CAPVEST Income Corp. Releases First Quarter 2005 Results.TORONTO Toronto (tərŏn`tō), city (1998 est pop. 2,400,000), provincial capital, S Ont., Canada, on Lake Ontario. Toronto is the largest city in Canada and since the 1970s has been one of the fastest-changing cities in North America, experiencing -- Sentry Select Capital Corp. is pleased to announce the results of CAPVEST Income Corp (TSX TSX Toronto Stock Exchange (TSE before April, 2002) TSX Transfer from Stack Pointer to Index TSX True Space Extension VENTURE:CVS (1) (Concurrent Versions System) A version control system for Unix that was initially developed as a series of shell scripts in the mid-1980s. CVS maintains the changes between one source code version and another and stores all the changes in one file. ) for the three months ended March 31, 2005. Highlights - The net assets Net assets The difference between total assets on the one hand and current liabilities and noncapitalized long-term liabilities on the other hand. net assets See owners' equity. of CAPVEST Income Corp. were $4,119,752 on March 31, 2005, a slight increase from $4,092,172 at December December: see month. 31, 2004. - CAPVEST Income Corp. begin trading on the TSX Venture Exchange TSX Venture Exchange Originally called the Canadian Venture Exchange (CDNX), this was a result of the merger of the Vancouver and Alberta stock exchanges. The goal of TSX Venture Exchange is to provide venture companies with effective access to capital while protecting investors. (Symbol: CVS) January January: see month. 6th, 2005. - CAPVEST Income Corp. was fully invested in a broad portfolio of income and royalty trusts royalty trust An ownership interest in certain assets, generally crude oil or gas production and real estate. Unlike the usual corporate organization, a trust arrangement permits income and tax benefits to flow through to the individual owners. by March 31, 2005; 43 per cent in oil and gas, 28 per cent in resource-based, and 7 per cent in oil and gas equities expected to convert their operations to trusts in the months ahead. Report to Shareholders Introduction CAPVEST Income Corp. (the "Company") was formed on January 1, 2005, through the merger of two companies, Entech Investments Inc., and Biotech bi·o·tech n. Informal Biotechnology. biotech Noun short for biotechnology Noun 1. Medical Sciences Inc. The first quarter of 2005 represents the first period of operation of CAPVEST Income Corp. These financial statements cover the company's operations in that period, particularly as it relates to its investment portfolio. The financial statements contain comparative figures for the first quarter of 2004. These comparative figures are the cumulative financial statements of three mutual funds, Sentry Select Focused Technologies Fund, Sentry Select Focused Alternative Energy Fund and Sentry Select Focused Biotechnology biotechnology, the use of biological processes, as through the exploitation and manipulation of living organisms or biological systems, in the development or manufacture of a product or in the technological solution to a problem. Fund. The assets of the former two mutual funds were acquired June June: see month. 29, 2004, as part of a series of transactions that led to the creation of Entech Investments. The assets of the latter mutual fund were acquired June 29, 2004 as part of a series of transactions that led to the creation of Biotech Medical Sciences Inc. These transactions were accounted for using reverse takeover A reverse takeover occurs when a publicly-traded smaller company acquires ownership of a larger company. It typically requires reorganization of capitalization of the acquiring company. accounting principles, and so the previous year's comparative figures are those of the acquiring entity, the mutual funds. Sentry Select Capital Corp. is the investment adviser of the Company, responsible for portfolio selections. At CAPVEST's formation, the majority of the assets of both Entech and Biotech were cash. The priority in the first quarter was to invest those assets in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with CAPVEST's objectives. By focusing on income and royalty trusts, Sentry Select expects to be able to generate attractive income with which to pay dividends to CAPVEST shareholders. Canada's trust market remains a dynamic place to invest, a segment of the marketplace where specialized spe·cial·ize v. spe·cial·ized, spe·cial·iz·ing, spe·cial·iz·es v.intr. 1. To pursue a special activity, occupation, or field of study. 2. investment expertise is necessary. Sentry Select was the first investment company to deliver the benefits of a diversified diversified (di·verˑ·s portfolio of trusts to Canadian Canadian (kənā`dēən), river, 906 mi (1,458 km) long, rising in NE New Mexico. and flowing E across N Texas and central Oklahoma into the Arkansas River in E Oklahoma. retail investors Retail Investor Individual investors who buy and sell securities for their personal account, and not for another company or organization. Notes: Retail investors buy in much smaller quantities than larger institutional investors. . Sentry Select's flagship This article is about the lead ship, store, or product of a group. For other uses, see Flagship (disambiguation). A flagship is the ship used by the commanding officer of a group of naval ships. Diversified Income Trust was introduced in 1997 and continues to deliver a steady stream of income, along with the important benefits of diversification Diversification A risk management technique that mixes a wide variety of investments within a portfolio. It is designed to minimize the impact of any one security on overall portfolio performance. Notes: Diversification is possibly the greatest way to reduce the risk. and professional management. Sentry Select's income trust management team, led by Vice-President vice president or vice-pres·i·dent n. Abbr. VP 1. An officer ranking next below a president, usually empowered to assume the president's duties under conditions such as absence, illness, or death. 2. and Senior Portfolio Manager Sandy Sandy Little Orphan Annie’s dog. [Comics: “Little Orphan Annie” in Horn, 459] See : Dogs Sandy told endless tales as she and Boss traveled. [Am. Lit. McIntyre McIntyre, or MacIntyre, is a Scottish surname derived from the Gaelic Mac an t-Saoir literally meaning "Son of the Carpenter". McIntyre is the name of several places:
CAPVEST shares trade on the TSX Venture exchange under the symbol CVS. Portfolio Commentary The primary goal of the investment management team in the first quarter was to invest the portfolio in attractive income trust investments. By March 31, 2005, the portfolio was fully invested in a number of resource-based trusts. More than 43 per cent of the portfolio is invested in oil and gas trusts, and another 7 per cent of the fund is invested in equities of oil and gas companies, which are expected to convert their operations to trusts in the months ahead. Another substantial portion of the portfolio (27.6 per cent) is invested in resource-based trusts, including Canadian Oil Sands Trust Canadian Oil Sands Trust is an open-ended investment trust that generates income from its oil sands investment in the Syncrude Joint Venture. Syncrude operates an oil sands facility and produces crude oil through the mining of oil sands from ore deposits in the Athabasca region of and Fording Canadian Coal Trust. During the quarter, strong energy prices remained a common theme in the markets. Spot oil prices eventually peaked at US$58 in March, with an increase of 34 per cent in the quarter. Natural gas prices also rose significantly, reflecting a slightly colder winter in northeast “Northeastern” redirects here. For the Boston college, see Northeastern University, Boston. Northeast or north east is the ordinal direction halfway between north and east. It is the opposite of southwest. See boxing the compass. North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. . Demand continues to grow, approaching the production limits from existing oil fields This list of oil fields includes major fields of the past and present. The list is incomplete; there are more than 40,000 oil and gas fields of all sizes in the world[1]. . It is not unusual for oil prices to weaken in the second quarter, as heating requirements decline and storage facilities such as the U.S. strategic petroleum reserves
The Strategic Petroleum Reserve are refilled. Demand usually grows again during the summer driving period. Going forward, although oil prices may decline to the US$42-$45 range, high prices are expected to persist. This range is likely sustainable because of lack of spare capacity, as well as growing demand for oil in both China and India India, officially Republic of India, republic (2005 est pop. 1,080,264,000), 1,261,810 sq mi (3,268,090 sq km), S Asia. The second most populous country in the world, it is also sometimes called Bharat, its ancient name. India's land frontier (c. . As a necessary commodity in most households, consumers will be forced to adapt to higher oil prices, which will benefit energy-based income trusts. Management's Discussion and Analysis Management's discussion and analysis (MD&A) A report from management to shareholders that accompanies the firm's financial statements in the annual report. It explains the period's financial results and enables management to discuss topics that may not be apparent in the financial Portfolio Performance CAPVEST Income Corp.'s total assets were $4,159,152 at March 31, 2005, a decrease from $4,187,172 at December 31, 2004. The largest factor in this small decline in total assets was an unrealized depreciation in net assets during the period of $105,711. This decline was the result of a downturn Downturn The transition point between a rising, expanding economy to a falling, contracting one. downturn A decline in security prices or economic activity following a period of rising or stable prices or activity. in the income trust market that affected the entire sector in March. The unrealized losses Unrealized Loss A loss that results from holding onto an asset rather than cashing it in and officially taking the loss. Notes: Let's say you own a stock that is down 50%, but you haven't sold it to realize the loss yet. This is said to be an unrealized loss. more than offset the realized gain Realized Gain A gain resulting from selling an asset at a price higher than the original purchase price. Notes: There may be tax consequences for a realized profit. of $72,864. The value of the Company's shares was $0.20 on the TSX Venture Exchange at March 31, 2005. Results from Operations The Company earned $114,452 in gross investment income in the first quarter, mostly from distributions and royalties Not to be confused with Royal family. Royalties (sometimes, running royalties) are usage-based payments made by one party (the "licensee") to another (the "licensor") for ongoing use of an asset, most typically an intellectual property (IP) right. . In the first quarter of 2004, the comparative figure was $12,781. This increase primarily reflects the portfolio choices. In 2005, the portfolio was largely invested in trusts, which pay out monthly distributions. In 2004, the mutual funds largely held common shares with a capital appreciation objective. In the first quarter of 2005, the Company realized $72,864 on the sale of investments. The comparative figure for 2004 was $57,357. There was an unrealized depreciation in the value of investments of $105,711 in the first quarter of 2005, due to a decline in trust valuations. In the first quarter of 2004, the comparative figure was an unrealized appreciation of $346,904, which was the result of strong equity market performance in that period. The Company had a net increase of $25,180 in assets from investment operations in the quarter, compared to a gain of $378,280 in 2004. Management Fees The Company's largest expense in the quarter is management and investment advisory fees of $16,660. This compares to an expense of $38,762 in the first quarter of 2004. Also, in 2004, a total of $66,250 in expenses were absorbed Absorbed 1. In a general business sense, when a cost is treated as an expense instead of being passed on to the customer in the form of higher prices. 2. In underwriting, when an issue has been completely sold to the public. 3. by the Manager. Fund Administration and Trustee A user or group of users that has been given access rights to files on a network server. See also TRUSTe. Fees Fund administration and trustee fees declined to $7,238 in the first quarter of 2005 from $56,533 in the first quarter of 2004. The Company now pays a set fee structure, based on the size of the Company's net asset base. In prior years, the Years, The the seven decades of Eleanor Pargiter’s life. [Br. Lit.: Benét, 1109] See : Time fees were charged on a fixed fee basis. This has resulted in lower fees for the Company. Forward-Looking Statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. This disclosure includes statements about expected future events and/or and/or conj. Used to indicate that either or both of the items connected by it are involved. Usage Note: And/or is widely used in legal and business writing. financial results that are forward-looking for·ward-look·ing adj. Concerned with or making provision for the future: forward-looking educators; a forward-looking corporate plan. Adj. 1. in nature and subject to substantial risks and uncertainties. For those statements, CAPVEST Income Corp. cautions that actual performance will be affected by a number of factors, many of which are beyond its control. These include general economic conditions in Canada and the United States The United States and Canada share a unique legal relationship. U.S. law looks northward with a mixture of optimism and cooperation, viewing Canada as an integral part of U.S. economic and environmental policy. ; industry conditions including changes in laws and regulations; changes in income tax regulations; increased competition; and fluctuations in commodity prices, foreign exchange and interest rates. In addition, there are numerous risks and uncertainties associated with oil and natural gas operations and the evaluation of oil and natural gas reserves, as well as those of other commodity based operations. As a result, future events and results may vary substantially from what CAPVEST Income Corp. currently foresees.
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CAPVEST Income Corp.
Statements of Net Assets
As at As at
(unaudited) March 31, December 31,
2005 2004
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Assets
Investments at market value $ 4,124,949 $ -
Cash and cash equivalents 121 4,187,172
Dividends and interest receivable 34,082 -
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Total Assets 4,159,152 4,187,172
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Liabilities
Administration fee payable 18,845 -
Issue costs payable 14,792 95,000
Management fee payable 5,763 -
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Total liabilities 39,400 95,000
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Shareholders' Equity
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Equity (Note 4) $ 4,094,572 $ 4,092,172
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Surplus 25,180 -
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Total shareholders' equity 4,119,752 4,092,172
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Total liabilities and shareholders'
equity $ 4,159,152 $ 4,187,172
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The accompanying notes are an integral part of these financial
statements.
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CAPVEST Income Corp.
Statements of Operations
(unaudited)
For the three For the three
months ended months ended
March 31, March 31,
2005 2004
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Investment and other income
Distributions
Royalties and dividends $ 92,798 $ 12,497
Return of capital 12,334 -
Foreign withholding tax on dividends - (1,421)
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Interest 9,320 1,705
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114,452 12,781
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Expenses
Management and investment advisory fees 16,660 38,762
Legal, listing and filing fees 9,279 -
Audit fees 7,722 8,799
Fund administration and Trustee fees 7,238 56,533
Securityholder reporting 3,192 918
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Total Expenses 44,091 105,012
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Less:
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Expenses absorbed by Manager - (66,250)
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Net expenses 44,091 38,762
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Net investment income (loss) 70,361 (25,981)
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Realized and unrealized gain (loss)
on investments and other net assets
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Net realized gain (loss) on sale of
investments 72,864 57,357
Return of capital (12,334) -
Change in unrealized appreciation
(depreciation) of investments (105,711) 346,904
(45,181) 404,261
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Net income from investment
operations for the period $ 25,180 $ 378,280
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Income per unit $ 0.00 $ 0.02
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The accompanying notes are an integral part of these financial
statements.
CAPVEST Income Corp.
Statements of Net Realized Gain on Sale of Investments
(unaudited)
For the three For the three
months ended months ended
March 31, March 31,
2005 2004
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Proceeds from sale of investments $ 2,528,080 $ 877,933
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Cost of investments, beginning of
period - 6,118,594
Return of capital (12,334) -
Purchases during the period 6,698,210 -
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6,685,876 6,118,594
Cost of investments, end of period 4,230,660 5,298,018
Cost of investments sold, during
the period 2,455,216 820,576
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Net realized gain on sale of
investments $ 72,864 $ 57,357
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The accompanying notes are an integral part of these financial
statements.
CAPVEST Income Corp.
Statements of Shareholders' Equity
(unaudited)
For the three For the three
months ended months ended
March 31, March 31,
2005 2004
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Shareholders' equity, beginning of
period $ 4,092,172 $ 6,252,104
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Issuance of equity shares 2,400 889,236
Redemptions - (3,042,247)
Net income from investment
operations for the period 25,180 378,280
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Shareholders' equity, end of period $ 4,119,752 $ 4,477,373
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The accompanying notes are an integral part of these financial
statements.
CAPVEST Income Corp.
Statements of Cash Flow
(unaudited)
For the three For the three
months ended months ended
March 31, March 31,
2005 2004
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Operating activities
Net income from investment operations
for the period $ 25,180 $ 378,280
Items not affecting cash/other:
Net realized gain on sale of
investments (72,864) (57,357)
Change in unrealized (appreciation)
depreciation of investments 105,711 (346,904)
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58,027 (25,981)
Change in working capital
Change in other assets and liabilities (89,682) 1,396,943
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Cash flows from (used in) operating
activities (31,655) 1,370,962
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Financing activities
Net proceeds from issuance (redemption)
of Equity Shares 2,400 (2,153,011)
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Cash flows from (used in) financing
activities 2,400 (2,153,011)
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Investing activities
Sales of investments 2,528,080 877,933
Return of capital 12,334 -
Purchase of investments (6,698,210) -
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Cash flow from (used in) investing
activities (4,157,796) 877,933
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Net increase in cash during the
period (4,187,051) 95,884
Cash and cash equivalents, beginning
of period 4,187,172 520,202
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Cash and cash equivalents, end of
period $ 121 $ 616,086
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The accompanying notes are an integral part of these financial
statements.
CAPVEST Income Corp.
Statement of Investment Portfolio
(unaudited)
As at March 31, 2005
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Units Average Market % of Net
Investments Held Cost Value Assets
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Income Funds
Energy
Acclaim Energy Trust
9,500 $145,075 $144,495 3.51
ARC Energy Trust
10,600 197,137 192,390 4.67
Bonavista Energy Trust
7,000 206,148 210,910 5.12
Crescent Point Energy Trust
8,100 147,836 162,000 3.93
Esprit Energy Trust Cl. B
14,400 188,841 179,280 4.35
Focus Energy Trust
7,800 171,841 162,240 3.94
Ketch Resources Trust
11,700 172,763 154,440 3.75
Vermilion Energy Trust
7,800 173,004 177,294 4.30
Viking Energy Royalty Trust
30,000 212,928 211,200 5.13
Zargon Energy Trust
7,400 193,102 181,670 4.41
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1,808,675 1,775,919 43.11
Resources
Canadian Oil Sands Trust 2,700 202,623 222,075 5.39
Fording Canadian Coal Trust 1,900 221,760 210,653 5.11
Labrador Iron Ore Royalty Income
Fund 6,400 170,112 147,264 3.57
Units Average Market % of Net
Held Cost Value Assets
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Noranda Income Fund Cl. A 13,500 174,566 159,705 3.88
PRT Forest Regeneration Income
Fund 12,700 $130,231 $120,015 2.91
SFK Pulp Fund 17,400 128,324 117,624 2.86
TimberWest Forest Corp. 10,700 171,521 158,146 3.84
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1,199,137 1,135,482 27.56
Utilities & Infrastructure
Inter Pipeline Fund Cl. A 13,900 129,436 123,293 2.99
Keyera Facilities Income
Fund 12,900 194,650 192,855 4.68
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324,086 316,148 7.67
Consumer
Rogers Sugar Income Fund 36,700 174,304 164,416 3.99
Industrials
CCS Income Trust 8,800 207,377 244,728 5.94
Great Lakes Carbon Income Fund 17,000 217,290 194,650 4.73
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424,667 439,378 10.67
Equities Shares Held
Energy
Canadian Natural
Resources Ltd. 1,600 $108,864 $109,376 2.66
Penn West Petroleum Ltd. 2,300 190,927 184,230 4.47
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299,791 293,606 7.13
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Total portfolio of investments $4,230,660 $4,124,949 100.13
Liabilities, net of cash and
other assets (5,197) (0.13)
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Total net assets $4,119,752 100.00
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Note: Percentage of net assets shown relates to investments at market
value to total net assets of the Fund.
The accompanying notes are an integral part of these financial
statements.
CAPVEST Income Corp.
Notes to Financial Statements
March 31, 2005 and 2004
(unaudited)
NOTE 1 - ORGANIZATION CAPVEST Income Corp. ("CAPVEST", or the "Company") was created through the amalgamation amalgamation /amal·ga·ma·tion/ (ah-mal´gah-ma´shun) trituration (3). amalgamation ( of Biotech Medical Sciences Inc. ("Biotech") and Entech Investments Inc. ("Entech") effective January 1, 2005. Special Meetings of Shareholders of Entech and Biotech were held on December 21, 2004 at which time all resolutions in regards to the amalgamation were passed. Sentry Select Capital Corp. ("Sentry Select") is the Investment Advisor Investment Advisor 1. A person making investment recommendations in return for a flat fee or percentage of assets managed, known as a commission. 2. For mutual fund companies, it is the individual who has the day-to-day responsibility of investing and monitoring the cash and (the "Investment Advisor") of the Company. Sentry Select had also served as the Investment Advisor of Biotech and Entech. On March 12, 2004, Sentry Select and Inter To cross over boundaries; for example, internetwork means from one network to another. Contrast with intra. Energy Corp. ("Inter Energy")announced a proposal to transfer the assets from Sentry Select Focused Technologies Fund and Sentry Select Focused Alternative Energy Fund, two mutual funds administered by Sentry Select, to Inter Energy in exchange for common shares and warrants of Inter Energy. Sentry Select had served as the manager of the mutual fund trusts. In connection with the approval of this transaction, Inter Energy's shareholders approved a change of the corporate name to Entech Investments Inc. Unitholders of the two mutual funds approved the asset transfer transaction at special meetings called for that purpose on April 30, 2004. Effective June 29, 2004, Entech acquired all of the outstanding units of the mutual funds in exchange for 15,376,562 common shares and 15,376,562 common share purchase warrants, each entitling a warrantholder to purchase one common share at a price of $0.20 per share for a 12-month period. The completion of the asset transfer transaction was accepted by the TSX Venture Exchange (the "Exchange") as a "Qualifying Transaction." Entech began trading as a regular Tier 2 issuer on the Exchange effective July July: see month. 16, 2004. On March 12, 2004, Sentry Select and Rita Capital Corp. ("Rita Capital") announced a proposal to transfer the assets from Sentry Select Focused Biotechnology Fund, a mutual fund administered by Sentry Select, to Rita Capital in exchange for common shares and warrants of the Rita Capital. Sentry Select had served as the manager of the mutual fund trust. Unitholders of Sentry Select Focused Biotechnology Fund approved the asset transfer transaction at a special meeting called for that purpose on April 30, 2004. In connection with the approval of this transaction, Rita Capital's shareholders approved a change of the corporate name to Biotech Medical Sciences Inc. Effective June 29, 2004, Biotech acquired all of the outstanding units of Sentry Select Focused Biotechnology Fund in exchange for 7,640,738 common shares and 7,640,738 common share purchase warrants, each entitling a warrantholder to purchase one common share at a price of $0.20 per share for a 12-month period. The completion of the asset transfer transaction was accepted by the TSX Venture Exchange (the "Exchange") as a "Qualifying Transaction." Biotech began trading as a regular Tier 2 issuer on the Exchange effective July 19, 2004. The directors and officers of Biotech and Entech continued as directors and officers of CAPVEST. Common shares of CAPVEST began trading on January 6, 2005 on the TSX Venture Exchange under the symbol CVS. NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICICIES The financial statements are prepared in accordance with Canadian generally accepted accounting principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting , which require management to make estimates and assumptions that affect the reported amounts of assets, liabilities, income and expenses during the reporting period. Actual results could differ from these estimates. Generally accepted accounting principles The Canadian Institute of Chartered Accountants The Canadian Institute of Chartered Accountants (CICA) is the umbrella body for the Chartered Accountant profession in Canada and Bermuda. Membership of the CICA totals 70,000 Chartered Accountants and 8,500 students. ("CICA CICA Competition In Contracting Act of 1984 (USA) CICA Canadian Institute of Chartered Accountants CICA Competition In Contracting Act CICA Criminal Injuries Compensation Authority (UK) ") issued Section 1100, "Generally Accepted Accounting Principles ("GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). ")" of the CICA Handbook
This article is about reference works. For the subnotebook computer, see .
investment assets - anything of material value or usefulness that is owned by a person or company industry are no longer considered GAAP. This section primarily impacts the disclosure of an investment fund's financial statements, and accordingly, has no impact on the valuation of a fund or in the calculation of the net asset value per unit of a fund. The Company, in conjunction conjunction, in astronomy conjunction, in astronomy, alignment of two celestial bodies as seen from the earth. Conjunction of the moon and the planets is often determined by reference to the sun. with other investment funds, continues to assess the impact of section 1100 on its financial statements. A summary of significant accounting policies used in the preparation of these financial statements is as follows: a. Valuation of Investments Investments are valued at market value, which is determined by the closing sale price on the recognized stock exchange on which the investments are listed or principally traded. If no closing price was reported, the most recent closing price, if it is between the bid and ask price, or the average of the closing bid and closing ask prices, is used. Portfolio investments for which reliable quotations are not readily available are valued at management's best estimate of fair value, as determined pursuant to procedures established by the Investment Advisor. The types of securities that are subject to such valuations are delisted securities that are valued at the lower of the last traded price of the security and the Investment Advisor's best estimate of fair value. b. Investment Transactions and Income Recognition Investment transactions are accounted for on the date following the date on which the investments are purchased or sold. Dividend income is recognized on the ex-dividend date Ex-dividend date The first day of trading when the buyer of a stock is no longer entitled to the most recently announced dividend payment ( i.e. the trade will settle the day after the record date, too late for the buyer to appear on the shareholder record and receive the dividend. and interest income is recognized daily on an accrual basis A method of accounting that reflects expenses incurred and income earned for Income Tax purposes for any one year. Taxpayers who use the accrual method must include in their taxable income any money that they have the right to receive as payment for services, once it . Realized gains or losses arising from the sale of investments, and unrealized appreciation and depreciation on investments, are calculated on an average-cost basis. Brokerage BROKERAGE, contracts. The trade or occupation of a broker; the commissions paid to a broker for his services. commissions incurred for portfolio transactions are included in the cost of portfolio investments purchased or as a reduction of the proceeds received upon the sale of portfolio investments. c. Return of capital Distributions that are treated as a return of capital for income tax purposes are separately identified within the Statements of Changes in Net Assets and Operations and are used to reduce the average cost of the underlying investments on the Statement of Investment Portfolio. d. Foreign Currency Translation The market value of foreign currency denominated investments, currency holdings and other assets other assets Assets of relatively small value. For financial reporting purposes, firms frequently combine small assets into a single category rather than listing each item separately. and liabilities denominated in a foreign currency are translated into Canadian dollars Noun 1. Canadian dollar - the basic unit of money in Canada; "the Canadian dollar has the image of loon on one side of the coin" loonie dollar - the basic monetary unit in many countries; equal to 100 cents using the prevailing rate of exchange on each valuation date. Income, expenses and investment transactions in foreign currencies are translated into Canadian dollars at the rate of exchange prevailing on the respective dates of such transactions. The portion of the results of operations arising from changes in foreign exchange rates on portfolio investments is not isolated from the fluctuations arising from changes in market prices. Such fluctuations are included in "Net realized gain (loss) on sale of investments" in the statement of operations See Income statement. . e. Cash and Cash Equivalents Cash and cash equivalents include cash and instruments with maturity of three months or less when purchased. f. Income Taxes The Company follows the liability method of accounting for income taxes. Under this method, income tax assets and liabilities are recognized for the estimated tax Federal and state tax laws require a quarterly payment of estimated taxes due from corporations, trusts, estates, non-wage employees, and wage employees with income not subject to withholding. consequences attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to differences between the amounts reported in the financial statements and their respective tax bases, using substantively sub·stan·tive adj. 1. Substantial; considerable. 2. Independent in existence or function; not subordinate. 3. Not imaginary; actual; real. 4. enacted income tax rates. The effect of a change in income tax rates on future tax assets and liabilities is recognized in income in the period that the change occurs. g. Stock-Based Compensation The Company has a stock-based compensation plan as described in Note 4. The Company follows the fair value method of accounting for the compensation expense associated with the plan, whereby an estimate of the fair value of the stock options granted is measured and recorded as compensation expense over the vesting Vesting The process by which employees accrue non-forfeitable rights over employer contributions that are made to the employee's qualified retirement plan account. Notes: period or at the date of grant if options vest immediately, with the related offset recorded as contributed surplus. The effect of actual forfeitures of a previously granted option are recognized as they occur. Any consideration paid to the Company with respect to the exercise of stock options is credited to share capital. NOTE 3 - INVESTMENT MANAGEMENT AND SERVICING FEES The Investment Advisor is responsible for the management of the Company's portfolio of investments and earns a management fee equal to 1.10 per cent per annum Per annum Yearly. on the net asset value of the Company. Prior to June 29, 2004, the Investment Advisor also paid a servicing fee to eligible dealers equal to 0.40% of the net asset value of each mutual fund trust. NOTE 4 - SHARE CAPITAL Authorized au·thor·ize tr.v. au·thor·ized, au·thor·iz·ing, au·thor·iz·es 1. To grant authority or power to. 2. To give permission for; sanction: The authorized share capital of CAPVEST consists of an unlimited number of common shares, Class A Preference shares, Class B Preference shares and Class C Preference shares. All Preference shares are issuable in series. Issued In connection with the amalgamation, each shareholder of Biotech and Entech received common shares of CAPVEST in exchange for common shares of Biotech or Entech held. The exchange ratios, determined by an independent valuator, were as follows. One (1) Entech share equals One (1) CAPVEST Income Corp share. One (1) Biotech share equals 0.88 CAPVEST Income Corp share. Upon the completion of the amalgamation, 28,680,411 CAPVEST common shares were issued. There were also 22,100,411 warrants outstanding, 15,376,562 issued through the purchase of Entech, and 6,723,849 issued through the purchase of Biotech. As at March 31, 2005 there are no Preference shares issued. Common shares outstanding: Shares Outstanding 2005 -------------------------------------------------- Beginning - Shares issued upon amalgamation 28,680,411 Warrants exercised 12,000 -------------------------------------------------- Ending 28,692,411 -------------------------------------------------- Stock Option Plan As of March 31, 2005, there were 430,000 outstanding options that are exchangeable into CAPVEST common shares. These options were originally issued in 2003 by Biotech and Entech. At that time, Biotech and Entech each issued 215,000 options. Each Biotech option entitles the holder to acquire 0.88 CAPVEST common shares at a price of $0.20 until November November: see month. 18, 2007. Each Entech option entitles the holder to acquire one (1) CAPVEST common share at a price of $0.20 until November 18, 2007. No stock option expense has been recognized as at March 31, 2005 as CAPVEST's share price was less than the exercise price of the options. Warrants In the first quarter of 2005, 12,000 warrants were exercised to purchase common shares at a price of $0.20 per share. This conversion of warrants added $2,400 to the shareholders equity in the period. NOTE 5 - COMPARATIVE FIGURES Comparative information for the period ended March 31, 2004 is that of Sentry Select Focused Technologies Fund, Sentry Select Focused Alternative Energy Fund and Sentry Select Focused Biotechnology Fund. Comparative financial information at December 31, 2004 represents the combined balance sheets of Entech and Biotech. Certain information from the prior years may have been restated to conform with the changes between reporting requirements of a mutual fund trust and those of a corporation. NOTE 6 - INCOME TAXES As at March 31, 2005 there is no provision for income taxes due to tax loss carry forwards, as detailed below. The Company has non-capital losses of approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $581,925. These losses were originally incurred by Entech. The breakdown breakdown /break·down/ (brak´doun) 1. the act or process of ceasing to function. 2. an often sudden collapse in health. 3. loss of self-control. of these losses is as follows:
Non-Capital Losses
Date Expiry Amount
2002 2009 $ 27,769
2003 2010 $ 28,088
2004 2014 $526,068
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$581,925
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The future tax asset relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc these items has not been recognized on the balance sheet due to the uncertainty of realization (specification) realization - A UML semantic relationship between a classifier that specifies a contract and another classifier that guarantees to carry it out. [Handout by Mr. David Gillibrand]. . Biotech had non-capital losses of $486,640 at December 31, 2004. These losses expired ex·pire v. ex·pired, ex·pir·ing, ex·pires v.intr. 1. To come to an end; terminate: My membership in the club has expired. 2. as of January 1, 2005 due to the amalgamation of Entech and Biotech. NOTE 7 - INVESTMENTS IN RELATED PARTIES The Company is permitted to invest in other trusts that are managed by the Manager or entities under common control as the Manager, subject to some restrictions, up to a total limit of 5 per cent. As of March 31, 2005, the Trust held 13,900 units in Inter Pipeline Fund having a market value of $123,293, which represents 2.99 per cent of the Trust's net asset value. The Exchange Tower 130 King Street West Suite 2850, P.O. Box 104 Toronto, Ontario M5X 1A4 CAPVEST Income Corp. (TSX VENTURE:CVS) |
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