of units in the Fund. Units are issued at the holder's option
at prices based on the Fund's net asset value per unit at the time of issue. The Fund's net asset value per unit is calculated by dividing

Carbon Fund Annual Report 2019
10
the net assets attributable to the holders of the Fund with the total number of outstanding units of the Fund. In accordance with
the provisions of the offering documents, investment positions are valued based at the appropriate market price for the purpose of
determining the net asset value per unit for subscriptions. The units in the Fund are quoted on the NZX Main Board and investments
can be sold through NZX Participants (brokers or financial advisers). Units in the Fund are generally not redeemable for cash.

In accordance with the Trust Deed, the Manager has full discretion as to whether to distribute any net income of the Fund. Although
the Manager does not currently intend to make distributions, they may do so in the future, from the income or capital of the Fund.
2.3 Investment income
Interest income
Interest income on assets held at amortised cost is included as interest in profit or loss in the Statement of Comprehensive Income on
an accruals basis using the effective interest rate method. Changes in fair value for such instruments are recorded in accordance with
the policies described in note 2.1.
Net gains and losses on financial assets at fair value through profit or loss
Realised and unrealised gains and losses are reflected in the Statement of Comprehensive Income as net gain/(loss) on financial
instruments at fair value through profit or loss. Unrealised gains or losses include the change in net market value of investments held
at the end of the reporting period and the reversal of prior periods' unrealised gains or losses on investments that have been realised
in the current period. Realised gains or losses are calculated based on the gross sale proceeds and the weighted average cost of the
investments sold.
2.4 Expenses
All expenses, including the management fees, are recognised in the Statement of Comprehensive Income on an accruals basis.
2.5 Foreign currency translation
(a) Functional and presentation currency
Items included in the Fund's Financial Statements are measured using the currency of the primary economic environment in which
they operate (the "functional currency"). The functional currency for the Fund is the New Zealand dollar, which reflects the currency
in which the Fund competes for funds and is regulated. The Fund's investors are from New Zealand, with the subscriptions and
redemptions of the units denominated in New Zealand dollars. The performance of the Fund is measured in New Zealand dollars.
The Manager considers the New Zealand dollar as the currency that most faithfully represents the economic effects of the underlying
transactions, events and conditions. The Financial Statements are presented in New Zealand dollars, which is also the Fund's
presentation currency.
(b) Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the
transactions. Foreign currency assets and liabilities are translated into the functional currency using the exchange rate prevailing at
the balance date.
Foreign exchange gains and losses resulting from translation are included in the Statement of Comprehensive Income.
Foreign exchange gains and losses relating to cash and cash equivalents are presented in the Statement of Comprehensive Income
within 'net foreign currency gain/(loss) on cash and cash equivalents'.

Foreign exchange gains and losses relating to the financial assets and liabilities carried at fair value through profit or loss are
presented in the Statement of Comprehensive Income within 'Net gain/(loss) on financial assets and liabilities at fair value through
profit and loss".
2.6 Income tax
The Fund is domiciled in New Zealand and is registered as a listed Portfolio Investment Entity ('PIE').
The Fund is liable for tax at the prevailing company tax rate (28%) on taxable interest and dividends and gains and losses from its
investments after the deduction of management fees and other deductible expenses. The Fund pays tax to cover the tax liability in
full.
The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the end of the reporting
period. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation
is subject to interpretation. It establishes provisions where appropriate on the basis of amounts expected to be paid to the tax
authorities.

Carbon Fund Annual Report 2019
11
2.7 Goods and services tax ("GST")
The Fund is not registered for GST. The Statement of Comprehensive Income and Statement of Cash Flows have been prepared so
that all components are stated inclusive of GST. All items in the Statement of Financial Position are stated inclusive of GST.
3. Critical accounting estimates and judgements
The Fund makes estimates and assumptions that affect the reported amounts of assets and liabilities within the next financial year.
Estimates of the carrying value of financial assets and financial liabilities are regularly evaluated and based on historical experience
and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Refer to notes
2.1(c) and 5.3 for further information on fair value estimation. For the Fund's financial instruments, quoted market prices are readily
available.
4. Commitments and contingent liabilities
There are no material commitments or material contingencies as at 31 March 2019.
5. Financial risk management
5.1 Financial risk factors
The Fund's activities expose it to a variety of financial risks: market risk (including currency risk, cash flow interest rate risk and price
risk), credit risk and liquidity risk, arising from the financial instruments it holds. The Fund's overall risk management programme
seeks to maximise the returns derived for the level of risk to which the Fund is exposed and seeks to minimise potential adverse
effects on the Fund's financial performance.
All security investments present a risk loss of capital. The Fund holds only long NZ Carbon Credits where the maximum loss of capital
is limited to the fair value of those positions.
The Fund uses different methods to measure and manage the various types of risk to which it is exposed; these methods are
explained below.
5.1.1 Market risk
(a) Price risk
The Fund is exposed to security price risk. This arises from investments held by the Fund for which prices in the future are uncertain.
The table below summarises the sensitivity of the Fund's net assets attributable to Unitholders to NZ Carbon Credit price movements,
including the effect of movements in foreign currency exchange rates on security prices, as at 31 March. If the prices of NZ Carbon
Credits in which the Fund invest in at the period end had increased or decreased by 5% with all other variables held constant, this
would have had the following impact on the Statement of Comprehensive Income and Net Assets attributable to Unitholders:
$
As at 31 March
Salt Carbon Fund
2019
5% increase in NZ Carbon Credit prices 77,280
5% decrease in NZ Carbon Credit prices(77,280)
(b) Foreign exchange risk

The Fund may hold both monetary and non-monetary assets denominated in currencies other than New Zealand dollars, the
functional currency. Foreign currency risk, as defined in NZ IFRS 7 Financial Instruments: Disclosures , arises as the value of future
transactions, recognised monetary assets and monetary liabilities denominated in currencies other than the functional currency
fluctuate due to changes in foreign exchange rates. NZ IFRS 7 considers the foreign exchange exposure relating to non-monetary
assets and liabilities to be a component of market price risk not foreign currency risk. However, management monitors the exposure
on all foreign currency denominated assets and liabilities.
At 31 March 2019, the Fund has no foreign currency exposures.
(c) Cash flow and fair value interest rate risk
Interest rate risk arises from the effects of fluctuations in the prevailing levels of markets interest rates on the fair value of financial
assets and liabilities and future cash flow. The Fund may hold cash and cash equivalents that expose the Fund to cash flow interest
rate risk. The interest rate risk arising from these investments is managed by the Manager.
The table below summarises the sensitivity of the Fund's net assets attributable to Unitholders to interest rate movements. The
analysis is based on an interest rate movement of 1% which represents managements best estimate of a reasonable shift in

Carbon Fund Annual Report 2019
12
interest rates having regard to historical volatility. If the interest rates at 31 March had increased or decreased by 1%, with all other
variables held constant, this would have increased/decreased comprehensive income and net assets attributable to Unitholders by
approximately:
$
As at 31 March
Salt Carbon Fund
2019
Increase of 1%98
Decrease of 1%(98)
5.1.2 Credit risk
Credit risk is the potential risk of financial loss resulting from the failure of counterparties to honour fully the terms and conditions
of a contract with the Fund. The Fund is primarily exposed to credit risk through its investment activities. All transactions in NZ
Carbon Credits are settled/paid for upon delivery using approved brokers. The risk of default is considered minimal, as delivery of NZ
Carbon Credits sold is only made once the broker has received payment. Payment is made on purchase once the securities have been
received by the broker. The trade will fail if either party fails to meet its obligations. The maximum credit risk of financial instruments
is considered to be the carrying value. The investment strategy incorporates an appropriate diversification of investments and ensures
that the Fund has no significant concentration of credit risk.
The Fund's cash holdings are invested with Westpac which is rated as AA- by Standard & Poors.
The Fund measures credit risk and expected credit losses using probability of default, exposure at default and loss given default.
Management consider both historical analysis and forward looking information in determining any credit loss. Management consider
the probability of default to be close to zero as the instruments have a low risk of default. As a result, no loss allowance has been
recognised, as any such impairment would be wholly insignificant to the Fund.
5.1.3 Liquidity risk
Liquidity risk is the risk that the Fund may not be able to generate sufficient cash resources to settle its obligations in full as they fall
due or can only do so on terms that are materially disadvantageous.
Liquidity management is designed to ensure that the Fund has the ability to generate sufficient cash in a timely manner to meet
their financial commitments and normal level of redemptions. The Fund has a benchmark liquidity level which is monitored and
maintained given normal investment conditions. Liquidity risk is managed by investing their assets in NZ Carbon Credits that are
traded in an active market and can be readily disposed to enable them to meet liabilities as they fall due.
Other payables and outstanding settlements are due for settlement within one month of the end of the reporting period. The table
below shows the net undiscounted contracted cash outflows for the Fund's financial liabilities held at fair value through profit or loss:
$
As at 31 March
Salt Carbon Fund
2019
Related party payables
7 days to 1 month
1,157
Total financial liabilities 1,157
5.2 Capital risk management
The Fund's capital is represented by Net assets attributable to Unitholders. The Fund's objectives when managing capital are to
provide returns for Unitholders through both capital growth and income. Investment decisions are guided by the mandate included in
the product disclosure statement and statement of investment policies and objectives. The Fund strives to invest the subscriptions of
Unitholder funds in investments that meet the Fund's objectives.
The Fund has a minimum initial investment of $5,000. Thereafter the investor may invest in $1,000 increments. The Fund will quote
the units on the NZX Main Board, thus units can be sold through NZX Participants (such as a broker) or financial adviser. Investments
in the Fund are generally not redeemable for cash. The Manager may vary minimum amounts from time to time at its discretion.
5.3 Fair value estimation
The fair value of financial assets and liabilities traded in active markets are based on quoted market prices at the end of the reporting
period. A financial instrument is regarded as quoted in an active market if quoted prices are readily and regularly available from an
exchange, dealer, broker or pricing service, and those prices represent actual and regularly occurring market transactions on an arm's
length basis. The fair value of financial assets and liabilities that are not traded in an active market is determined by using valuation
techniques. The Fund uses a variety of methods and makes assumptions that are based on market conditions existing at each
reporting date.

Carbon Fund Annual Report 2019
13
For instruments for which there is no active market, the Fund may use internally developed models, which are usually based on
valuation methods and techniques generally recognised as standard within the industry. Valuation models are used primarily to value
unlisted securities, debt securities and other debt instruments for which markets were or have been inactive during the period. Some
of the inputs to these models may not be market observable and are therefore estimated based on assumptions.
NZ IFRS 13 Fair Value Measurement requires the Fund to classify fair value measurements using a fair value hierarchy that reflects the
significance of the inputs used in making the measurements. The fair value hierarchy has the following levels:
*Quoted prices (unadjusted) in active markets for identical assets or liabilities (level 1).
*Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (that is, as prices)
or indirectly (that is, derived from prices) (level 2).
*Inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs) (level 3).
The level in the fair value hierarchy within which the fair value measurement is categorised in its entirety is determined on the basis
of the lowest input that is significant to the fair value measurement in its entirety. For this purpose, the significance of an input is
assessed against the fair value measurement in its entirety. If a fair value measurement uses observable inputs that require significant
adjustment based on unobservable inputs, that measurement is a level 3 measurement.
The determination of what constitutes 'observable' requires significant judgement by the Manager. The Manager considers
observable data to be that market data that is readily available, regularly distributed or updated, reliable and verifiable and provided
by independent sources that are actively involved in the relevant market.
The following table analyses within the fair value hierarchy the Fund's financial assets and financial liabilities (by class) measured at
fair value at period end:
$
As at 31 March
Salt Carbon Fund
2019
Level 1 Assets
Financial assets at fair value through profit or loss
NZ Carbon Credits
1,545,591
Total Level 1 Assets 1,545,591
Total financial assets at fair value through profit or loss 1,545,591
The valuation of all of the Fund's holdings of NZ Carbon Credits are based on quoted market prices in active markets, and
therefore classified within level 1. The Fund does not adjust the quoted price for these instruments
There were no transfers between levels during the period.
6. Taxation
$
As at 31 March
Salt Carbon Fund
2019
Tax expense comprises:
Current tax expense/(benefit)
7,760
Deferred tax expense/(benefit)
-
7,760
Total tax expense
The prima facie income tax expense on profit before tax reconciles to the income tax expense in the Financial Statements as follows:
$
As at 31 March
Salt Carbon Fund
2019
Profit before tax
27,716

Income tax using the statutory income tax rate 28% 7,760
Income tax expense as per Statement of Comprehensive Income 7,760

Carbon Fund Annual Report 2019
14
7. Earnings per unit
The basic earnings per units (EPU) is calculated by dividing net profit/(loss) after tax attributed to the unitholders by the weighted
average number of units on issue during the year.
The Fund's diluted EPU is the same as the basic EPU since the Fund has not issued any instrument with dilutive potential.
$
As at 31 March
Salt Carbon Fund
2019
Profit after tax
19,956
Weighted average number of units
1,361,964
Basic and diluted earnings per unit (cents per unit) 1.47
8. Financial assets at fair value through profit or loss
$
As at 31 March
Salt Carbon Fund
2019
Measured at fair value through profit or loss
NZ Carbon Credits
1,545,591
Total measured at fair value through profit or loss 1,545,591
Total financial assets at fair value through profit or loss 1,545,591
9. Financial instruments by category
$
As at 31 March
Salt Carbon Fund
2019
Financial assets at fair value through profit or loss
Financial assets at fair value through profit or loss
1,545,591
Total financial assets at fair value through profit or loss 1,545,591
Financial assets at amortised cost
Cash and cash equivalents
9,782
Total financial assets at amortised cost 9,782
Total financial assets 1,555,373
Financial liabilities at amortised cost
Related party payables 1,157
Total financial liabilities at amortised cost 1,157
Total financial liabilities 1,157

Carbon Fund Annual Report 2019
15
10. Related parties
10.1 General
Parties are considered to be related if one party has the ability to control the other party or exercise significant influence over the
other party in making financial or operational decisions.
Salt Investment Funds Limited is the Manager of the Fund. The Supervisor of the Fund is The New Zealand Guardian Trust Company
Limited, who is also the Custodian of the Fund. Salt Funds Management Limited is the parent entity of the Manager.
10.2 Related party fees
The Fund has transacted with related parties during the period as follows:
$
For the period ended 31 March
Salt Carbon Fund
2019
Salt Investment Funds LimitedManagement fees 5,076
5,076
The Fund owed the following amounts to related parties at balance date:
$
As at 31 March
Salt Carbon Fund
2019
Salt Investment Funds LimitedManagement fees 1,157
1,157
Under the Trust Deed the management fees payable to Salt Investment Funds Limited are payable monthly in arrears. All balances are
unsecured, settled in cash and do not attract interest.
The management fee is deducted from, and reflected in, the value of the Fund. It is calculated and accrued daily as a percentage (31
March 2019: 0.95%) of the daily gross asset value of the Fund (which essentially means its net assets but excluding any accruals for
fees and expenses).

The Manager of the Fund has agreed to pay all other fees from the management fees. This includes supervisor fees, custodian fees,
audit fees, NZ listing fees and other shareholder costs. This decision will be reviewed on an annual basis. The supervisor fees paid
for the current period were $306. The audit fees paid for the current period were $10,000. These amounts are not reflected in the
Statements of Comprehensive Income.
10.3 Investments by related parties
Salt Funds Management Limited has an investment in the Fund. As at 31 March 2019, this was 17,019 units (1.11% of the Fund).
11. Reconciliation of operating (loss)/profit to net cash outflow from operating activities
$
As at 31 March
Salt Carbon Fund
2019
Total comprehensive income attributable to Unitholders
19,956
Adjustments for non-cash items
Unrealised (gains)/losses on financial assets at fair value through profit or loss
(32,231)
Movements in working capital items
Net change in cost of investments
(1,513,360)
Decrease/(Increase) in trade and other receivables
7,760
Increase/(decrease) in trade and other payables
1,157
(1,536,674)
Net cash (outflow)/inflow from operating activities 1,516,718

Carbon Fund Annual Report 2019
16
12. Net tangible assets per unit
The Fund's net tangible assets per unit is calculated by dividing the net assets attributable to unitholders by the units on issue at the
end of the period.
$
For the period ended 31 March
Salt Carbon Fund
2019
Net tangible assets per unit 1.0125
13. Events occurring after the balance sheet date
There have been no events subsequent to balance date that require adjustment to, or disclosure of, in these Financial Statements.

Carbon Fund Annual Report 2019
17
Independent auditor’s report
To the unitholders of Salt Carbon Fund
We have audited the Fund’s financial statements which comprise:
• the statement of financial position as at 31 March 2019;
• the statement of comprehensive income for the period then ended;
• the statement of change in net assets attributable to unitholders for the period then ended;
• the statement of cash flows for the period then ended; and
• the notes to the financial statements, which include a summary of significant accounting policies.
Our opinion
In our opinion, the Fund’s financial statements present fairly, in all material respects, the financial position of the Fund as at 31
March 2019, its financial performance and its cash flows for the period then ended in accordance with New Zealand Equivalents to
International Financial Reporting Standards (NZ IFRS) and International Financial Reporting Standards (IFRS).

Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (New Zealand) (ISAs (NZ)) and International
Standards on Auditing (ISAs). Our responsibilities under those standards are further described in the Auditor’s responsibilities for the
audit of the financial statements section of our report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
We are independent of the Fund in accordance with Professional and Ethical Standard 1 (Revised) Code of Ethics for Assurance
Practitioners (PES 1) issued by the New Zealand Auditing and Assurance Standards Board and the International Ethics Standards Board
for Accountants’ Code of Ethics for Professional Accountants (IESBA Code), and we have fulfilled our other ethical responsibilities in
accordance with these requirements.
We have provided the following services to the Fund’s Manager (Salt Investment Funds Limited): controls assurance reporting and
agreed upon procedures on the net tangible assets calculation. These services have not impaired our independence as auditor of the
Fund.

Our audit approach
Overview
An audit is designed to obtain reasonable assurance whether the financial statements
are free from material misstatement. We determine materiality for each Fund
separately.
Our materiality for the Fund is calculated based on 1% of the net assets for the Fund.
We chose net assets as the benchmark because, in our view, the objective of the Fund
is to provide unitholders with a positive return on assets, taking account of both capital
and income returns.
Because of the significance of the investments to the financial statements, we have
determined there is one key audit matter: valuation and existence of financial assets at
fair value through profit or loss.
PricewaterhouseCoopers, 188 Quay Street, Private Bag 92162, Auckland 1142, New Zealand
T: +64 9 355 8000, F: +64 9 355 8001, pwc.co.nz

Carbon Fund Annual Report 2019
18
Materiality
The scope of our audit was influenced by our application of materiality.
Based on our professional judgement, we determined certain quantitative thresholds for materiality, including the overall materiality
for the Fund’s financial statements as a whole as set out above. These, together with qualitative considerations, helped us to
determine the scope of our audit, the nature, timing and extent of our audit procedures and to evaluate the effect of misstatements,
both individually and in aggregate on the Fund’s financial statements as a whole.
Audit scope
We designed our audit by assessing the risks of material misstatement in the financial statements and our application of materiality.
As in all of our audits, we also addressed the risk of management override of internal controls including among other matters,
consideration of whether there was evidence of bias that represented a risk of material misstatement due to fraud.
We tailored the scope of our audit in order to perform sufficient work to enable us to provide an opinion on the Fund’s financial
statements as a whole, taking into account the structure of the Fund, the types of investments held by the Fund, the accounting
processes and controls, the use of third party service providers and the industry in which the Fund operates.
The Manager is responsible for the governance and control activities of the Fund. The Manager has appointed The New Zealand
Guardian Trust Company Limited (acting through its nominee company Salt Investment Nominees Limited) (the Custodian) to act as
the Custodian of the Fund’s investments. The Custodian uses a Sub-Custodian, National Australia Bank Limited. The Manager has
outsourced investment accounting services to MMC Limited (the Administrator) and registry services to Link Market Services Limited
(the Registrar).
In establishing our overall audit approach, we assessed the risk of material misstatement, taking into account the nature, likelihood
and potential magnitude of any misstatement. As part of our risk assessment, we considered the control environment in place at the
Manager, the Administrator, the Custodian and the Sub-Custodian.

Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the Fund’s financial
statements of the current period. We have one key audit matter, which is valuation and existence of financial assets at fair value
through profit or loss. This matter was addressed in the context of our audit of the Fund’s financial statements as a whole, and in
forming our opinion thereon, and we do not provide a separate opinion on this matter.
Key audit matterHow our audit addressed the key audit matter
Valuation and existence of financial assets at fair value through
profit or loss (financial assets)
We assessed the processes employed by the Manager,
for recording and valuing the financial assets at fair value
through profit or loss including the relevant controls
operated by third party service organisations. The third
party service organisations include the Administrator,
Custodian and Sub-Custodian.
As disclosed in note 8 of the financial statements, the Fund’s financial
assets at fair value through profit or loss at $1,545,591 represent the
majority of the assets held by the Fund as at 31 March 2019.
The fair value of the financial assets traded in active markets are
based on quoted market prices at 29 March 2019, the last trading
day before period end and categorised as level 1 in the fair value
hierarchy.
Our assessment of the business processes included
obtaining the internal control reports over custody and
investment accounting provided by the third party service
organisations. We evaluated the evidence provided by the
internal controls reports over the design and operating
effectiveness of the key controls operated by the third party
service providers for the period to 31 March 2019.
The Fund has no level 2 and level 3 investments. Where the report did not cover the full period to 31 March
2019, we obtained a bridging letter confirming there were
no material changes in the third party service provider’s
control environment and no significant deficiencies in the
design or operation of relevant internal controls in the
intervening period.

Carbon Fund Annual Report 2019
19
Key audit matterHow our audit addressed the key audit matter
All financial assets are held by the Custodian on behalf of the Fund.Valuation
For the financial assets where quoted market prices in an
active market where available, we have agreed the market
price at 29 March 2019 to independent third party pricing
sources.
Existence
We obtained confirmation from the Custodian of the
holdings of financial assets held at fair value through profit
or loss held by the Fund as at balance date.
From the procedures performed, we have no matters to
report.


Information other than the financial statements and auditor’s report
The Manager is responsible for the annual report.
Our opinion on the financial statements does not cover the other information included in the annual report and we do not and
will not express any form of assurance conclusion on other information. At the time of our audit, there was no other information
available to us.
In connection with our audit of the financial statements, if other information is included in the annual report, our responsibility is
to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial
statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated. If, based on the work we have
performed on the other information that we obtained prior to the date of our auditor’s report, we conclude that there is a material
misstatement of this other information, we are required to report that fact.

Responsibilities of the Manager for the financial statements
The Manager is responsible for the preparation and fair presentation of the financial statements in accordance with NZ IFRS and IFRS,
and for such internal control as the Manager determines is necessary to enable the preparation of financial statements that are free
from material misstatement, whether due to fraud or error.
In preparing the financial statements, the Manager is responsible for assessing the Fund’s ability to continue as a going concern,
disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Manager either
intends to liquidate the Fund or to cease operations, or has no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements, as a whole, are free from material
misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a
high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (NZ) and ISAs will always detect a
material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in
the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial
statements.
A further description of our responsibilities for the audit of the financial statements is located at the External Reporting Board’s
website at:
https://www.xrb.govt.nz/assurance-standards/auditors-responsibilities/audit-report-2/
This description forms part of our auditor’s report.

Carbon Fund Annual Report 2019
20
Who we report to
This report is made solely to the Fund’s unitholders, as a body. Our audit work has been undertaken so that we might state those
matters which we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by
law, we do not accept or assume responsibility to anyone other than the Fund’s unitholders, as a body, for our audit work, for this
report or for the opinions we have formed.

The engagement partner on the audit resulting in this independent auditor’s report is Samuel Shuttleworth.
For and on behalf of:

Chartered Accountants Auckland
20 June 2019

Salt Listed Funds Product Disclosure Statement