United Asia Pacific Infrastructure Fundinternetfileserver.phillip.com.sg/poems/unittrust/reports/036360_ar_122011.pdfEquity markets across the region were down sharply in 2011 due

United Asia Pacific Infrastructure FundAnnual Report

for the financial year ended 31st December 2011

United Asia Pacific Infrastructure Fund(Constituted under a Trust Deed in the Republic of Singapore)

1

MANAGERUOB Asset Management LtdRegistered Address:80 Raffles PlaceUOB PlazaSingapore 048624Company Registration No. : 198600120Z

OPERATIONS ADDRESS80 Raffles Place#06-00, UOB Plaza 2Singapore 048624Tel: 1800 22 22 228

DIRECTORS OF UOB ASSET MANAGEMENTTerence Ong Sea EngYeo Eng CheongThio Boon Kiat

TRUSTEEHSBC Institutional Trust Services (Singapore) Limited21 Collyer Quay#14-01, HSBC BuildingSingapore 049320

AUDITORSPricewaterhouseCoopers LLP8 Cross Street#17-00, PWC BuildingSingapore 048424

SOLICITORS TO THE MANAGERTan Peng Chin LLC30 Raffles Place #11-00, Chevron HouseSingapore 048622

SOLICITORS TO THE TRUSTEEDrew & Napier LLC10 Collyer Quay#10-01 Ocean Financial CentreSingapore 049315


2

A) Fund Performance

Fund Performance/Benchmark Returns

3 mth

%Growth

6 mth

%Growth

1 yr

%Growth

3 yrAnn

Comp Ret

5 yrAnn

Comp Ret

10 yr Ann

Comp Ret

Since Inception

17 October 2006 Ann

Comp Ret

United Asia PacificInfrastructure Fund 2.67 -24.35 -31.18 6.18 -6.83 NA -4.96

Benchmark 1.46 2.96 5.98 6.00 6.00 NA 6.00

Source: Lipper, a Thomson Reuters Company

Note: The performance returns of the Fund are in Singapore dollars based on a NAV-to-NAV basis with net dividends reinvested. The benchmark of the Fund: The performance of the Fund will be measured against an absolute return benchmark of 6% per annum.

For the year ended 31 December 2011, the Fund fell 31.2% compared with the 6% per annum absolute return benchmark in Singapore dollar terms. For reference, the MSCI AC Asia Pacific Index declined 14.1% over the same period.

Equity markets across the region were down sharply in 2011 due to concerns over Europe’s debt crisis and fear of a full blown global economic collapse. The infrastructure sector being a cyclical sector was adversely impacted. During the year, the Fund exited from the highly cyclical portfolio holdings and added more defensive companies in the utilities and telecom sectors. The Fund also increased its cash reserves.

Fears of a hard landing in China hit commodity prices and impacted some of the Fund’s holdings in Australia and Hong Kong. The slowdown in Singapore’s property market negatively impacted the Funds investments in REITS.

Holdings that detracted from performance were Zhuzhou CSR, CST Mining, Keppel Corp and Komatsu.

Zhuzhou CSR operates in a regulated industry where technology acts as an entry barrier. The stock fell following a railway accident in China which resulted in a suspension of new orders. CST Mining operates copper mines. The company was adversely impacted due to concerns over growth. The company offers great value at the current price. Keppel Corp also underperformed. Concerns of a slowdown in new orders adversely impacted share price performance. The stock has since recovered. Komatsu’s share price declined due to concern over its excavators business in China. However, the company continues to do well outside of China.

Key contributors to performance include Evolution Mining, PT Indomobil and Smartone.

Evolution Mining operates gold mines and is well positioned to benefit from high gold prices. PT Indomobil Sukses International distributes and manufactures a number of autos and trucks in Indonesia (Nissan, Volkswagen, Audi, Hino trucks and Volvo trucks). The company saw a substantial increase in sales in 2011 and is likely to deliver continued growth in the coming years. Smartone is a Hong Kong based telecom company. The stock offers 6% dividend yield, with earnings expected to grow at more than 15% over the next 2 years.


3

As at end December 2011, the Fund had the following regional asset allocation: China (31.4%), Singapore (15.0%), India (8.3%), Hong Kong (7.3%), Australia (6.4%), South Korea (6.1%), Japan (5.5%), others (5.0%) and the remainder in cash (15.0%).

Market Review

Equity markets started the year on a fairly solid footing. However, a Standard & Poor’s downgrade of US debt and political wrangling over the US debt ceiling sparked off a market correction in August. With the global financial crisis (GFC) entering a second phase where fiscal adjustments started to be a drag on growth and debt loads in the developed world (Greece in particular) starting to impact market confidence, markets became increasingly volatile. Asian equity markets were not spared and performed poorly in 2011.

During the course of the year, exogenous shocks also compounded high levels of volatility. The combination of an earthquake and tsunami in Japan, geopolitical uncertainty in the Middle East, and a lack of a solution for Greece clouded the economic picture and led to heightened risk aversion.

A massive earthquake and tsunami struck Japan in March, resulting in catastrophic damage to Japan’s industrial infrastructure and triggered a sharp slowdown in Japan industrial output and domestic demand. This had global repercussions across the electronics and auto industry supply chains, and became yet another headwind for the global economy.

In the Middle East and parts of Africa, calls for greater freedom and political representation, referred to as the “Jasmine Revolution”, both disrupted economic activity and led to the downfall of several governments. Having started in Egypt, the movement impacted several countries in the region, including Libya, disrupting oil supplies. Perceived risk to energy security drove oil prices to beyond US$100 per barrel. This exacerbated already prevalent inflation problems in Asia.

Meanwhile, Europe continued its muddle through approach to dealing with problems in the peripheral Eurozone. This adversely influenced both the economic outlook and market sentiment. Concern mounted that Greece’s problems would spread to other peripheral countries in Europe, and credit spreads widened. Credit Default Swap (CDS) spreads tell the picture nicely, having peaked in November on hope the Eurozone is on the brink of coming up with a solution for Greece’s debt problems. This set the stage for a recovery in Asian equity markets to near their August highs.

Economic growth started to slow noticeably in Asia during 2011, but has held up well compared to the developed world. Initially, while export growth slowed, domestic demand stayed firm. However, into late 2011, even domestic demand started to falter. China in particular came into focus due to signs that the real estate sector was starting to cool sharply and indications that industrial output was softening and the purchasing managers index (PMI) dipped below 50.

A significant element of the slowdown was linked to weaker domestic demand as monetary conditions were tightened across the region to contain inflation. The combination of tighter monetary conditions and weaker external demand caused growth to slow. Against a backdrop of weaker growth, corporate earning expectations also turned down in late 2011. Central banks reversed policies in late 2012.


4

Fund Strategy and Outlook

The external environment remains uncertain however there are a number of developments that suggest the outlook could continue to improve into 2012. US data has turned up sharply and the recovery continues to look like it is broadening out. Europe is hopefully on the brink of a more durable solution to its debt / sovereign problems, and Asia and emerging markets are starting to ease monetary conditions.

The US recovery appears to be increasingly durable, with employment gains and a pick up in hours worked leading to rising income and sustained, albeit modest gains in consumption. Meanwhile there is a bit of a renaissance taking shape in the US industrial sector, where improved terms of trade and lower wages have restored competitiveness. Surprisingly, the US has become a bastion of stability in terms of growth. And the US corporate sector remains in the sweet spot of being able to benefit from both recovering domestic demand and ongoing export gains to the developing world.

The Eurozone appears to at long last be coming to grips with its twin challenge of dealing with Greece’s problems and recapitalizing and re-liquifying its banks. And while Rome wasn’t built in a day, a more proactive ECB and steadier hands at the helm across Europe are encouraging. Markets are now focusing on a plan, rather than a plan for a plan as was the case for much of 2011. It is now more a question of execution. Painful as it may be, it will be positive over the long run.

Asia is in a transition period. While the focus in 2011 was dealing with overheating, the challenge now is to continue to put in place policies aimed at stimulating domestic demand, but at the same time prevents nascent bubbles in the real estate sectors from becoming something less benign. The rebalancing process will be a fine line that policy makers will have to walk, and China best exemplifies this challenge. With prior stimulative policies having resulted in a significant overinvestment in the real estate sector, policy makers need to enable developers to work through housing and land inventories and manufacturing a soft landing for housing prices, or risk a sharp slowing in growth.

Underlying this adjustment process, there are still many positive factors supporting growth in Asia. Broadly speaking, positive demographic trends, favourable terms of trade and significant gains in literacy and skills should translate to ongoing wage and purchasing power gains over the long run. Rising purchasing power of the middle and increasingly lower income segments of emerging Asia (China, India, Indonesia, etc.) is a very supportive backdrop for investors, particularly in many of the regions’ domestically oriented sectors, retail, healthcare, telecommunications and banking.

However, just as Rome wasn’t built in a day, the journey towards development isn’t always a straight upward sloping line. Cracks in China’s development model are already very visible in its real estate and housing markets. The local government financing model of using land to repay prior debts could be challenged. The loss content in bank balance sheets could be grossly underestimated if real estate prices continue to fall. The build-up of a fixed asset investment overhang is eerily reminiscent of South East Asia’s “Tiger era” in the early 1990s. And the risk is too big to be ignored.

Our strategy for this year will be to maintain a diversified mix of high growth stocks at reasonable valuations for capital appreciation and high dividend yield stocks with stable business for downside protection. We remain completely bottom-up in our stock selection, targeting companies with proven management, competitive strengths, healthy balance sheets and strong profitability.


5

Chinese toll road company, Shenzhen Expressway is a good illustration. Its dividend yield is among the best in the sector and its valuations are the cheapest. Power Assets (Hong Kong) and NTPC (India) are additional examples. Both these companies earn regulated returns on more than 90% of their business and are hedged from coal costs going up in future.

For growth, we are invested in China Everbright International, a leading player in the Waste-To-Energy business in China. This company benefits from increasing urbanization in China and from policy support by the Chinese government. The Fund also added ENN Energy which operates City Gas Distribution business in China. This company will be one of the beneficiaries of China’s drive towards cleaner fuels.

In summary, the Fund will continue to focus on exploiting long-term investment opportunities arising from Asia’s infrastructure build-out. The Fund adopts a balanced approach to manage risks by investing a proportion of portfolio in stable companies with high dividend yields to protect the downside and by investing in high growth companies at reasonable valuations.


6

B) Investments at fair value and as a percentage of NAV as at 31 December 2011 under review classified by

Fair Value % of NAV (S$)

i) Country

Australia 3,189,185 6.43 China 15,580,262 31.39 Hong Kong 3,623,634 7.30 India 4,096,444 8.25 Indonesia 1,001,670 2.02 Japan 2,724,077 5.49 Philippines 885,616 1.78 Singapore 7,487,800 15.08 South Korea 3,043,863 6.13 Thailand 571,266 1.15

Portfolio of investments 42,203,817 85.02 Other net assets 7,433,215 14.98

Total 49,637,032 100.00

ii) Industry

Consumer Discretionary 2,450,857 4.94 Energy 5,698,127 11.48 Financials 5,246,112 10.56 Industrials 17,310,250 34.88 Materials 2,590,204 5.22 Telecommunication Services 2,591,716 5.22 Utilities 6,316,551 12.72


Total 49,637,032 100.00

iii) Asset Class

Equities 42,203,817 85.02 Other net assets 7,433,215 14.98

Total 49,637,032 100.00

iv) Credit rating of debt securities

N/A


7

C) Top Ten Holdings

The top 10 holdings as at 31 December 2011 and 31 December 2010

Percentage of total net assets attributable to 10 largest holdings at 31 December 2011 Fair Value unitholders (S$) %

KOMATSU LIMITED 2,724,077 5.49 SEMBCORP INDUSTRIES LTD 1,539,000 3.10 CHINA EVERBRIGHT INTERNATIONAL LIMITED 1,519,529 3.06 HYUNDAI ENGINEERING AND CONSTRUCTION CO LTD 1,424,289 2.87 BHP BILLITON LIMITED 1,372,662 2.77 CHINA STATE CONSTRUCTION INTL HOLDINGS LTD 1,324,664 2.67 CHAOWEI POWER HOLDINGS LTD 1,179,015 2.38 CHINA SHENHUA ENERGY COMPANY LIMITED 1,178,014 2.37 CHINA PETROLEUM & CHEM CORP (SINOPEC) 1,170,311 2.36 ZHUZHOU CSR TIMES ELECTRIC COMPANY LIMITED 1,135,274 2.29

Percentage of total net assets attributable to 10 largest holdings at 31 December 2010 Fair Value unitholders (S$) %

ZHUZHOU CSR TIMES ELECTRIC COMPANY LIMITED 6,512,654 7.07KOMATSU LIMITED 3,491,317 3.79ALLIANCE GLOBAL GROUP INC 3,029,879 3.29FIRST TRACTOR COMPANY LIMITED 2,850,934 3.10KEPPEL CORPORATION LIMITED 2,830,000 3.07SEMBCORP INDUSTRIES LTD 2,565,000 2.79CDL HOSPITALITY TRUST 2,477,280 2.69CHINA STATE CONSTRUCTION INTL HLDGS LTD 2,412,582 2.62MIDAS HOLDINGS 2,350,000 2.55GREAT WALL MOTOR COMPANY LTD 2,048,495 2.22

D) Exposure to derivatives

i) fair value of derivative contracts and as a percentage of NAV as at 31 December 2011

N/A

ii) net gains/(losses) on derivative contracts realised during the financial year ended 31 December 2011

N/A

iii) net gains/(losses) on outstanding derivative contracts marked to market as at 31 December 2011

N/A


8

E) Amount and percentage of net asset value (NAV) invested in other schemes as at 31 December 2011

Fair Value (S$) % of NAV

CAPITACOMMERCIAL TRUST 525,000 1.06CDL HOSPITALITY TRUST 618,000 1.24MAPLETREE COMMERCIAL TRUST 760,500 1.53SUNTEC REIT 537,500 1.08

F) Amount and percentage of borrowings to net asset value (NAV) as at 31 December 2011

N/A

G) Amount of redemptions and subscriptions for the financial year ended 31 December 2011

Total amount of redemptions SGD 21,824,510 Total amount of subscriptions SGD 4,471,585

H) The amount and terms of related-party transactions for the financial year ended 31 December 2011

i) As at 31 December 2011 the Fund maintained current accounts with the United Overseas Bank Limited as follows :

Bank balances SGD 82,183

ii) Purchase/holdings of UOBAM unit trusts by UOB or its affiliated companies as at 31 December 2011

N/A

iii) Investment in Initial Public Offerings managed by UOB Group.

N/A

iv) As at 31 December 2011 the brokerage income earned by UOB Kay Hian Pte Ltd was SGD 9,637.

I) Expense ratios

31 December 2011 2.05%31 December 2010 1.87%

Note : The expense ratio is computed in accordance with the IMAS guidelines on disclosure of expense ratios dated 25 May 2005. Brokerage and other transaction costs, interest expense, foreign exchange gains/losses, tax deducted at source or arising on income received and dividends paid to unitholders are not included in the expense ratio. The Fund has not paid any performance fees during the year.


9

J) Turnover ratios

31 December 2011 74.85%31 December 2010 75.70%

Note : The turnover ratio is calculated in accordance with the formula stated in the “Code on Collective Investment Schemes”.

K) Any material information that will adversely impact the valuation of the scheme such as contingent liabilities of open contracts

N/A

L) For schemes which invest more than 30% of their deposited property in another scheme, the following key information on the second-mentioned scheme (“the underlying scheme”)1 should be disclosed as well

i) top 10 holdings at fair value and as percentage of NAV as at 31 December 2011 and 31 December 2010

N/A

ii) expense ratio for the financial year ended 31 December 2011 and 31 December 2010. A footnote should state (where applicable) that the expense ratio does not include brokerage and other transaction costs, performance fee, foreign exchange gains/losses, front or back end loads arising from or arising out of income received.

N/A

iii) turnover ratios for the financial year ended 31 December 2011 and 31 December 2010

N/A

M) Soft dollar commissions/arrangements

UOB Asset Management has entered into soft dollars arrangements with selected brokers from whom products and services are received from third parties. The product and services relate essentially to computer hardware and software to the extent that they are used to support the investment decision making process, research and advisory services, economic and political analyses, portfolio analyses including performance measurements, market analyses, data and quotation services, all of which are believed to be helpful in the overall discharge of UOB Asset Management’s duties to clients. As such services generally benefit all of UOB Asset Management’s clients in terms of input into the investment decision making process, the soft credits utilised are not allocated on a specific client basis. The Manager confirms that trades were executed on the best available terms and there was no churning of trades.

1 where the underlying scheme is managed by a foreign manager which belongs to the same group of companies as, or has a formal arrangement or investment agreement with, the Singapore manager, the above information should be disclosed on the underlying scheme. In other cases, such information on the underlying scheme should be disclosed only if it is readily available to the Singapore manager.


10

REPORT OF THE TRUSTEE

The Trustee is under a duty to take into custody and to hold the assets of United Asia Pacific Infrastructure Fund (the “Fund”) in trust for the unitholders. In accordance with the Securities and Futures Act (Cap. 289), its subsidiary legislation and the Code on Collective Investment Schemes (collectively referred to as the “laws and regulations”), the Trustee shall monitor the activities of the Manager for compliance with the limitations imposed on the investment and borrowing powers as set out in the Trust Deed in each annual accounting year and report thereon to unitholders in an annual report which shall contain the matters prescribed by the laws and regulations as well as the recommendations of Statement of Recommended Accounting Practice 7 “Reporting Framework for Unit Trusts” issued by the Institute of Certified Public Accountants of Singapore and the Trust Deed.

To the best knowledge of the Trustee, the Manager has, in all material respects, managed the Fund during the financial year covered by these financial statements, set out on pages 13 to 31 comprising the Statement of Total Return, Balance Sheet, Portfolio Statement and Notes to the Financial Statements, in accordance with the limitations imposed on the investment and borrowing powers set out in the Trust Deed, laws and regulations and otherwise in accordance with the provisions of the Trust Deed.

As of 1 March 2011, the Trustee has changed from RBC Dexia Trust Services Singapore Limited to HSBC Institutional Trust Services (Singapore) Limited (the “Trustee”).

For and on behalf of the TrusteeHSBC INSTITUTIONAL TRUST SERVICES (SINGAPORE) LIMITED

Authorised signatory

19 March 2012


11

STATEMENT BY THE MANAGER

In the opinion of the directors of UOB Asset Management Ltd, the accompanying financial statements set out on pages 13 to 31, comprising the Statement of Total Return, Balance Sheet, Portfolio Statement and Notes to the Financial Statements are drawn up so as to present fairly, in all material respects, the financial position of the Fund as at 31 December 2011 and the total deficit for the year then ended in accordance with the recommendations of Statement of Recommended Accounting Practice 7 “Reporting Framework for Unit Trusts” issued by the Institute of Certified Public Accountants of Singapore. At the date of this statement, there are reasonable grounds to believe that the Fund will be able to meet its financial obligations as and when they materialise.

For and on behalf of the ManagerUOB ASSET MANAGEMENT LTD

THIO BOON KIAT Authorised signatory

19 March 2012


12

INDEPENDENT AUDITOR’S REPORT TO THE UNITHOLDERS OFUNITED ASIA PACIFIC INFRASTRUCTURE FUND(Constituted under a Trust Deed in the Republic of Singapore)

We have audited the accompanying financial statements of United Asia Pacific Infrastructure Fund (the “Fund”) set out on pages 13 to 31, which comprise the Balance Sheet and Portfolio Statement as at 31 December 2011, the Statement of Total Return for the year then ended, and a summary of significant accounting policies and other explanatory information.

Manager’s Responsibility for the Financial Statements

The Fund’s Manager (the “Manager”) is responsible for the preparation and fair presentation of these financial statements in accordance with the recommendations of Statement of Recommended Accounting Practice 7 “Reporting Framework for Unit Trusts” issued by the Institute of Certified Public Accountants of Singapore, and for such internal control as the Manager determines is necessary to enable the preparation of financial statements that are free from material misstatements, whether due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with Singapore Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal controls. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the Manager, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Fund as at 31 December 2011 and the total deficit for the year then ended in accordance with the recommendations of Statement of Recommended Accounting Practice 7 “Reporting Framework for Unit Trusts” issued by the Institute of Certified Public Accountants of Singapore.

PricewaterhouseCoopers LLPPublic Accountants and Certified Public Accountants

Singapore, 19 March 2012


13

STATEMENT OF TOTAL RETURNFor the financial year ended 31 December 2011

2011 2010 Note $ $IncomeDividends 1,409,721 1,802,559 Interest 256 52

1,409,977 1,802,611

Less: Expenses Management fee 9 1,059,209 1,333,195 Trustee fee 9 28,246 35,552 Audit fee 15,301 13,999 Registrar fee 9 25,000 25,000 Valuation fee 9 88,267 111,100 Custody fee 53,146 68,413 Interest expenses 731 129 Other expenses 170,665 75,991

1,440,565 1,663,379

Net (loss)/ income (30,588) 139,232

Net gains or losses on value of investments Net realised loss on investments (3,663,380) (1,130,624)Net change in fair value on investments (21,217,946) 12,191,766 Net foreign exchange loss (79,721) (148,299)

Net (loss)/gain on value of investments (24,961,047) 10,912,843

Total (deficit)/return for the year before tax (24,991,635) 11,052,075 Less : Income tax 3 (108,086) (124,596)Less : Capital gain tax 3 - (7,479)

Total (deficit)/return for the year (25,099,721) 10,920,000

The accompanying notes form an integral part of these financial statements.


14

BALANCE SHEETAs at 31 December 2011

2011 2010 Note $ $

ASSETSPortfolio of investments 42,203,817 89,209,550 Receivables 4 41,159 44,999 Cash and bank balances 8,586,824 3,594,201

Total Assets 50,831,800 92,848,750

LIABILITIES Payables 5 546,118 759,072 Purchase awaiting settlement 648,650 - Net assets attributable to unitholders 6 49,637,032 92,089,678

Total Liabilities 50,831,800 92,848,750



15


PORTFOLIO STATEMENTAs at 31 December 2011

Percentage of total net assets attributable to Holdings at Fair value at unitholders at 31 December 31 December 31 December 2011 2011 2011 $ %By Geography - Primary Quoted Equities

AUSTRALIAAQUARIUS PLATINUM LIMITED 200,000 619,465 1.25 BHP BILLITON LIMITED 30,000 1,372,662 2.77 MEDUSA MINING LIMITED 90,000 532,395 1.07 OIL SEARCH LTD 80,000 664,663 1.34

TOTAL AUSTRALIA 3,189,185 6.43

CHINA CHAOWEI POWER HOLDINGS LTD 2,200,000 1,179,015 2.38 CHINA COMMUNICATIONS CONSTRUCTION CO LTD 1,000,000 1,010,060 2.03 CHINA EVERBRIGHT INTERNATIONAL LIMITED 3,239,000 1,519,529 3.06 CHINA OILFIELD SERVICES LTD - H 300,000 609,041 1.23 CHINA PETROLEUM & CHEM CORP (SINOPEC) 858,000 1,170,311 2.36 CHINA RESOURCES GAS GROUP LTD 450,000 830,921 1.67 CHINA RESOURCES LAND LIMITED 350,000 726,909 1.46 CHINA SHENHUA ENERGY COMPANY LIMITED 210,000 1,178,014 2.37 CHINA STATE CONSTRUCTION INTL HOLDINGS LTD 1,440,000 1,324,664 2.67 COSCO PACIFIC LIMITED 600,000 907,551 1.83 ENN ENERGY HOLDINGS LTD 234,000 966,903 1.95 GUANGDONG INVESTMENT LIMITED 1,056,000 832,143 1.68 LEE & MAN PAPER MANUFACTURING 158,000 65,682 0.13 SHANGHAI ELECTRIC GROUP COMPANY LIMITED 1,600,000 950,959 1.92 SHENZHEN EXPRESSWAY COMPANY 1,384,000 755,572 1.52 ZHUZHOU CSR TIMES ELECTRIC COMPANY LIMITED 400,000 1,135,274 2.29 ZOOMLION HEAVY INDUSTRY SC & TECH 300,000 417,714 0.84

TOTAL CHINA 15,580,262 31.39


16


Percentage of total net assets attributable to Holdings at Fair value at unitholders at 31 December 31 December 31 December 2011 2011 2011 $ %By Geography - Primary (continued)Quoted Equities

HONG KONGCST MINING GROUP LTD 40,000,000 420,719 0.85 HUTCHISON TELECOMMUNICATIONS HK HLDGS 1,768,000 879,610 1.77 POWER ASSETS HOLDINGS LTD 60,000 573,981 1.16 SMARTONE TELECOMMUNICATIONS 420,000 939,606 1.89 SUN HUNG KAI PROPERTIES LIMITED 50,000 809,718 1.63

TOTAL HONG KONG 3,623,634 7.30

INDIA IRB INFRASTRUCTURE DEVELOPERS LTD 128,027 407,005 0.82 LARSEN N TOUBRO (INR) 20,429 496,141 1.00 NATIONAL HYDROELECTRIC POWER CORP LTD 1,083,087 477,340 0.96 NTPC LIMITED 229,664 897,503 1.81 OIL & NATURAL GAS CORP LTD 77,586 485,628 0.98 TATA POWER COMPANY LIMITED 400,000 852,144 1.71 ZEE ENTERTAINMENT ENTERPRISE LIMITED 166,836 480,683 0.97

TOTAL INDIA 4,096,444 8.25

INDONESIA PT INDIKA ENERGY 3,258,000 1,001,670 2.02

JAPAN KOMATSU LIMITED 90,000 2,724,077 5.49



17


Percentage of total net assets attributable to Holdings at Fair value at unitholders at 31 December 31 December 31 December 2011 2011 2011 $ %By Geography - Primary (continued)Quoted Equities PHILIPPINESENERGY DEVELOPMENT CORPORATION 4,792,500 885,616 1.78

SINGAPORE CAPITACOMMERCIAL TRUST 500,000 525,000 1.06 CDL HOSPITALITY TRUST 400,000 618,000 1.24 KEPPEL CORPORATION LIMITED 120,000 1,116,000 2.25 MAPLETREE COMMERCIAL TRUST 900,000 760,500 1.53 SAKARI RESOURCES LTD 320,000 588,800 1.18 SEMBCORP INDUSTRIES LTD 380,000 1,539,000 3.10 SINGAPORE LAND LIMITED 50,000 276,500 0.56 SINGAPORE TELECOMMUNICATIONS LTD 250,000 772,500 1.56 STX OSV HOLDINGS LTD 650,000 754,000 1.52 SUNTEC REIT 500,000 537,500 1.08

TOTAL SINGAPORE 7,487,800 15.08

SOUTH KOREA GS ENGINEERING & CONSTRUCTION CORPORATION 8,000 828,415 1.67 HYUNDAI ENGINEERING AND CONSTRUCTION CO LTD 18,000 1,424,289 2.87 HYUNDAI MOTOR COMPANY 3,300 791,159 1.59

TOTAL SOUTH KOREA 3,043,863 6.13

THAILAND SUPALAI PUBLIC COMPANY LIMITED-FOREIGN 1,000,000 571,266 1.15


Net assets attributable to unitholders 49,637,032 100.00



18


Percentage of Percentage of total net assets total net assets attributable to attributable to unitholders at unitholders at 31 December 31 December 2011 2010 % %By Geography - Primary (Summary)Quoted Equities

Australia 6.43 10.64 Canada - 1.28 China 31.39 32.23 Hong Kong 7.30 6.16 India 8.25 3.51 Indonesia 2.02 2.69 Japan 5.49 5.94 Malaysia - 0.55 Norway - 1.73 Philippines 1.78 7.78 Singapore 15.08 17.61 South Korea 6.13 6.75 Thailand 1.15 -

Portfolio of investments 85.02 96.87 Other net assets 14.98 3.13

Net assets attributable to unitholders 100.00 100.00



19


Percentage of Percentage of total net assets total net assets attributable to attributable to Fair value at unitholders at unitholders at 31 December 31 December 31 December 2011 2011 2010 $ % %By Industry - SecondaryQuoted Equities

Consumer Discretionary 2,450,857 4.94 6.89 Consumer Staples - - 3.29 Energy 5,698,127 11.48 7.28 Financials 5,246,112 10.56 9.50 Industrials 17,310,250 34.88 44.63 Information Technology - - 0.80 Materials 2,590,204 5.22 18.43 Telecommunication Services 2,591,716 5.22 - Utilities 6,316,551 12.72 6.05

Portfolio of investments 42,203,817 85.02 96.87 Other net assets 7,433,215 14.98 3.13

Net assets attributable to unitholders 49,637,032 100.00 100.00



20

NOTES TO THE FINANCIAL STATEMENTSFor the financial year ended 31 December 2011

These notes form an integral part of and should be read in conjunction with the accompanying financial statements.

1. General

United Asia Pacific Infrastructure Fund (the “Fund”) is a Singapore-registered trust fund constituted by a Trust Deed dated 31 August 2006 between UOB Asset Management Ltd (the “Manager”) and RBC Dexia Trust Services Singapore Limited (the “Trustee”). The Deed and all supplemental deeds are governed by the laws of the Republic of Singapore.

With effect from 1 March 2011, the Trustee of the Fund has changed from RBC Dexia Trust Services Singapore Limited (the “Retired Trustee”) to HSBC Institutional Trust Services (Singapore) Limited (the “Trustee”).

The primary activity of the Fund is that of investment trading. The Fund’s investment objective is to achieve medium to long term capital growth by investing in securities (equities or equity-related securities) issued by companies which carry on infrastructure-related businesses in the Asia-Pacific region.

2. Significant accounting policies

(a) Basis of accounting

The financial statements have been prepared under the historical cost convention, modified by the revaluation of financial assets at fair value through profit or loss, and in accordance with the Statement of Recommended Accounting Practice 7 “Reporting Framework for Unit Trusts” (“RAP 7”) issued by the Institute of Certified Public Accountants of Singapore.

The financial statements are expressed in Singapore dollars.

(b) Recognition of income

Dividend income is recognised when the right to receive payment is established. Interest income is recognised on a time proportion basis using the effective interest method.

(c) Investments

Investments are classified as financial assets at fair value through profit or loss.

(i) Initial recognition

Purchase of investments are recognised on the trade date. Investments are recorded at fair value on initial recognition.


21


2. Significant accounting policies (continued)

(c) Investments (continued)

(ii) Subsequent measurement

Investments are subsequently carried at fair value. Net change in fair value on investments are included in the Statement of Total Return in the year in which they arise.

(iii) Derecognition

Investments are derecognised on the trade date of disposal. The resultant realised gains and losses on the sale of investments are computed on the basis of the difference between the weighted average cost and selling price net of transaction costs, and are taken up in the Statement of Total Return.

(d) Basis of valuation of investments The fair value of financial instruments traded in active markets is based on quoted market

prices at the balance sheet date. The quoted market price for these investments held by the Fund is the current market quoted bid price.

(e) Foreign currency translation

(i) Functional and presentation currency

The Fund’s investors are mainly from Singapore with the subscriptions and redemptions of the units denominated in Singapore dollars and United States dollars.

The performance of the Fund is measured and reported to the investors in Singapore dollars. The Manager considers the Singapore dollars as the currency of the primary economic environment in which the Fund operates. The financial statements are presented in Singapore dollars, which is the Fund’s functional and presentation currency.

(ii) Transactions and balances

Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the Statement of Total Return. Translation differences on non-monetary financial assets and liabilities are also recognised in the Statement of Total Return within the fair value net gain or loss.


22


2. Significant accounting policies (continued)

(f) Financial derivatives

Financial derivatives including forwards and swaps are entered into for the purpose of efficient portfolio management, tactical asset allocation or specific hedging of financial assets held as determined by the Manager and in accordance with the provisions of the Trust Deed.

Financial derivatives outstanding at the balance sheet date are valued at forward rates or at current market prices using the “mark-to-market” method, as applicable, and the resultant gains and losses are taken up in the Statement of Total Return.

(g) Expenses charged to the Fund

All direct expenses relating to the Fund are charged directly to the Statement of Total Return. In addition, certain expenses shared by all unit trusts managed by the Manager are allocated to each Fund based on the respective Fund’s net asset value.

3. Income tax and capital gain tax 2011 2010 $ $

Overseas income tax 71,109 91,444 Singapore income tax 36,977 33,152

Total income tax 108,086 124,596

Capital gain tax - 7,479

The Fund was granted the status of a Designated Unit Trust and, therefore, the following income is exempt from tax in accordance with section 35(12) of the Income Tax Act (Cap 134):

(i) gains or profits derived from Singapore or elsewhere from the disposal of securities;

(ii) interest (other than interest for which tax has been deducted under Section 45 of the Singapore Income Tax Act); and

(iii) dividends derived from outside Singapore and received in Singapore.

The Singapore income tax represents tax deducted at source for Singapore sourced dividends. The overseas income tax represents tax withheld on foreign sourced income.


23


4. Receivables 2011 2010 $ $

Amounts receivable for creation of units 4,125 31,574 Dividend receivable 37,034 13,411 Other receivable - 14

41,159 44,999

5. Payables 2011 2010 $ $

Amounts payable for cancellation of units 305,895 311,979 Amount due to Manager 214,057 409,132 Amount due to Trustee 5,264 17,760 Other creditors and accrued expenses 20,902 20,201

546,118 759,072

6. Net assets attributable to unitholders 2011 2010 $ $

At the beginning of the financial year 92,089,678 96,927,686

OperationsChange in net assets attributable to unitholders resulting from operations (25,099,721) 10,920,000

Unitholders’ contributions/(withdrawals)Creation of units 4,471,585 7,684,157 Cancellation of units (21,824,510) (23,442,165)

Change in net assets attributable to unitholders resulting from net creation and cancellation of units (17,352,925) (15,758,008)

Total decrease in net assets attributable to unitholders (42,452,646) (4,838,008)

At the end of the financial year 49,637,032 92,089,678

Units in issue (Note 7) 71,692,425 91,727,676

$ $

Net assets attributable to unitholders per unit 0.69 1.00


24


7. Units in issue 2011 2010

Units at beginning of the year 91,727,676 109,870,461 Units created 4,670,721 8,270,872 Units cancelled (24,705,972) (26,413,657)

Units at end of the year 71,692,425 91,727,676

8. Financial risk management

The Fund’s activities expose it to a variety of financial risk (including currency risk, interest rate risk and price risk), credit risk and liquidity risk. The Fund’s overall risk management programme seeks to minimise potential adverse effects on the Fund’s financial performance. The Fund may use financial futures contracts, financial options contracts and/or currency forward contracts subject to the terms of the Prospectus to moderate certain risk exposures. Specific guidelines on exposures to individual securities and certain industries are in place for the Fund at any time as part of the overall financial risk management to reduce the Fund’s risk exposures.

The Fund’s assets principally consist of financial instruments such as equity investments and cash. They are held in accordance with the published investment policies of the Fund. The allocation of assets between the various types of investments is determined by the Manager to achieve their investment objectives.

(a) Market risk

Market risk is the risk of loss arising from uncertainty concerning movements in market prices and rates, including observable variables such as interest rates, credit spreads, exchange rates, and others that may be only indirectly observable such as volatilities and correlations. Market risk includes such factors as changes in economic environment, consumption pattern and investor’s expectation etc. which may have significant impact on the value of the investments. The Fund’s investments are substantially dependent on changes in market prices. The Fund’s investments are monitored by the Manager on a regular basis so as to assess changes in fundamentals and valuation. Although the Manager makes reasonable efforts in the choice of investments, events beyond reasonable control of the Manager could affect the prices of the underlying investments and hence the asset value of the Fund. Guidelines are set to reduce the Fund’s risk exposures to market volatility such as diversifying the portfolio by investing across various geographies, alternatively, the Fund may be hedged using derivative strategies.


25


8. Financial risk management (continued)

(a) Market risk (continued)

(i) Foreign exchange risk

The Fund has securities denominated in currencies other than Singapore dollars and it may be affected favourably or unfavourably by exchange rate regulations or changes in the exchange rates between the Singapore dollars and such other currencies. The Manager may at his discretion, implement a currency management strategy either to reduce currency volatility or to hedge the currency exposures of the Fund.

The table below summarises the on-balance sheet exposure to currency risks for the Fund.

As at 31 December 2011

SGD KOW HKD AUD INR Others Total $ $ $ $ $ $ $

AssetsPortfolio of investments 7,487,800 3,043,863 19,203,896 3,189,185 4,096,444 5,182,629 42,203,817 Receivables 20,185 - 20,034 - - 940 41,159 Cash and bank balances 5,517,162 185 - - 407,882 2,661,595 8,586,824

Total Assets 13,025,147 3,044,048 19,223,930 3,189,185 4,504,326 7,845,164 50,831,800

LiabilitiesPayables 318,796 - - - - 227,322 546,118 Purchase awaiting settlement - - - - 407,882 240,768 648,650 Net assets attributable to unitholders 49,637,032 - - - - - 49,637,032

Total Liabilities 49,955,828 - - - 407,882 468,090 50,831,800

Net currency exposure (36,930,681) 3,044,048 19,223,930 3,189,185 4,096,444 7,377,074


26




(i) Foreign exchange risk (continued)

As at 31 December 2010

SGD JPY HKD AUD IDR Others Total $ $ $ $ $ $ $

AssetsPortfolio of investments 16,945,480 5,469,951 36,222,196 10,976,802 2,474,125 17,120,996 89,209,550 Receivables 40,540 - - - 2,278 2,181 44,999 Cash and bank balances 2,325,053 - - - - 1,269,148 3,594,201

Total Assets 19,311,073 5,469,951 36,222,196 10,976,802 2,476,403 18,392,325 92,848,750

LiabilitiesPayables 714,435 - - - - 44,637 759,072 Net assets attributable to unitholders 92,089,678 - - - - - 92,089,678

Total Liabilities 92,804,113 - - - - 44,637 92,848,750

Net currency exposure (73,493,040) 5,469,951 36,222,196 10,976,802 2,476,403 18,347,688

Investments, which is the significant item in the balance sheet is exposed to currency risk and other price risk. The other price risk sensitivity analysis includes the impact of currency risk on non-monetary investments. The Fund’s net financial assets comprise significantly non-monetary investments, hence currency risk sensitivity analysis has not been performed on the remaining financial assets.


27




(ii) Price risk

Price risk is the risk of potential adverse changes to the value of financial investments because of changes in market conditions and volatility in security prices.

The table below summarises the impact of increases/decreases from the Fund’s

underlying investments in equities on the Fund’s net assets attributable to unitholders at 31 December 2011 and 2010. The analysis is based on the assumption that the index components within the benchmark increased / decreased by a reasonable possible shift, with all other variables held constant and that the fair value of the Fund’s investments moved according to the historical correlation with the index.

2011 2010Benchmark component Net impact to Net impact to net assets net assets attributable to attributable to unitholders unitholders $ % $ %

80% MSCI Asia Pacific ex Japan, 20% MSCI Japan 8,187,540 20 20,875,035 20

(iii) Interest rate risk Interest rate risk is the risk that the value of a financial instrument will fluctuate due to

changes in market interest rates. Other than cash balances, the Fund’s financial assets and liabilities are largely non-

interest bearing. Hence, the Fund is not subjected to significant risk due to fluctuations in the prevailing levels of market interest rates.

(b) Liquidity risk

The Fund is exposed to daily cash redemptions and disbursements for the settlements of purchases. The Manager therefore ensures that the Fund maintains sufficient cash and cash equivalents and that it is able to obtain cash from the sale of investments held to meet its liquidity requirements. Reasonable efforts will be taken to invest in securities which are traded in a relatively active market and which can be readily disposed of.


28



(b) Liquidity risk (continued)

The Fund’s investments in listed securities are considered to be readily realisable as they are listed on established regional stock exchanges.

The table below analyses the Fund’s financial liabilities into relevant maturity groupings

based on the remaining period at the balance sheet date to the contractual maturity date. The amounts in the table are the contractual undiscounted cash flows. Balances due within 12 months equal their carrying balances, as the impact of discounting is not significant.

As at 31 December 2011 Less than 3 months Above 3 months to 1 year 1-5 years 5 years $ $ $ $ Payables 546,118 - - - Purchase awaiting settlement 648,650 - - - Net assets attributable to unitholders 49,637,032 - - -

As at 31 December 2010 Less than 3 months Above 3 months to 1 year 1-5 years 5 years $ $ $ $ Payables 759,072 - - - Net assets attributable to unitholders 92,089,678 - - -

(c) Credit risk

The Fund takes on exposure to credit risk, which is the risk that a counterparty will be unable to pay amounts in full when due. The Fund’s credit risk is concentrated on amounts or securities receivable on the sale and purchase of investments respectively. In order to mitigate exposure to credit risk, all transactions in listed securities are settled/paid for upon delivery and transacted with approved counterparties using an approved list of brokers that are regularly assessed and updated by the Manager.


29



(c) Credit risk (continued)

The table below summarises the credit rating of banks and custodians in which the Fund’s assets are held as at 31 December 2011 and 2010.

The credit ratings are based on the Bank Financial Strength ratings published by the rating agency.

As at 31 December 2011 Source of Credit rating credit rating

Bank State Street Bank & Trust Co. B Moody’sUnited Overseas Bank Limited B Moody’s Custodian State Street Bank & Trust Co. B Moody’s

As at 31 December 2010 Source of Credit rating credit rating

Bank State Street Bank & Trust Co. B Moody’sUnited Overseas Bank Limited B Moody’s Custodian State Street Bank & Trust Co. B Moody’s

The maximum exposure to credit risk at the reporting date is the carrying amount of the financial assets.

(d) Capital management

The Fund’s capital is represented by the net assets attributable to unitholders. The Fund strives to invest the subscriptions of redeemable participating units in investments that meet the Fund’s investment objectives while maintaining sufficient liquidity to meet unitholder redemptions.


30


9. Related party transactions

(a) The Manager of the Fund is UOB Asset Management Ltd, a subsidiary of United Overseas Bank Limited. With effect from 1 March 2011, RBC Dexia Trust Services Singapore Limited retired as the Trustee of the Fund and the new Trustee is HSBC Institutional Trust Services (Singapore) Limited. RBC Dexia Trust Services Singapore Limited is a subsidiary of RBC Investor Services, a joint venture between Dexia Banque Internationale A. Luxembourg S.A. and Royal Bank Of Canada. HSBC Institutional Trust Services (Singapore) Limited is a subsidiary of HSBC Holdings Plc.

Management, valuation and performance fees are paid to the Manager, while trustee fee is paid to the respective Trustee for the relevant period and the registrar fee is paid to HSBC Institutional Trust Services (Singapore) Limited, a subsidiary of HSBC Holdings Plc. These fees paid or payable by the Fund are shown in the Statement of Total Return and in the respective Notes to the Financial Statements, and are on terms set out in the Trust Deed. All other related party transactions are shown elsewhere in the financial statements.

(b) As at the end of the financial year, the Fund maintained the following account with a related party:

2011 2010 $ $

United Overseas Bank LimitedBank balances 82,183 93,463

(c) The following transactions took place during the financial year between the Fund and United Overseas Bank Limited at terms agreed between the parties:

2011 2010 $ $

Bank charges 50 30


31


9. Related party transactions (continued)

(d) UOB Kay Hian Pte Ltd is an affiliate company of United Overseas Bank Limited.

As at the end of the financial year, the Fund has brokerage fee paid or payable to UOB Kay Hian Pte Ltd as follows:

2011 2010 $ $

Brokerage charges 9,637 416

10. Financial ratios 2011 2010

Expense ratio 1 2.05% 1.87%Turnover ratio 2 74.85% 75.70%

11. Comparatives

For the financial year ended 31 December 2010, an amount of $1 has been reclassified from “Other Expenses” to “Registrar Fees” in the Statement of Total Return. There is no impact to the net assets attributable to unitholders by this reclassification.

1 The expense ratio is computed in accordance with the IMAS guidelines on disclosure of expense ratios dated 25 May 2005. Brokerage and other transaction costs, interest expense, foreign exchange gains/losses, tax deducted at source or arising on income received and dividends paid to unitholders are not included in the expense ratio. The Fund has not paid any performance fees during the year.

2 The turnover ratio is calculated in accordance with the formula stated in the “Code on Collective Investment Schemes”.


32

This page has been intentionally left blank.

Documents

United Asia Pacific Infrastructure Fundinternetfileserver.phillip.com.sg/poems/unittrust/reports/036360_ar_122011.pdfEquity markets across the region were down sharply in 2011 due