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NISM Certifications · NISM-Series-X-A: Investment Adviser (Level 1) · Operational Aspects of Investment Management

A mutual fund scheme has total assets of Rs 520 crore, of which Rs 20 crore is receivable from a stock sold and awaiting settlement and is included in this figure. Its liabilities are Rs 10 crore of accrued expenses and Rs 10 crore of payables to be paid. The scheme has 40 crore units outstanding. What is the NAV per unit?

The NAV per unit is Rs 12.50. Net assets are total assets of Rs 520 crore less liabilities of Rs 20 crore, which is Rs 500 crore, and dividing by 40 crore units gives Rs 12.50. The receivable is already part of assets and is not deducted.

  1. ARs 12.00
  2. BRs 12.50Correct
  3. CRs 12.75
  4. DRs 13.00

Explanation

NAV equals (market value of assets minus liabilities) divided by units outstanding. Assets are Rs 520 crore, which already include the receivable. Liabilities are 10 + 10 = Rs 20 crore. Net assets are 500 crore. Dividing by 40 crore units gives Rs 12.50. Rs 13.00 comes from ignoring the liabilities (520/40). Rs 12.00 results from also subtracting the receivable (480/40).

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