29297 3024 E FS 2014 Semi Annual

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Semi-Annual Financial Statements
BMO Harris Private Portfolios
June 30, 2014
BMO Harris International Equity Portfolio


NOTICE OF NO AUDITOR REVIEW OF THE SEMI-ANNUAL FINANCIAL STATEMENTS
BMO Harris Investment Management Inc., the Manager of the Portfolios, appoints independent auditors to audit the
Portfolio’s Annual Financial Statements. Under Canadian securities laws (National Instrument 81-106), if an auditor has not
reviewed the Semi-Annual Financial Statements, this must be disclosed in an accompanying notice.
The Portfolio’s independent auditors have not performed a review of these Semi-Annual Financial Statements in accordance
with standards established by the Canadian Institute of Chartered Accountants.

BMO Harris International Equity Portfolio
(unaudited)

STATEMENT OF FINANCIAL POSITION
(All amounts in thousands of Canadian dollars, except per unit data)
June 30
2014

December 31
2013

January 1
2013

71,870

51,126

26,162

1,076,073
—
1,251
1,585
—
1,808
1,152,587

932,533
261
563
2,207
—
571
987,261

527,636
—
511
411
4
465
555,189

5,123
430
295
—
1,934
7,782

497
375
—
0
1,643
2,515

678
175
311
—
607
1,771

1,144,805

984,746

553,418

As at
Assets
Current Assets
Cash
Investments
Non-derivative financial assets
Derivative assets
Receivable for investments sold
Subscriptions receivable
Interest receivable
Dividends receivable
Total assets
Liabilities
Current Liabilities
Payable for investments purchased
Redemptions payable
Derivative liabilities
Distributions payable
Accrued expenses
Total liabilities
Net assets attributable to holders of redeemable
units
Net assets attributable to holders of redeemable
units per unit

$

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

11 .38

$

10 .98

$

8 .77

BMO Harris International Equity Portfolio
(unaudited)

STATEMENT OF COMPREHENSIVE INCOME
(All amounts in thousands of Canadian dollars, except per unit data)
For the periods ended
Income
Interest income
Dividend income
Other changes in fair value of investments and derivatives
Net realized gain
Change in unrealized (depreciation) appreciation
Net gain in fair value of investments and derivatives
Foreign exchange loss on cash
Total other loss
Total income
Expenses
Sub-advisory fees
Audit fees
Independent review committee fees
Withholding taxes
Custodian fees
Legal and filing fees
Unitholder servicing fees
Printing and stationery fees
Commissions and other portfolio transaction costs (note 6)
Operating expenses absorbed by the Manager
Total expenses
Increase in net assets attributable to holders of redeemable units
Increase in net assets attributable to holders of redeemable units per unit
(note 3)

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

June 30
2014

June 30
2013

158
21,448

11
11,961

28,891
(6,370 )
44,127
(12 )
(12 )

22,459
26,474
60,905
(14 )
(14 )

44,115

60,891

2,734
10
4
3,384
223
36
221
7
1,032
(887 )
6,764

1,483
10
1
1,803
141
25
215
10
625
(447 )
3,866

37,351

57,025

0 .39

0 .87

BMO Harris International Equity Portfolio
(unaudited)

STATEMENT OF CHANGES IN NET ASSETS ATTRIBUTABLE TO HOLDERS OF REDEEMABLE UNITS
(All amounts in thousands of Canadian dollars)
For the periods ended

June 30
2014

June 30
2013

Net assets attributable to holders of redeemable units at beginning of period

984,746

553,418

37,351

57,025

Redeemable unit transactions
Proceeds from redeemable units issued
Redemption of redeemable units
Net increase from redeemable unit transactions

181,612
(58,904 )
122,708

131,316
(77,786 )
53,530

Net increase in net assets attributable to holders of redeemable units

160,059

110,555

1,144,805

663,973

Increase in net assets attributable to holders of redeemable units

Net assets attributable to holders of redeemable units at end of period

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

BMO Harris International Equity Portfolio
(unaudited)

STATEMENT OF CASH FLOWS
(All amounts in thousands of Canadian dollars)
June 30
2014

June 30
2013

37,351

57,025

12
(28,891 )

14
(22,459 )

6,370
(688 )
—
(1,237 )
4,626
292
989
(194 )
(332,223 )
212,721
(1,757 )
(102,629 )

(26,474 )
(324 )
4
(649 )
(183 )
1,014
452
(105 )
(192,735 )
156,055
(851 )
(29,216 )

182,234
(58,849 )
123,385

129,659
(77,439 )
52,220

Foreign exchange loss on cash
Net increase in cash
Cash at beginning of period
Cash at end of period

(12 )
20,756
51,126
71,870

(14 )
23,004
26,162
49,152

Supplementary Information
Interest received, net of withholding taxes*
Dividends received, net of withholding taxes*

158
16,827

15
9,509

For the periods ended
Cash flows from operating activities
Increase in net assets attributable to holders of redeemable units
Adjustments for:
Foreign exchange loss on cash
Net realized gain on sale of investments and derivatives
Change in unrealized depreciation (appreciation) of investments and
derivatives
Increase in receivable for investments sold
Decrease in interest receivable
Increase in dividends receivable
Increase (decrease) in payable for investments purchased
Increase in accrued expenses
Return of capital distributions received
Dividend reinvestments
Purchases of investments
Proceeds from sale and maturity of investments
Net derivative settlements
Net cash from operating activities
Cash flows used in financing activities
Proceeds from issuances of redeemable units
Amounts paid on redemption of redeemable units
Net cash used in financing activities

*These items are from operating activities

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

BMO Harris International Equity Portfolio
(unaudited)

SCHEDULE OF INVESTMENT PORTFOLIO
As at June 30, 2014 (All amounts in thousands of Canadian dollars, unless otherwise noted)
Number of
Shares or Units

Cost+*
($)

Fair Value
($)

1,001,370
791,604
542,971
1,271,500
317,170
361,859
53,254
1,001,564
217,250
152,196
153,925

4,984
5,838
5,047
7,377
3,816
5,187
3,331
3,959
6,497
5,603
4,444
56,083

3,230
7,325
6,823
7,476
3,424
3,960
3,181
5,253
7,412
6,293
5,454
59,831

125,770
35,094
105,715
91,343

14,595
1,877
3,379
4,694
24,545

15,426
2,141
3,740
4,949
26,256

42,722

1,418

1,661

25,982
3,744,400
6,647,730
237,098

3,221
6,683
4,812
3,841
18,557

5,178
7,171
4,488
3,869
20,706

Denmark — 2.6%
Jyske Bank A/S
Novo Nordisk A/S, Class B
Pandora A/S
Vestas Wind Systems A/S

117,265
194,445
103,020
87,700

6,104
5,113
3,640
4,818
19,675

7,103
9,578
8,435
4,726
29,842

Finland — 1.0%
KONE Oyj, B Shares
Orion Oyj, B Shares

163,229
103,070

6,404
3,781
10,185

7,272
4,097
11,369

France — 9.2%
Accor SA
Altran Technologies SA
Compagnie Generale des Etablissements Michelin, Class B
Euler Hermes S.A.
L'Air Liquide S.A.
Legrand S.A.

78,297
250,930
38,567
25,140
79,820
70,693

4,324
3,016
3,513
3,196
8,696
2,910

4,342
2,859
4,923
3,221
11,499
4,611

Security
EQUITIES
Australia — 5.2%
BC Iron Limited
Brambles Industries Limited
Computershare Limited
Insurance Australia Group Limited
Newcrest Mining Limited
QBE Insurance Group Limited
Rio Tinto Limited, Australian Stock Exchange
Telstra Corporation Limited
Westpac Banking Corporation
Woodside Petroleum Ltd.
Woolworths Limited
Belgium — 2.3%
Anheuser-Busch InBev NV/SA
Arseus NV
Belgacom SA
Colruyt SA
Brazil — 0.1%
Embraer Empresa Brasileira de Aeronutica S.A., ADR
China — 1.8%
Baidu, Inc., ADR
CNOOC Limited
Industrial and Commercial Bank of China, H Shares
Tencent Holdings Limited

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

BMO Harris International Equity Portfolio
(unaudited)

SCHEDULE OF INVESTMENT PORTFOLIO (cont’d)
As at June 30, 2014 (All amounts in thousands of Canadian dollars, unless otherwise noted)
Number of
Shares or Units
44,594
67,760
83,419
36,056
109,430
56,739
331,295
323,847
56,480

Cost+*
($)
6,948
5,036
5,294
2,270
5,201
5,036
2,789
20,773
5,029
84,031

Fair Value
($)
9,166
5,068
7,556
2,456
7,641
6,440
2,863
24,966
8,082
105,693

86,149
30,940
14,365
91,941
308,602
55,310
56,610
82,971
69,580
60,656
29,297
102,010
105,206
52,683
67,370
98,310

7,593
2,882
2,256
4,031
9,236
1,763
1,762
5,534
1,997
3,027
2,495
4,487
6,886
1,818
2,955
6,332
65,054

9,311
3,843
2,738
3,452
11,909
2,352
1,922
5,958
3,358
3,066
3,616
4,850
8,671
3,062
3,167
5,984
77,259

2,489,525
433,100
1,273,640
251,271
249,005
2,076,000
625,500
347,900

10,092
4,711
13,991
4,598
2,514
2,521
4,768
3,866
47,061

13,367
5,051
13,194
5,005
2,696
3,540
5,839
4,934
53,626

Ireland — 0.8%
Accenture PLC, Class A
CRH Plc

70,077
119,886

5,095
2,659
7,754

6,045
3,294
9,339

Israel — 0.5%
Bezeq The Israel Telecommunication Corp., Ltd.
Teva Pharmaceutical Industries Ltd.

860,648
67,830

1,317
3,250
4,567

1,720
3,797
5,517

Security
LVMH Moet Hennessy Louis Vuitton S.A.
Orpea S.A.
Publicis Groupe SA
Rubis
Safran SA
Sanofi
Technicolor SA
Total S.A.
Valeo SA
Germany — 6.7%
adidas AG
BASF SE
Brenntag AG
Deutsche Bank AG
Deutsche Post AG
Drillisch AG
freenet AG
Fresenius Medical Care AG & Co. KGaA
Fuchs Petrolub SE, Preference
GEA Group Aktiengesellschaft
Henkel AG & Co. KGaA
ProSiebenSat.1 Media AG
SAP SE
Symrise AG
United Internet AG
Wincor Nixdorf AG
Hong Kong — 4.7%
AIA Group Limited
ASM Pacific Technology Limited
China Mobile Limited
Hong Kong Exchanges & Clearing Ltd.
HSBC Holdings PLC
Man Wah Holdings Limited
Power Assets Holdings Limited
VTech Holdings Limited

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

BMO Harris International Equity Portfolio
(unaudited)

SCHEDULE OF INVESTMENT PORTFOLIO (cont’d)
As at June 30, 2014 (All amounts in thousands of Canadian dollars, unless otherwise noted)
Number of
Shares or Units

Cost+*
($)

Fair Value
($)

Italy — 1.7%
Azimut Holdings SpA
Gtech S.p.A.
Intesa Sanpaolo S.p.A.
UnipolSai S.p.A.

181,210
141,999
1,420,623
1,827,650

3,136
3,904
3,620
4,237
14,897

4,984
3,703
4,673
6,272
19,632

Japan — 14.2%
Dowa Mining Company Ltd.
FANUC Corporation
Haseko Corporation
ITOCHU Corporation
Japan Airlines Co., Ltd.
Japan Tobacco Inc.
KDDI Corp.
KOSE Corporation
Kubota Corporation
Makita Corporation
Marubeni Corp.
Minebea Company Ltd.
Mitsubishi Electric Corporation
Mitsubishi Estate Company Ltd.
Mitsubishi UFJ Financial Group, Inc.
Mizuho Financial Group, Inc.
Nihon Kohden Corporation
Oriental Land Co., Ltd.
Pigeon Corporation
Softbank Corp.
Sumitomo Mitsui Financial Group, Inc.
Sumitomo Mitsui Trust Holdings, Inc.
Sumitomo Rubber Industries, Ltd.
Toyota Motor Corporation
Toyota Tsusho Corporation
Zenkoku Hosho Co. Ltd.

484,000
29,392
818,700
393,300
133,300
130,061
173,300
88,000
471,055
68,700
481,000
497,000
458,000
180,030
861,859
2,705,800
104,200
19,500
83,100
55,833
157,500
1,235,367
432,200
333,213
205,100
67,100

4,884
4,181
5,757
4,642
6,990
4,731
8,284
2,505
7,064
2,890
3,730
5,919
4,259
5,178
5,211
5,991
4,404
2,598
4,260
3,091
6,945
6,409
5,518
17,568
4,774
1,707
139,490

4,884
5,420
7,044
5,399
7,872
5,068
11,303
3,593
7,141
4,528
3,760
5,972
6,046
4,753
5,649
5,935
5,574
3,567
4,680
4,433
7,058
6,037
6,669
21,389
6,306
1,952
162,032

720,058

6,022

5,804

3,213,500
584,860
1,667,200
2,283,588

6,668
1,412
1,663
6,817
16,560

7,445
1,914
1,690
7,461
18,510

55,257
511,026
56,596

4,308
6,518
1,996

5,487
7,651
1,914

Security

Macau — 0.5%
Sands China Ltd.
Malaysia — 1.6%
Axiata Group Berhad
Lafarge Malaysia Berhad
Magnum Berhad
Malayan Banking Berhad
Netherlands — 4.3%
ASML Holding N.V.
ING Groep N.V.
Koninklijke (Royal) Philips Electronics N.V.
The accompanying notes are an integral part of these financial statements.

BMO Harris International Equity Portfolio
(unaudited)

SCHEDULE OF INVESTMENT PORTFOLIO (cont’d)
As at June 30, 2014 (All amounts in thousands of Canadian dollars, unless otherwise noted)
Number of
Shares or Units
103,891
246,008
277,620
126,908
101,260

Cost+*
($)
6,047
3,835
12,228
4,299
3,976
43,207

Fair Value
($)
5,416
6,018
12,256
5,889
4,726
49,357

304,260
138,350
150,706
78,450

4,390
4,633
2,679
3,961
15,663

5,931
4,554
3,659
4,197
18,341

Philippines — 0.4%
Alliance Global Group, Inc.

6,821,000

2,817

4,851

Singapore — 1.8%
ComfortDelGro Corporation Limited
Ezion Holdings Limited
Sembcorp Industries Ltd
Singapore Technologies Engineering Ltd.
United Overseas Bank Limited
Venture Corporation Limited

2,453,000
1,352,000
727,000
769,000
238,400
440,000

3,251
2,105
3,168
2,352
3,793
2,758
17,427

5,238
2,404
3,333
2,497
4,597
2,915
20,984

Spain — 2.0%
Amadeus IT Holding S.A., Class A
Banco Bilbao Vizcaya Argentaria, S.A.
Bolsas y Mercados Espanoles

239,489
444,730
123,820

7,491
5,486
5,711
18,688

10,528
6,041
6,310
22,879

Sweden — 3.9%
Assa Abloy AB, B Shares
Atlas Copco AB, A Shares
Billerud Aktiebolag
H & M Hennes & Mauritz AB, B Shares
NCC AB, B Shares
Skanska AB, B Shares
Svenska Cellulosa AB (SCA), Class B
Swedbank AB

95,144
156,187
306,810
118,063
196,460
248,410
176,131
204,210

3,589
3,919
4,745
4,147
5,901
5,166
5,383
4,082
36,932

5,160
4,811
4,751
5,501
7,214
6,045
4,894
5,775
44,151

Switzerland — 9.2%
Adecco S.A.
Aryzta AG
Givaudan SA
Holcim Ltd.
Julius Baer Group Ltd.
Nestle S.A.
Novartis AG
Panalpina Welttransport Holding AG

54,430
48,110
1,312
26,332
92,131
266,790
210,824
17,065

4,921
4,919
1,160
2,592
3,321
17,159
13,941
1,790

4,776
4,859
2,335
2,470
4,054
22,057
20,378
2,883

Security
Koninklijke Vopak NV
Reed Elsevier NV
Royal Dutch Shell PLC, A Shares, London Exchange
Royal Dutch Shell plc, Class B
Unilever N.V.
Norway — 1.6%
DnB ASA
Statoil ASA
Telenor ASA
Yara International ASA

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

BMO Harris International Equity Portfolio
(unaudited)

SCHEDULE OF INVESTMENT PORTFOLIO (cont’d)
As at June 30, 2014 (All amounts in thousands of Canadian dollars, unless otherwise noted)
Number of
Shares or Units
61,810
14,069
60,370
5,427
345,930
15,599

Cost+*
($)
13,523
1,757
3,478
1,919
7,864
3,413
81,757

Fair Value
($)
19,681
2,281
5,733
2,164
6,763
5,018
105,452

Taiwan — 1.6%
Advantech Co., Ltd.
Chunghwa Telecom Co., Ltd.
MediaTek Inc.
Taiwan Semiconductor Manufacturing Company Limited, ADR

398,300
1,140,165
215,669
280,359

1,062
3,503
2,275
5,619
12,459

3,632
3,920
3,897
6,399
17,848

United Kingdom — 15.3%
Ashtead Group Public Limited Company
Aviva plc
Berkeley Group Holdings PLC, The,
BP p.l.c.
British American Tobacco p.l.c.
British Sky Broadcasting Group plc
BT Group plc
Burberry Group PLC
Carnival PLC
Compass Group PLC
Ensco plc, Class A
Experian plc
GlaxoSmithKline plc
Hays plc
Interserve Plc
ITV plc
Kentz Corporation Limited
Kingfisher plc
Legal & General Group Plc
National Grid plc
Pace PLC
Pearson plc
Persimmon PLC
Persimmon PLC, C Shares**
Prudential plc
Reckitt Benckiser Group plc
Rio Tinto plc, London Stock Exchange
Rolls-Royce Holdings PLC
Rolls-Royce Holdings Plc, C Shares**
Royal Dutch Shell PLC, Class A, Euronext Amsterdam Exchange
SABMiller plc
Shire plc
SSE plc
Standard Chartered PLC

304,290
519,282
88,340
528,601
73,203
235,939
562,884
153,380
124,593
298,300
56,798
358,173
197,174
1,036,150
390,540
1,378,860
210,890
1,173,853
1,342,863
304,041
345,520
180,432
219,210
216,830
306,870
98,012
68,924
46,185
26,451,466
179,449
94,295
77,700
167,496
193,885

2,476
4,898
3,267
4,440
3,230
2,536
3,954
3,395
5,163
4,317
3,242
6,942
5,142
2,227
3,363
3,192
2,813
5,086
3,065
3,523
2,954
3,169
3,470
—
4,815
6,511
3,851
670
—
6,128
3,719
3,454
3,893
4,578

4,856
4,856
3,917
4,967
4,648
3,891
3,951
4,150
5,016
5,557
3,368
6,455
5,622
2,760
4,273
4,482
3,574
7,687
5,528
4,661
2,251
3,799
5,086
277
7,510
9,121
3,968
900
48
7,923
5,830
6,501
4,790
4,228

Security
Roche Holding AG
Schindler Holding Ltd.
Swiss Re AG
Syngenta AG
UBS AG
Zurich Financial Services AG

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

BMO Harris International Equity Portfolio
(unaudited)

SCHEDULE OF INVESTMENT PORTFOLIO (cont’d)
As at June 30, 2014 (All amounts in thousands of Canadian dollars, unless otherwise noted)
Security
Tesco PLC
United Utilities Group Plc
Victrex PLC
Vodafone Group Public Limited Company
WPP plc
United States — 1.0%
Liberty Global plc, Class C
Schlumberger Limited
Total Investment Portfolio — 94.0%

Number of
Shares or Units
745,667
307,102
53,720
1,116,771
134,803

Cost+*
($)
4,638
3,668
1,845
4,500
2,490
140,624

118,443
45,639

2,880
3,661
6,541

5,347
5,744
11,091

892,014

1,076,073

Total Unrealized Loss on Forward Currency Contracts — (0.0)%

Fair Value
($)
3,865
4,943
1,668
3,983
3,132
174,042

(295 )

Other Assets Less Liabilities — 6.0%

69,027

NET ASSETS ATTRIBUTABLE TO HOLDERS OF REDEEMABLE UNITS — 100.0%

1,144,805

+ Where applicable, distributions received from holdings as a return of capital are used to reduce the adjusted cost base of the
securities in the portfolio
* For the purpose of the Statement of Investment Portfolio, cost includes commissions and other portfolio transaction cost (note 2).
** These securities have no quoted market value and are valued using valuation techniques (note 3).

UNREALIZED LOSS ON FORWARD CURRENCY CONTRACTS
As at June 30, 2014, the Portfolio had the following open positions:
Settlement
Currency Position Currency Position Contract
Date
Buy
(000s)
Sell
(000s)
Rates
16-Sep-14
CA$
36,611
AUD (36,817) 0.9944
Total Unrealized Loss on Forward Currency Contracts
**Credit rating provided by Standard & Poor's.

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

Credit
Counterparty Rating**
State Street Corp. A-1

Unrealized
Loss
(295)
(295)

BMO Harris International Equity Portfolio
(unaudited)

NOTES TO FINANCIAL STATEMENTS
(All amounts in thousands of Canadian dollars, except per unit data)
June 30, 2014

1.The Portfolio
BMO Harris International Equity Portfolio (“the
Portfolio”) is an open-ended mutual fund trust
established by a Declaration of Trust under the laws
of the Province of Ontario, most recently amended
on September 18, 2007. BMO Harris Investment
Management Inc. (“the Manger”) is the Manager of the
Portfolio. The address of the Portfolio’s registered office
is 1 First Canadian Place, 41st Floor, Toronto, Ontario.
The information provided in these interim financial
statements is for the periods ended June 30, 2014 and
June 30, 2013, except for the comparative information
in the Statement of Financial Position and the related
notes, which are as at December 31, 2013 and January
1, 2013.
These financial statements were authorized for issue by
BMO Trust Company, the trustee, on August 12, 2014.

2.Basis of preparation and presentation
These interim financial statements have been prepared
in accordance with International Accounting Standards
(“IAS”) IAS 34 Interim Financial Reporting. These
are the Portfolio’s first interim financial statements
during the first year of reporting in accordance with
International Financial Reporting Standards (“IFRS”) as
issued by the International Accounting Standards Board
(“IASB”).
As required by Canadian securities legislation and the
Canadian Accounting Standards Board, the Portfolio
has adopted this basis of accounting effective January
1, 2014. The Portfolio’s financial statements were
previously prepared in accordance with Canadian
generally accepted accounting principles (“Canadian
GAAP”), as previously defined and as described in the
notes to the Portfolio’s annual financial statements for
the year ended December 31, 2013. Canadian GAAP, as
previously defined, differs in some areas from IFRS. To
comply with IFRS, the Portfolio has amended certain
accounting policies, classification, measurement and
disclosure previously applied in the Canadian GAAP
financial statements.
As required under IFRS, the Portfolio has:
• provided comparative financial information including
an opening Statement of Financial Position as at the
transition date
• retroactively applied all IFRS, other than in respect of
elections taken under IFRS 1; and
• applied all mandatory exceptions as applicable for the
first-time adopters of IFRS.

The interim financial statements should be read in
conjunction with the Portfolio’s Canadian GAAP annual
financial statements for the year-ended December 31,
2013.
Note 8(h) contains reconciliations and descriptions of
the effects of the transition to IFRS on the Portfolio's
reported financial position, financial performance and
cash flows.
The policies applied in these interim financial
statements are based on IFRS issued and outstanding
as of August 12, 2014, the date the Manager approved
the statements. Any subsequent changes to IFRS that
are given effect in the Portfolio’s annual financial
statements for the period ending December 31, 2014
could result in a restatement of these interim financial
statements, including the transition adjustments.

3.Summary of significant accounting policies
Financial instruments
The Portfolio records financial instruments at fair value.
Investment transactions are accounted for on the trade
date. The Fund’s investments are either designated as
fair value through profit or loss (“FVTPL”) at inception
or classified as held for trading. The changes in the
investment fair values and related transaction costs are
recorded in the Portfolio’s Statement of Comprehensive
Income.
Financial assets or financial liabilities held for trading
are those acquired or incurred principally for the
purpose of selling or repurchasing in the near future,
or on initial recognition, are part of a portfolio of
identified financial instruments that the Portfolio
manages together and that have a recent actual pattern
of short-term profit taking. The Portfolio classifies all
derivatives and short positions as held for trading. The
Portfolio does not designate any derivatives as hedges
in a hedging relationship.
The Portfolio designates all other investments as
FVTPL, as they have reliably measurable fair values,
are part of a group of financial assets or liabilities that
are managed and have their performance evaluated
on a fair value basis in accordance with the Fund’s
investment strategy.
The Portfolio’s redeemable units contain multiple
contractual obligations and consequently, do not meet
the conditions to be classified as equity. As a result, the
Fund’s obligations for net assets attributable to holders
of redeemable units are presented at the redemption
amounts.

BMO Harris International Equity Portfolio
(unaudited)

NOTES TO FINANCIAL STATEMENTS (cont’d)
(All amounts in thousands of Canadian dollars, except per unit data)
June 30, 2014
All other financial assets and liabilities are measured at
amortized cost. Under this method, financial assets and
liabilities reflect the amount required to be received or
paid or discounted, when appropriate, at the contract’s
effective interest rate.

cash flows, internal models that utilize observable
data, or comparisons with other securities that are
substantially similar. In limited circumstances, the
Fund uses internal models where the inputs are not
based on observable market data.

Cost of investments
The cost of investments represents the amount paid
for each security and is determined on an average cost
basis.

Derivative instruments
Derivative instruments are financial contracts that
derive their value from underlying changes in interest
rates, foreign exchange rates, or other financial or
commodity prices or indices.

Fair value measurement
Investments are recorded at their fair value with the
change between this amount and their average cost
being recorded as change in unrealized appreciation
(depreciation) in the Statement of Comprehensive
Income.
For exchange traded securities, close prices are
considered to be fair value if they fall within the bidask spread. In circumstances where the close price is
not within the bid-ask spread, the Manager determines
the point within the bid-ask spread that is most
representative of fair value based on the specific facts
and circumstances.
Procedures are in place to fair value securities traded in
countries outside of North America daily, to avoid stale
prices and to take into account among, other things, any
significant events occurring after the close of a foreign
market.
For bonds, debentures, asset-backed securities and
other debt, securities fair value is represented by
bid prices provided by independent security pricing
services. Short-term investments, if any, are amortized
at cost which approximates fair value.
Exchange traded funds held as investments are valued
at their respective Net Asset Value (“NAV”) on each
Valuation Date (the “Valuation Date” is each day on
which the Toronto Stock Exchange is open for trading),
as these values are the most readily and regularly
available.
For securities where market quotes are not available,
unreliable or not considered to reflect the current
value, the Portfolio may determine another value
which it considers to be fair and reasonable, or using
a valuation technique that, to the extent possible,
makes maximum use of inputs and assumptions
based on observable market data, including volatility,
comparable companies and other applicable rates or
prices. These estimation techniques include discounted

Derivative instruments are either regulated exchangetraded contracts or negotiated over-the-counter
contracts. The Portfolio may use these instruments for
trading purposes, as well as to manage the Portfolio’s
risk exposures.
Derivatives are marked to fair value. Realized and
unrealized gains and losses are recorded in the
Statement of Comprehensive Income.
Forward currency contracts
A forward currency contract is an agreement between
two parties (the Portfolio and the counterparty) to
purchase or sell a currency against another currency at
a set price on a future date. The Portfolio may enter into
forward currency contracts for hedging purposes, which
can include the economic hedging of all or a portion
of the currency exposure of an investment or group of
investments, either directly or indirectly. The Portfolio
may also enter into these contracts for non-hedging
purposes, which can include increasing the exposure to
a foreign currency, or shifting the exposure to foreign
currency fluctuations from one country to another. The
value of forward currency contracts entered into by the
Portfolio is recorded as the difference between the value
of the contract on the Valuation Date and the value on
the date the contract originated.
Income recognition
Dividend income and distributions from investment
trust units are recognized on the ex-dividend and exdistribution date, respectively.
Interest income from interest bearing investments is
recognized in the Statement of Comprehensive Income
using the effective interest rate. Interest receivable
shown in the Statement of Financial Position is accrued
based on the interest bearing instruments’ stated rates
of interest.
Interest on inflation-indexed bonds is paid based
on a principal value, which is adjusted for inflation.

BMO Harris International Equity Portfolio
(unaudited)

NOTES TO FINANCIAL STATEMENTS (cont’d)
(All amounts in thousands of Canadian dollars, except per unit data)
June 30, 2014
The inflation adjustment of the principal value is
recognized as part of interest income in the Statement
of Comprehensive Income. If held to maturity, the
Portfolio will receive, in addition to a coupon interest
payment, a final payment equal to the sum of the par
value and the inflation compensation accrued from
the original issue date. Interest is accrued on each
Valuation Date based on the inflation adjusted par value
at that time and is included in “Interest income” in the
Statement of Comprehensive Income.

Other assets and other liabilities
Dividend receivable, interest receivable, distributions
from investment trust units receivable, due from broker
and subscriptions receivable, are initially measured
at fair value and subsequently measured at amortized
cost. Similarly, due to broker, redemptions payable and
accrued expenses, are initially measured at amortized
cost. Other assets and liabilities are short-term in
nature, and are carried at cost or amortized cost, which
approximates fair value.

Foreign currency translation
The fair value of investments and other assets and
liabilities in foreign currencies are translated into the
Portfolio’s functional currency at the rates of exchange
prevailing at the period-end date. Purchases and sales of
investments, and income and expenses are translated at
the rates of exchange prevailing on the respective dates
of such transactions. Foreign exchange gains (losses) on
completed transactions are included in “Realized gains
(losses)” and unrealized foreign exchange gains (losses)
are included in “Change in unrealized appreciation
(depreciation)” in the Statement of Comprehensive
Income. Foreign exchange gains and losses relating to
cash are included as "Foreign exchange gain (loss) on
cash".

Increase or decrease in net assets attributable to holders
of redeemable units
“Increase (decrease) in net assets attributable to
holders of redeemable units” in the Statement of
Comprehensive Income represents, the increase
(decrease) in net assets attributable to holders of
redeemable units divided by the weighted average
number of units outstanding during the period.

Securities lending
A Portfolio may engage in securities lending pursuant to
the terms of an agreement, which includes restrictions
as set out in Canadian securities legislation. Collateral
held is government Treasury Bills and qualified Notes.
Income from securities lending, where applicable, is
included in the Statement of Comprehensive Income
and is recognized when earned. The market value of
the securities loaned and collateral held is determined
daily. Aggregate values of securities held in trust as at
June 30, 2014, and December 31, 2013 and January 1,
2013, where applicable, are disclosed in Note 8(e).
Short-term trading penalty
To discourage excessive trading, the Portfolio may,
at the Manager’s sole discretion, charge a short-term
trading penalty. This penalty is paid directly to the
Portfolio and is included in “Short-term penalty fees” in
the Statement of Comprehensive Income.
Cash
Cash is comprised of cash and deposits with banks,
which include banker acceptances and overnight
demand deposits. Cash is recorded at amortized cost.

Taxation
The Portfolio qualifies as a mutual fund trust under
the provisions of the Income Tax Act (Canada).
Distributions of all net taxable income and sufficient
amounts of net realized capital gains for each taxation
year will be paid to unitholders so that the Portfolio will
not be subject to income tax. As a result, the Portfolio
has determined that it is in substance not taxable
and therefore does not record income taxes in the
Statement of Comprehensive Income and or recognize
any deferred tax assets in the Statement of Financial
Position.
The Portfolio may incur withholding taxes imposed
by certain countries on investment income and capital
gains. Such income and gains are recorded on a gross
basis with the related withholding taxes shown as a
separate expense in the Statement of Comprehensive
Income.
Investments in subsidiaries, joint ventures and associates
Subsidiaries are entities over which the Portfolio has
control through its exposure or rights to variable returns
from its investment, and has the ability to affect those
returns through its power over the entity. The Portfolio
has determined that it is an investment entity and as
such, it accounts for subsidiaries at fair value. Joint
ventures are those where the Portfolio exercises joint
control through an agreement with other shareholders.
Associates are investments in which the Portfolio exerts
significant influence over operating, investing, and
financing decisions (such as companies in which the

BMO Harris International Equity Portfolio
(unaudited)

NOTES TO FINANCIAL STATEMENTS (cont’d)
(All amounts in thousands of Canadian dollars, except per unit data)
June 30, 2014
Portfolio owns 20% - 50% of voting shares), all of which
have been designated at FVTPL.
Accounting standards issued but not yet adopted
Below are accounting standards issued or amended
but not yet effective and not yet adopted. The Manager
does not expect the adoption of these standards
or amendments to have a significant impact to the
Portfolio’s financial statements.
In July 2014, the IASB issued the most recent version
of IFRS 9 Financial Instruments, which addresses
classification and measurement, impairment and hedge
accounting.
The new standard requires assets to be carried at
amortised cost, fair value through profit and loss or fair
value through
comprehensive income based on the entity’s business
model for managing financial assets and the contractual
cash flow characteristics of the financial asset. The
classification and measurement of liabilities remains
generally unchanged with the exception of liabilities
recorded at fair value through profit and loss. For these
liabilities, fair value changes attributable to changes in
the entity’s own credit risk are to be presented in other
comprehensive income unless they affect amounts
recorded in income.
The new standard also addresses impairment of
financial assets. It also introduced a new hedge
accounting model that expands the scope of eligible
hedged items and risks eligible for hedge accounting,
and aligns hedge accounting more closely with risk
management.
The new standard is effective for the Portfolio for its
fiscal year beginning January 1, 2018. The Portfolio is
evaluating the impact of this standard on its financial
statements.

4.Critical accounting estimates and judgments
The most significant accounting estimates and
judgments that the Portfolio has made in preparing
the financial statements relate to the fair value
measurement and classification of investments.
The Portfolio has established policies and control
procedures that are intended to ensure these judgments
are well controlled, independently reviewed, and
consistently applied from period to period. The
estimates of the value of the Portfolio’s assets and
liabilities are believed to be appropriate as at the
reporting date.

The Portfolio may hold financial instruments that are
not quoted in active markets. Note 3 discusses the
estimates used in determining fair value.
In classifying and measuring financial instruments
held by the Portfolio, the Manager is required to make
significant judgments about whether or not the business
of the Portfolio is to invest on a total return basis for the
purpose of applying the fair value options for financial
assets.

5.Units and unit transactions
The redeemable units of the Portfolio are classified as
liabilities.
The units have no par value and are entitled to
distributions, if any. Upon redemption, a unit is
entitled to a proportionate share of the Portfolio’s
NAV. The Portfolio is required to pay distributions
in an amount not less than the amount necessary to
ensure the Portfolio will not be liable for income taxes.
The Portfolio has no restrictions or specific capital
requirements on the subscriptions and redemptions
of units except as disclosed in Note 8(a). The relevant
movements in redeemable units are shown on the
Statement of Changes in Net Assets Attributable to
Holders of Redeemable Units. In accordance with
its investment objectives and strategies, and the risk
management practices outlined in Note 7, the Portfolio
endeavours to invest the subscriptions received in
appropriate investments, while maintaining sufficient
liquidity to meet redemptions, with such liquidity being
augmented by short-term borrowings or disposal of
investments where necessary.
Redeemable units of the Portfolio are offered for
sale on a continuous basis and may be purchased or
redeemed on any Valuation Date at the NAV per unit of
a particular series. The NAV per unit for the purposes of
subscription or redemption is computed by dividing the
NAV of the Portfolio (that is, the total fair value of the
assets less the liabilities) by the total number of units of
the Portfolio outstanding at such time.

6.Related party transactions
(a) Unitholder servicing, sub-advisory commissions and
other portfolio transaction costs
The Portfolio is provided with certain facilities and
services by affiliates of the Manager. Expenses incurred
in the administration of the Portfolio were paid to BMO
Trust Company (“the Trustee”) and to BMO Asset
Management Inc. (“the Registrar”) and charged to the
Portfolio. These expenses are included in “Unitholder

BMO Harris International Equity Portfolio
(unaudited)

NOTES TO FINANCIAL STATEMENTS (cont’d)
(All amounts in thousands of Canadian dollars, except per unit data)
June 30, 2014
servicing fees” in the Statement of Comprehensive
Income.
The sub-advisors (including affiliates of the Manager,
where applicable) engaged by the Manager provide
investment advice and make investment decisions
for the Portfolio. For these services, the sub-advisors
receive sub-advisory fees that are paid monthly by the
Manager. These expenses are included in “Sub-advisory
fees” in the Statement of Comprehensive Income. Any
sub-advisory fees less than or equal to 0.15% of the
net asset value of the Portfolio are absorbed by the
Manager.
The Portfolio may execute trades with and or through
BMO Nesbit Burns Inc., an affiliate of the Manager,
based on established standard brokerage agreements, at
market prices. These fees are included in “Commissions
and other portfolio transaction costs” in the Statement
of Comprehensive Income. Refer to Note 8(d) for related
party fees charged to the Portfolio for the periods ended
June 30, 2014 and June 30, 2013.
(b) Other related party transactions
From time to time, the Manager may on behalf of the
Portfolio enter into transactions or arrangements
with or involving subsidiaries or affiliates of Bank of
Montreal group, or certain other persons or companies
that are related or connected to the Manager of the
Portfolio. These transactions or arrangements may
include transactions or arrangements with or involving
subsidiaries or affiliates of Bank of Montreal, BMO
Trust Company, BMO Nesbitt Burns Inc., Harris
Investment Management Inc., BMO Asset Management
Inc., BMO Investments Inc., Pyrford International
Ltd, Lloyd George Management Inc., F&C Asset
Management plc, or other investment funds offered by
BMO, and may involve the purchase or sale of portfolio
securities through or from a subsidiary or affiliate of
Bank of Montreal, the purchase or sale of securities
issued or guaranteed by a subsidiary or affiliate of
Bank of Montreal, entering into forward contracts with
a subsidiary or affiliate of Bank of Montreal acting as
counterparty, the purchase or redemption of units of
other BMO Harris Private Portfolios or the provision of
services to the Manager.

7.Financial instrument risk
The Portfolio’s activities expose it to a variety of risks
associated with the financial instruments, as follows:
market risk (including currency risk, interest rate risk
and other market risk), credit risk and liquidity risk.
The concentration table groups securities by asset

type, geographic location and/or market segment.
The Portfolio’s risk management practice outlines the
monitoring of compliance to investment guidelines.
The Manager manages the potential effects of
these financial risks on the Portfolio’s performance
by employing and overseeing professional and
experienced portfolio managers that regularly monitor
the Portfolio’s positions, market events and diversify
investment portfolios within the constraints of the
investment guidelines.
(a) Currency risk
Currency risk is the risk that the value of financial
instruments denominated in currencies, other than
the functional currency of the Portfolio, will fluctuate
due to changes in foreign exchange rates. Investments
in foreign markets are exposed to currency risk as the
prices denominated in foreign currencies are converted
to the Portfolio’s functional currency in determining fair
value. The Portfolio may enter into forward currency
contracts for hedging purposes to reduce foreign
currency exposure or to establish exposure to foreign
currencies. The Portfolio’s exposure to currency risk, if
any, is further disclosed in Note 8(e).
(b) Interest rate risk
Interest rate risk is the risk that the fair value of the
Portfolio's interest-bearing investments will fluctuate
due to changes in market interest rates. The Portfolio's
exposure to interest rate risk is concentrated in its
investment in debt securities (such as bonds, money
market instruments, short-term investments and
debentures) and interest rate derivative instruments, if
any. Other assets and liabilities are short-term in nature
and/or non-interest bearing. The Portfolio's exposure
to interest rate risk, if any, is further discussed in Note
8(e).
(c) Other market risk
Other market risk is the risk that the fair value of a
financial instrument will fluctuate as a result of changes
in market prices (other than those arising from interest
rate risk or currency risk), whether those changes are
caused by factors specific to the individual financial
instrument or its issuer, or factors affecting all similar
financial instruments traded in a market or market
segment. Other assets and liabilities are monetary items
that are short-term in nature, and as such they are not
subject to other market risk. The Portfolio's exposure
to other market risk, if any, is further discussed in Note
8(e).

BMO Harris International Equity Portfolio
(unaudited)

NOTES TO FINANCIAL STATEMENTS (cont’d)
(All amounts in thousands of Canadian dollars, except per unit data)
June 30, 2014
(d) Credit risk
Credit risk is the risk that a loss could arise from a
security issuer or counterparty to a financial instrument
not being able to meet its financial obligations. The
fair value of debt securities includes consideration of
the credit worthiness of the debt issuer. Credit risk
exposure for over-the-counter derivative instruments
is based on the Portfolio's unrealized gain of the
contractual obligations with the counterparty as at the
reporting date. The credit exposure of other assets is
represented by its carrying amount. The Portfolio's
exposure to credit risk, if any, is further discussed in
Note 8(e).
The Portfolio may enter into securities lending
transactions with approved counterparties. Credit
risk associated with these transactions is considered
minimal as all counterparties have a sufficient approved
credit rating and the market value of collateral held by
the Portfolio must be at least 102% of the fair value of
securities loaned, as disclosed in Note 8(e).
(e) Liquidity risk
The Portfolio's exposure to liquidity risk is concentrated
in the daily cash redemptions of units. The Portfolio
primarily invests in securities that are traded in active
markets and can be readily disposed. In addition, the
Portfolio retains sufficient cash and cash equivalent
positions to maintain liquidity. The Portfolio may, from
time to time, enter into over-the-counter derivative
contracts or invest in unlisted securities, which are
not traded in an organized market and may be illiquid.
The proportion of illiquid securities to the NAV of
the Portfolio is monitored by the Manager to ensure
it does not exceed the regulatory limit and does not
significantly affect the liquidity required to meet the
Portfolio's financial obligations.

BMO Harris International Equity Portfolio
(unaudited)

NOTES TO FINANCIAL STATEMENTS (cont’d)
(All amounts in thousands of Canadian dollars, except per unit data)
June 30, 2014
8. Portfolio specific information
(a) Portfolio information and change in units
The Portfolio’s inception date was January 28, 1998.
The number of units that have been issued and are
outstanding are disclosed in the table below.
For the periods ended
(in thousands of units)
Units issued and outstanding, beginning
of period

Jun. 30,
2014

Jun. 30,
2013

Total brokerage amounts paid ($)

89,703

63,099

Issued for cash

16,078

13,951

Redeemed during the period
Units issued and outstanding, end of
period

(5,191 )

(8,280 )

100,590

68,770

(b) Increase (decrease) in net assets attributable to holders of redeemable units per unit
The increase (decrease) in net assets attributable to
holders of redeemable units per unit for the periods
ended June 30, 2014 and June 30, 2013 is calculated as
follows:
Jun. 30,
2014

Jun. 30,
2013

Increase in net assets attributable to holders of
redeemable units

37,351

57,025

Weighted average units outstanding during the
period

95,888

65,496

0.39

0.87

Increase in net assets attributable to holders of
redeemable units per unit

(c) Income taxes
As at the tax year-ended December 2013, the Portfolio
had the following capital and non-capital losses for
income tax purposes:
Total Capital Total NonLosses
Capital Losses
($)
($)

Non-Capital Losses That Expire in
2026 and

181,320

—

2014
($)

2015
($)

thereafter
($)

—

—

—

(d) Related party transactions
Unitholder servicing
The related party fees charged for unitholder servicing
fees are as follows:

Unitholder servicing ($)

Jun. 30,
2014

Jun. 30,
2013

149

147

Brokerage commissions and soft dollars
Brokerage commissions paid on securities transactions
and amounts paid to related parties of the Manager for
brokerage services provided to the Portfolio for the
periods are as follows:

Total brokerage amounts paid to related
parties ($)

Jun. 30,
2014

Jun. 30,
2013

643

438

—

—

The Manager may select brokers who charge a
commission in “soft dollars” if they determine in good
faith that the commission is reasonable in relation to the
order execution and research services utilized. There
were no ascertainable soft dollars paid or payable to
dealers by the Portfolio during the periods.
(e) Financial instrument risk
The Portfolio’s objective is to provide a long term
capital appreciation by investing in a diversified
portfolio of primarily equity securities of issuers
throughout the world, other than in Canada and the
United States.
No changes affecting the overall level of risk of
investing in the Portfolio were made during the period.
Currency risk
The tables below summarize the Portfolio’s exposure
to currency risk. Amounts shown are based on the
carrying value of monetary and non-monetary assets
(including derivatives and the underlying principle
(notional) amount of forward currency contracts, if
any).

BMO Harris International Equity Portfolio
(unaudited)

NOTES TO FINANCIAL STATEMENTS (cont’d)
(All amounts in thousands of Canadian dollars, except per unit data)
June 30, 2014
As at Jun. 30, 2014
Cash and
other
current
receivables
& payables
($)

Investments
($)

Forward
currency
contracts
($)

Australian
Dollar

187

59,831

(36,906)

23,112

Chinese
Yuan

269

–

–

269

Danish
Krone

As at Dec. 31, 2013
Cash and
other
current
receivables
& payables
($)

Investments
($)

Forward
currency
contracts
($)

2.0

Australian
Dollar

161

48,624

(26,473)

22,312

2.3

0.0

Brazilian
Real

—

1,462

–

1,462

0.1

Net
As a %
currency of Net
exposure Assets
($)
(%)

Net
As a %
currency of Net
exposure Assets
($)
(%)

—

29,842

–

29,842

2.6

Danish
Krone

—

27,567

–

27,567

2.8

Euro

539

305,520

–

306,059

26.7

Euro

208

265,657

–

265,865

27.0

Hong Kong
Dollar

501

74,957

–

75,458

6.6

Hong Kong
Dollar

59

64,000

–

64,059

6.5

—

5,517

–

5,517

0.5

Israel Shekel

—

4,031

–

4,031

0.4

938

162,032

–

162,970

14.2

Japanese
Yen

(324)

151,474

–

151,150

15.3

1.6

Malaysian
Ringgit

27

15,060

–

15,087

1.5

1.6

Mexican
Peso

—

1,568

–

1,568

0.2

0.4

Norwegian
Krone

—

9,690

–

9,690

1.0

15.8

Philippine
Peso

—

3,695

–

3,695

0.4

1.8

Pound
Sterling

419

144,022

–

144,441

14.7

Singapore
Dollar

—

19,163

–

19,163

1.9

South
Korean
Won

425

4,064

–

4,489

0.5

Swedish
Krona

138

43,476

–

43,614

4.4

—

84,158

–

84,158

8.5
1.0

Israel Shekel
Japanese
Yen
Malaysian
Ringgit
Norwegian
Krone
Philippine
Peso
Pound
Sterling
Singapore
Dollar
Swedish
Krona

41
—
—
453
—

18,510
18,341
4,851
180,893
20,984

–
–
–
–
–

18,551
18,341
4,851
181,346
20,984

—

44,151

–

44,151

3.9

(363)

105,452

–

105,089

9.2

192

11,449

–

11,641

1.0

U.S. Dollar

2,037

33,743

–

35,780

3.1

Total

4,794

1,076,073

(36,906)

1,043,961

91.0

Swiss Franc
Taiwan
Dollar

All amounts in Canadian Dollars

Swiss Franc
Taiwan
Dollar

151

9,215

–

9,366

U.S. Dollar

1,172

35,596

–

36,768

3.7

Total

2,436

932,522

(26,473)

908,485

92.2

All amounts in Canadian Dollars

BMO Harris International Equity Portfolio
(unaudited)

NOTES TO FINANCIAL STATEMENTS (cont’d)
(All amounts in thousands of Canadian dollars, except per unit data)
June 30, 2014
actual results may differ from this sensitivity analysis
and the difference could be material.

As at Jan. 1, 2013
Cash and
other
current
receivables
& payables
($)

Investments
($)

Forward
currency
contracts
($)

Australian
Dollar

60

30,582

(16,656)

13,986

2.5

Brazilian
Real

—

3,169

–

3,169

0.6

Net
As a %
currency of Net
exposure Assets
($)
(%)

Danish
Krone

—

4,890

–

4,890

0.9

Euro

41

145,172

–

145,213

26.2

Hong Kong
Dollar

(17)

44,382

–

44,365

8.0

Indonesia
Rupiah

—

1,508

–

1,508

0.3

Israel Shekel

—

2,626

–

2,626

0.5

Japanese
Yen

31

59,771

–

59,802

10.8

Malaysian
Ringgit

11

7,340

–

7,351

1.3

Mexican
Peso

—

2,111

–

2,111

0.4

Norwegian
Krone

—

6,742

–

6,742

1.2

Philippine
Peso

—

2,619

–

2,619

0.5

Pound
Sterling

551

92,716

–

93,267

16.9

Singapore
Dollar

—

13,699

–

13,699

2.5

South
Korean
Won

56

5,654

–

5,710

1.0

Swedish
Krona

244

18,584

–

18,828

3.4

8

49,438

–

49,446

8.9

Taiwan
Dollar

1,611

5,771

–

7,382

1.3

Thai Baht

—

1,896

–

1,896

0.3

Swiss Franc

U.S. Dollar
Total

286

28,964

–

29,250

5.3

2,882

527,634

(16,656)

513,860

92.8

All amounts in Canadian Dollars

As at the periods ended June 30, 2014, December 31,
2013 and January 1, 2013, if the Canadian dollar had
strengthened or weakened by 5% in relation to all
foreign currencies, with all factors remaining constant,
Net Assets could possibly have increased or decreased,
respectively, by approximately $52,198 (December 31,
2013 – $45,424; January 1, 2013 – $25,693). In practice,

Interest rate risk
As at June 30, 2014, December 31, 2013 and January 1,
2013, the Portfolio did not have any significant exposure
to interest rate risk.
Other market risk
The Portfolio has a significant exposure to other
market risk arising from its investment in equity
securities. The Portfolio's exposure to equity securities
determine the extent to which the Portfolio reacts to the
movements in the relevant Benchmark. Using historical
correlation between the Portfolio's return and the
return of its Benchmark, if the Benchmark, MSCI EAFE
Index (CAD), had increased or decreased by 10%,
with all other variables held constant, the Net Assets
of the Portfolio would have increased or decreased,
respectively, by $81,749 (December 31, 2013 - $70,956;
January 1, 2013 - $40,153). Historical correlation
may not be representative of future correlation,
and accordingly, actual results may differ and the
difference could be material.
Credit risk
As at June 30, 2014, December 31, 2013 and January 1,
2013, the Portfolio did not have any significant exposure
to credit risk.
Securities lending
There were no assets involved in securities lending
transactions as at June 30, 2014, December 31, 2013 and
January 1, 2013.

BMO Harris International Equity Portfolio
(unaudited)

NOTES TO FINANCIAL STATEMENTS (cont’d)
(All amounts in thousands of Canadian dollars, except per unit data)
June 30, 2014
Concentration risk
The following is a summary of the Portfolio's
concentration risk:
Jun. 30,
2014

Dec. 31,
2013

Jan. 1,
2013

Equities
Australia
Austria
Belgium
Brazil
China
Denmark
Finland
France
Germany
Hong Kong
Indonesia
Ireland
Israel
Italy
Japan
Macau
Malaysia
Mexico
Netherlands
New Zealand
Norway
Peru
Philippines
Russia
Singapore
South Korea
Spain
Sweden
Switzerland
Taiwan
Thailand
United Kingdom
United States

5.2%
—%
2.3%
0.1%
1.8%
2.6%
1.0%
9.2%
6.7%
4.7%
—%
0.8%
0.5%
1.7%
14.2%
0.5%
1.6%
—%
4.3%
—%
1.6%
—%
0.4%
—%
1.8%
—%
2.0%
3.9%
9.2%
1.6%
—%
15.3%
1.0%

4.9%
0.6%
1.8%
0.6%
2.4%
2.8%
0.6%
9.1%
7.7%
5.0%
—%
0.8%
0.4%
2.7%
15.4%
0.1%
1.5%
0.2%
2.3%
0.0%
1.0%
—%
0.4%
0.4%
1.9%
0.4%
1.2%
4.4%
8.5%
1.2%
—%
15.3%
1.1%

5.3%
—%
1.6%
1.2%
2.9%
0.9%
0.6%
7.9%
11.5%
5.9%
0.3%
1.4%
1.4%
0.9%
10.8%
—%
1.3%
0.4%
2.3%
0.2%
1.2%
0.4%
0.5%
0.2%
2.5%
1.0%
0.4%
3.4%
8.9%
1.0%
0.3%
17.9%
0.8%

Other Assets Less
Liabilities

6.0%

5.3%

4.7%

100.0%

100.0%

100.0%

(f) Financial assets and financial liabilities
Categories of financial assets and financial liabilities
The table below shows the categories of financial
assets and financial liabilities.
Jun. 30,
2014
Financial assets designated
at FVTPL
Financial assets designated as
held for trading

Dec. 31,
2013

Jan. 1,
2013

1,076,073

932,533

527,636

—

261

—

4,644

3,341

1,391

295

—

311

7,487

2,515

1,460

Loans and receivables
Financial liabilities designated
as held for trading
Financial liabilities measured
at amortized cost

Net gains and losses on financial assets and financial
liabilities at fair value
Jun. 30,
2014

Jun. 30,
2013

52,253

35,283

52,253

35,283

(1,756)

(852)

(1,756)

(852)

50,497

34,431

Net realized gains on financial assets
at FVTPL
Designated at FVTPL

Net realized losses on financial
liabilities at FVTPL
Held for trading

Total net realized gains on financial
assets and financial liabilities at
FVTPL
Change in unrealized gains (losses) on
financial assets at FVTPL
Held for trading
Designated at FVTPL

—

2,205

(5,814)

24,269

(5,814)

26,474

(556)

—

(556)

—

(6,370)

26,474

Change in unrealized losses on financial
liabilities at FVTPL
Held for trading

Total change in unrealized gains
(losses) on financial assets and
financial liabilities at FVTPL

BMO Harris International Equity Portfolio
(unaudited)

NOTES TO FINANCIAL STATEMENTS (cont’d)
(All amounts in thousands of Canadian dollars, except per unit data)
June 30, 2014
(g) Fair value hierarchy
The Portfolio classifies its financial instruments
into three levels based on the inputs used to value
the financial instruments. Level 1 securities are
valued based on quoted prices in active markets for
identical securities. Level 2 securities are valued
based on significant observable market inputs, such
as quoted prices from similar securities and quoted
prices in inactive markets or based on observable
inputs to models. Level 3 securities are valued
based on significant unobservable inputs that reflect
the Manager's determination of assumptions that
market participants might reasonably use in valuing
the securities. The tables below show the relevant
disclosure.
As at Jun. 30, 2014
Financial assets
Equity Securities
Financial liabilities
Derivatives

Level 1 Level 2
20,504 1,055,569

Level 3
Total
— 1,076,073

—

(295)

—

(295)

As at Dec. 31, 2013
Financial assets
Equity Securities
Derivatives
Total

Level 1
23,280
—
23,280

Level 2
909,253
261
909,514

Level 3
—
—
—

Total
932,533
261
932,794

As at Jan. 1, 2013
Financial assets
Equity Securities

Level 1
14,945

Level 2
512,691

Level 3
—

Total
527,636

—

(311)

—

(311)

Financial liabilities
Derivatives

Transfers between levels
There were no transfers between levels during the
periods.
(h) Transition to IFRS
The differences between the Portfolio’s Canadian GAAP
accounting policies and IFRS requirements resulted
in measurement and classification differences on
transition to IFRS. The net impact of these differences
was recorded in opening Net Assets as of January 1,
2013.
The following information reflects the Portfolio’s
transition elections under IFRS 1, First-time Adoption of
International Financial Reporting Standards (“IFRS 1”),
the standard for first-time adoption and the significant

accounting changes resulting from our adoption of
IFRS. The general principle under IFRS 1 is retroactive
application, such that the Portfolio’s Statement of
Financial Position as at January 1, 2013 was restated
as though the Portfolio has always applied IFRS with
the net impact shown as an adjustment to opening Net
Assets.
Transition elections
The fund had applied the voluntary exemption upon
transition to designate financial assets or financial
liabilities at FVTPL. All financial assets designated at
FVTPL upon transition were previously recorded at fair
value under Canadian GAAP as required by Accounting
Guideline 18, Investment Companies.
Statement of cash flows
Under Canadian GAAP, the Portfolio was exempt
from providing a Statement of Cash Flows. IAS 1,
Presentation of Financial Statements (“IAS 1”), requires
that a Statement of Cash Flows to be presented as part
of a complete set of financial statements. As such, the
Portfolio has presented a Statement of Cash Flows in the
interim financial statements for the periods ended June
30, 2014 andJune 30, 2013.
Classification of redeemable units issued by the Portfolio
Under Canadian GAAP, redeemable units of the
Portfolio were presented as Net Assets. IAS 32,
Financial Instruments: Disclosure and Presentation
(“IAS 32”), however, requires an assessment to
determine whether the units issued to unitholders
are puttable instruments that qualify for equity
classification. The Portfolio’s units do not meet the
criteria in IAS 32 for equity classification and therefore,
have reclassified as financial liabilities on transition
to IFRS and presented on the Statement of Financial
Position as Net Assets.
Revaluation of investments at FVTPL
Canadian GAAP required the use of bid prices for
long positions and ask prices for short positions in
determining fair valuation of investments traded in
an active market, rather than the use of close prices
used for the purpose of determining NAV. IFRS 13,
Fair Value Measurement (“IFRS 13”), requires that if
an asset or a liability has a bid price and an ask price,
then its fair value is to be based on a price within
the bid-ask spread that is most representative of fair
value. The standard also allows the use of mid-market
pricing or other pricing conventions that are used by
market participants as a practical expedient for fair

BMO Harris International Equity Portfolio
(unaudited)

NOTES TO FINANCIAL STATEMENTS (cont’d)
(All amounts in thousands of Canadian dollars, except per unit data)
June 30, 2014
value measurements within a bid-ask spread. Upon
adoption of IFRS, the fund has determined that for
traded securities, close prices on the reporting date
are considered to be fair value, if they fall within the
bid-ask spread. See Note 3 for the Portfolio’s fair value
measurement policy.
Reconciliation of Net Assets as reported under Canadian GAAP
to IFRS
Dec. 31,
2013

Jun. 30,
2013

Jan. 1,
2013

Net assets representing
unitholders' equity under
Canadian GAAP

984,736

663,943

553,416

Revaluation of investments
at FVTPL

10

30

2

984,746

663,973

553,418

Net assets attributable to
holders of redeemable units

Reconciliation of increase (decrease) in net assets reported
under Canadian GAAP to IFRS

Increase in net assets from operations under
Canadian GAAP
Revaluation of investments at FVTPL
Increase in net assets attributable to holders of
redeemable units

Dec. 31,
2013

Jun. 30,
2013

177,245

56,997

8

28

177,253

57,025

Manager
BMO Harris Investment
Management Inc.
1 First Canadian Place
100 King St. W., 41st Floor
Toronto, Ontario M5X 1H3

Trustee
BMO Trust Company
1 First Canadian Place
100 King St. W., 41st Floor
Toronto, Ontario M5X 1H3

Independent Auditors
PricewaterhouseCoopers LLP
PwC Tower
18 York Street, Suite 2600
Toronto, Ontario M5J 0B2

”BMO (M-bar roundel symbol) Harris Private Banking” is a registered trade-mark of Bank of Montreal, used under licence. BMO Harris
Private Banking is comprised of Bank of Montreal, BMO Harris Investment Management Inc., and BMO Trust Company. Banking services
are offered through Bank of Montreal. Investment management services are offered through BMO Harris Investment Management Inc.,
an indirect subsidiary of Bank of Montreal. Estate, trust, planning, administration and custodial services are offered through BMO Trust
Company, a wholly owned subsidiary of Bank of Montreal.
®

www.bmoharrisprivatebanking.com



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