Alternative Investment Trust Alternative Investment Trust ARSN 112 129 218

Climate Impact & Sustainability Data (2020, 2023)

COVID-19 caused unprecedented disruption to populations, businesses and general economic activity, impacting investment funds and their trustees and managers.

The Investment Manager monitored the valuation of the Fund’s assets and liquidity, maintaining close contact with service providers to assess ongoing operations and the basis of reported values and estimates.

Inherent difficulty of fairly valuing the portfolio assets in current market conditions.
Liquidity risk: The Trust is mainly invested in securities which lack an established secondary trading market or are otherwise considered illiquid.
Third party manager risk: The Trust primarily invests in absolute return funds managed by third parties.
Regulatory risk: the Trust operates in a complicated regulatory environment being listed on the ASX and regulated by ASIC.

The Investment Manager liaises with the underlying managers and administrators of the investee funds to obtain valuations that are as up to date and as accurate as possible.
The Board, in conjunction with the Investment Manager, may take provisions to adjust the carrying fair value of investments where warranted due to outdated valuations, incomplete, biased or unreliable valuation process, concerns over the third parties involved in the process, external factors (market, geographic, FX, political risk exposures) that are not yet captured in NAVs (particularly with a lag in NAVs).
The Responsible Entity and Investment Manager closely monitor the liquidity situation of the Trust, to allow the Trust to meet capital calls as needed, as well as potential buy-back activity and the semi-annual distribution policy.
In a temporary shortfall scenario, the Trust has in place several options to bridge any such temporary gap.
The Trust seeks to minimise this risk by investing in groups that it believes to be reputable or price the heightened risk by paying significant discounts in the secondary market.
The Responsible Entity and the Investment Manager monitor compliance with regulations by regular review of internal control reports and undergoing an annual Compliance Plan Audit.