Carnegie fund iii june 2008.xls

CARNEGIE FUND III, SICAV
UNAUDITED SEMI-ANNUAL REPORT
JUNE 30, 2008
Subscriptions are only valid if made on the basis of the current prospectus accompanied by the latest annual and the latest semi-annual report if published after the annual report TABLE OF CONTENTS
Statement of Operations and Changes in Net Assets Statement of Changes in Number of Shares Outstanding Carnegie Fund III - Carnegie WorldWide Long/Short Fund MANAGEMENT AND ADMINISTRATION
Carnegie Fund Management Company S.A.
BOARD OF DIRECTORS
Claes-Johan GEIJERManaging DirectorBanque Carnegie Luxembourg S.A.
Luxembourg Carnegie Fund Management Company S.A.
Bruno FREREJEANCo-Managing DirectorBanque Carnegie Luxembourg S.A.
Luxembourg STATEMENT OF NET ASSETS AS AT JUNE 30, 2008
ASSETS
Securities portfolio at market value (Note 2.1)
OTHER ASSETS
Unrealised gain on financial futures (Note 5)
LIABILITIES
Redemptions payable
Unrealised loss on contractsfor differences (note 6) Investment management fee payable (Note 8) NET ASSET VALUE
NET ASSET VALUE PER SHARE AS AT JUNE 30, 2008
The accompanying notes form an integral part of these financial statements STATEMENT OF OPERATIONS AND CHANGES IN NET ASSETS
FOR THE PERIOD ENDED JUNE 30, 2008
INCOME
Dividends, net (Note 2.5)
Total Income
EXPENSES
Investment management fee (Note 8)
Total Expenses
Net realised loss on contracts for differences Variation in net unrealised appreciationon investments Variation in net unrealised profit/(loss)on financial futures Variation in net unrealised losson contracts for differences Decrease in net assets as a result of operations Net assets at the beginning of the period NET ASSETS AT THE END OF THE PERIOD
The accompanying notes form an integral part of these financial statements STATEMENT OF CHANGES IN NUMBER OF SHARES OUTSTANDING
FOR THE PERIOD ENDED JUNE 30, 2008
The accompanying notes form an integral part of these financial statements CARNEGIE FUND III - CARNEGIE WORLDWIDE LONG/SHORT FUND - SECURITIES PORTFOLIO AS AT JUNE 30, 2008
SECURITY DESCRIPTION
Transferable Securities Admitted To An Official Exchange Listing
Shares & Warrants
Pantaloon Retail India Call Warrant 07/08/17 CARNEGIE FUND III - CARNEGIE WORLDWIDE LONG/SHORT FUND - SECURITIES PORTFOLIO AS AT JUNE 30, 2008
SECURITY DESCRIPTION
Transferable Securities Admitted To An Official Exchange Listing (continued)
Shares & Warrants (continued)
TOTAL TRANSFERABLE SECURITIES ADMITTEDTO AN OFFICIAL EXCHANGE LISTING Transferable Securities Dealt In On Another Regulated Market
Shares & Warrants
TOTAL TRANSFERABLE SECURITIES DEALTIN ON ANOTHER REGULATED MARKET CARNEGIE FUND III - CARNEGIE WORLDWIDE LONG/SHORT FUND - SECURITIES PORTFOLIO AS AT JUNE 30, 2008
SECURITY DESCRIPTION
Other Transferable Securities
Shares & Warrants
Housing Development Finance Corp (clone note) 20/05/10 Short Sales of Transferable Securities Admitted To An Official Exchange Listing
Short Sales of Shares & Warrants
TOTAL SHORT SALES OF SHARES & WARRANTS TOTAL SHORT SALES OF TRANSFERABLE SECURITIESADMITTED TO AN OFFICIAL EXCHANGE LISTING TOTAL SHORT SALES OF TRANSFERABLE SECURITIES CARNEGIE FUND III - CARNEGIE WORLDWIDE LONG/SHORT FUND - INDUSTRY SECTOR ANALYSIS AS AT JUNE 30, 2008
SECTOR DESCRIPTION
A statement of changes in the composition of the portfolio is available to Shareholders free of charge on request from the Fund's registered office NOTES TO THE FINANCIAL STATEMENTS
1 GENERAL
1 GENERAL
CARNEGIE FUND III, SICAV was incorporated as a “Société Anonyme” qualifying as a “Société Transferable Securities. It is established for an undetermined duration from the date of incorporation. The Company presently contains two Sub-Funds: The Company presently has two Sub-Funds: Carnegie Medical Hedge which has not yet been opened for subscription. 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
NsI FICANT ACCOUNTING POLICIES
nts ock exchange or an over-the-counter market are valued at the latest available price. Where such prices are not representative of the fair value of the relevant securities and in the case of un unquoted securities, the value used is their respective reasonably foreseeable sales price as determined prudently and in good faith in accordance with generally accepted valuation principles. Short sales of securities are disclosed as negative amounts and valued marked to market in the securities d as negative amounts and valued marked to market in the securities Profits and losses on sales of investments have been determined on the basis of average cost. 2.3 Realised profit and loss on investments 2.4 Foreign exchange Profits and losses on sales of investments have been determined on the basis of average cost. The combined financial statements of the Fund are maintained in EUR. The combined financial sta ange e sum of the Sub-Funds’ financial statements equivalent in EUR translated, where applicable, at the rate of exchange ruling at December 31, 2005. The combined financial statements of the Fund are maintained in EUR. The combined financial The market value of the investments and other assets and liabilities expressed in currencies other than statements are the sum of the Sub-Funds’ financial statements equivalent in EUR translated, where the base currency of the Sub-Fund have been converted at the rates of exchange ruling at applicable, at the rate of exchange ruling as at June 30, 2008. December 31, 2005. The cost of investments in currencies other than the base currency of the Sub-Fund is converted at the rates of exchange prevailing at each Net Asset Value calculation date. Profits and loss base currency of the Sub-Fund have been converted at the rates of exchange ruling as at June 30, 2008. ts i n currencies other than the base currency of the Sub-Fund is converted at the rates of exchange prevailing at each Net Asset Value calculation date. Profits and losses arising from information thereon is reasonably available to the Sub-Funds. Interest on bonds is accrued on a daily basis. Dividends are recognised as income (or expense in the case of short sales of securities) on the date securities are first quoted ex-dividend, to the extent information thereon is reasonably available to the Sub-Funds. Interest on bonds is accrued on a daily basis. NOTES TO THE FINANCIAL STATEMENTS
EXCHANGE RATES AS AT JUNE 30, 2008
The Company is registered under the Luxembourg law as an investment company (Société d’Investissement à Capital Variable “SICAV”). Accordingly, no Luxembourg income or capital gains tax is, at present, payable. It is subject, however, to an annual “taxe d’abonnement” calculated at the annual rate of 0.05% of the net asset value of the Company at the end of each quarter. This tax is payable quarterly. FINANCIAL FUTURES
As at June 30, 2008, Carnegie WorldWide Long/Short Fund had entered into the following outstanding
6 CONTRACTS
DIFFERENCES
As at June 30, 2008, Carnegie WorldWide Long/Short Fund had entered into the following outstanding NOTES TO THE FINANCIAL STATEMENTS

7 SECURITIES BORROWINGS

As at June 30, 2008, Carnegie WorldWide Long/Short Fund had borrowed the following shares:
8 INVESTMENT MANAGEMENT FEE
In consideration for its services, the Investment Advisor and Investment Manager shall be paid a management fee of up to 1.0% per annum of the Net Asset Value of all the Company's Sub Funds, calculated monthly and paid on a monthly basis.
9 PERFORMANCE
The Company pays the Investment Advisor and Investment Manager a performance fee (the “Performance Fee”). The Performance Fee will accrue daily and will be due from the relevant Sub Fund’s assets to the Investment Managers as of the end of each Fiscal Year or Calendar Quarter in the case of Carnegie Worldwide Long/Short Fund. The Performance Fee for any Fiscal Year or Calendar Quarter is an amount equal to 20% of the net realised and unrealised appreciation, if any, in the Net Asset Value of the shares (adjusted for the sale and redemption of shares) during each Fiscal Year or Calendar Quarter of the relevant Sub Fund, but only in the event the relevant Sub Fund’s Net Asset Value has increased for that Fiscal Year or Calendar Quarter and cumulatively since the issuance of the shares above a hurdle rate. The hurdle rate is defined as the EURIBOR 3 month average rate capped at 8.0%, meaning that the hurdle rate never can exceed 8.00% for any given time period it is calculated. The hurdle is calculated after taking into account the annual Management Fee and is pro rated for a partial year. If a share has a Net Loss allocable to it during any Fiscal Year or Calendar Quarter and during a subsequent Fiscal Year or Calendar Quarter there is a Net Profit allocable to the share there will be no Performance Fee payable with respect to the share until the amount of the Net Loss previously allocated to the share has been recouped. The performance fee mechanism is described in detail in the Carnegie Fund III, SICAV Prospectus.

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