Question 6 Sparrow Holdings is a SEBI Registered Mutual Fund which made its maiden N.F.O (New Fund Offer) on 10 April, 2010 10 face value per unit. Subscription was received for 90 lakhs units. An underwriting arrangement was also entered into with Affinity Capital Markets Ltd that agreed to underwrite the entire NFO of 100 lakh units on a commission of 1.5%. Out of the monies received 7892.50 lakhs was invested in various capital market instruments. The marketing expenses for the N.F.O amounted to 2 11.25 fakhs. During the financial year ended March 2011 the Fund sold securities having cost of 127.25 lakh (FV 754.36 lakhs) for 141.25 lakhs. The fund in tur purchased securities for 130 lakhs. The management expenses of the fund are regulated by SEBI stipulations which state that the same shall not exceed 0.25% of the average funds invested during the year. The actual amount spent towards management expenses was 72.47 lakhs of which ? 47,000 was in arrear. The dividends earned on the investments held amounted to 2.51 lakhs of which a sum of +25,000 is yet to be collected. The fund distributed 80% of realized earnings. The closing market value of the portfolio wes ? 1120.23 lakhs You are required to determine the closing per unit NAV of the fund. (8 Marks, November, 2011) Question 6 Sparrow Holdings is a SEBI Registered Mutual Fund which made its maiden N.F.O (New Fund Offer) on 10 April, 2010 10 face value per unit. Subscription was received for 90 lakhs units. An underwriting arrangement was also entered into with Affinity Capital Markets Ltd that agreed to underwrite the entire NFO of 100 lakh units on a commission of 1.5%. Out of the monies received 7892.50 lakhs was invested in various capital market instruments. The marketing expenses for the N.F.O amounted to 2 11.25 fakhs. During the financial year ended March 2011 the Fund sold securities having cost of 127.25 lakh (FV 754.36 lakhs) for 141.25 lakhs. The fund in tur purchased securities for 130 lakhs. The management expenses of the fund are regulated by SEBI stipulations which state that the same shall not exceed 0.25% of the average funds invested during the year. The actual amount spent towards management expenses was 72.47 lakhs of which ? 47,000 was in arrear. The dividends earned on the investments held amounted to 2.51 lakhs of which a sum of +25,000 is yet to be collected. The fund distributed 80% of realized earnings. The closing market value of the portfolio wes ? 1120.23 lakhs You are required to determine the closing per unit NAV of the fund. (8 Marks, November, 2011)