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Share Name | Share Symbol | Market | Type |
---|---|---|---|
LandBridge Company LLC | NYSE:LB | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
-2.46 | -7.89% | 28.70 | 32.09 | 28.019 | 31.16 | 358,473 | 19:45:59 |
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.
20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF
REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number
811-10401
Trust for Professional
Managers
(Exact name of registrant as
specified in charter)
615 East Michigan
Street
Milwaukee, WI 53202
(Address of
principal executive offices) (Zip code)
Rachel A. Spearo
U.S. Bancorp
Fund Services, LLC
615 East Michigan
Street
Milwaukee, WI 53202
(Name and
address of agent for service)
(414) 765-5384
Registrant's telephone number, including area
code
Date of fiscal year end: May 31, 2013
Date of reporting period:
May 31, 2013
Item 1. Reports to Stockholders.
Letter from the Investment Adviser
Dear Fellow
Shareholders,
The Jensen Quality Value
Fund Class J Shares returned 29.76% for the year ended May 31, 2013,
compared to a return of 32.60% for the Russell 3000 Value Index (the Index).
Please see pages 3 through 4 of this report for complete standardized
performance information for the Fund.
Market Perspective
During the twelve months ended May 31, 2013, U.S. equity
markets rose steadily, with the Index producing a positive return in ten of the
twelve months. Improvements in manufacturing, housing, unemployment and other
economic indicators in the U.S. drove markets higher.
Although the U.S. fiscal cliff problem has not
disappeared (there are still ongoing reductions in government spending), its
impact at the beginning of the year was smaller than many investors
anticipated.
In addition,
the U.S. Federal Reserve continued its expansionary monetary policy through its
quantitative easing program.
Other policy makers around the world continued or began monetary
expansion programs, most notably in Japan, further easing fears of renewed
recessions.
In keeping with the Funds principal investment strategies, stock selection was determined by the Jensen Quality Value investment process which utilizes a multi-factor model based on business fundamentals. For the twelve months ended May 31, 2013, the Funds performance relative to the benchmark was aided by an underweight in Utility and Energy companies and an overweight in Consumer Discretionary companies. Specific companies within the Information Technology, Consumer Staples, and Industrials sectors also helped boost performance.
The funds underweight in the Financial sector and overweight in the Consumer Staples sector, relative to the benchmark, detracted from the portfolios performance. At the company level, the Funds performance was most negatively impacted by specific companies within the Consumer Discretionary sector, as well as specific companies in the Health Care and Utilities sectors. As of May 31, 2013, there were 69 companies held in the Jensen Quality Value Fund.
The top contributor to fund performance for the twelve months ended May 31, 2013 was Western Digital Corp. , a manufacturer of data collection, storage, and management hardware including hard drives and networking products. During the twelve month period, Western Digitals stock price increased as the company reported better than expected earnings and revenue growth. Western Digital was selected for the Jensen Quality Value Fund because of its compelling valuation at the time of purchase. Other notable companies that contributed positively to portfolio performance were Eaton Vance Corp. , J2 Global Inc. , and Best Buy Co., Inc.
Three of the four most negative contributors to fund performance for the twelve months ended May 31, 2013 were companies in the for-profit education industry Strayer Education, Inc. , ITT Educational Services, Inc. , and Apollo Group, Inc. This industry, which provides post-secondary education, including associates, bachelor, and master degrees, was under considerable pressure during the twelve month period. The three companies faced ongoing challenges from U.S. government regulators, as well as declining enrollments from the peaks during the U.S. recession. Despite these companies valuations at the time of purchase, their stocks continued to languish as investors awaited clarity on regulatory issues and enrollment improvement.
The Jensen Quality Value Funds
Strategy
The Jensen Quality Value
discipline was created to capture a subset of Jensens universe of high quality
companies typically not included in the Jensen Quality Growth strategy. The
Value strategy was created when Jensen undertook a 2006 study to better
understand our universe of qualifying companies, how each stock had historically
performed over long periods, and how we might improve the firms existing
investment process. In addition to instituting enhancements for managing our
flagship Quality Growth strategy, we found that an investment strategy could be
created whose goal was to capture the benefits of quality companies with more
traditional value characteristics.
Annual Report | Jensen Quality Value Fund | 1 |
We believe that the Jensen Quality Value strategy offers a distinctive value exposure. As the advisor to both the Jensen Quality Growth Fund and the Jensen Quality Value Fund, we select companies from the same universe of high Return on Equity companies. The traditional definitions of growth and value investing deliver divergent groups of stocks, judged by such measures as price-to-earnings, price-to-book value and earnings growth. The emphasis on seeking quality companies with the most persistent business performance for the Jensen Quality Growth Fund leads us to mostly large capitalization companies. The primary emphasis on stock valuation for the Jensen Quality Value Fund is expected to result in a mix of small-, medium- and large-capitalization companies with the greatest concentration in mid-caps. In addition, we expect the Value strategys sensitivity to valuation to result in significant portfolio turnover. Nonetheless, the companies in our investment universe must continue to meet a minimum 15% Return on Equity per year, as determined by the Adviser, which we consider a fundamental requirement for profitable business operations and a high-quality company.
We believe the Jensen Quality Value Fund offers important diversification benefits, and that our research into this strategy and years of analyzing our universe of quality, high Return on Equity companies, represents a meaningful competitive advantage. We invite you to find additional information about the Jensen Quality Value Fund at www.jenseninvestment.com.
We appreciate your confidence in Jensen. We remain committed to our investment responsibilities.
Cordially,
The Jensen Investment Committee
This discussion and analysis of the Fund is as of May 31, 2013 and is subject to change, and any forecasts made cannot be guaranteed and should not be considered investment advice. Past performance is no guarantee of future results. Fund holdings and sector weightings are subject to change and are not recommendations to buy or sell any security. For more complete information regarding performance and holdings, please refer to the financial statements and schedule of investments headings of this report. Current and future portfolio holdings are subject to risk. Mutual fund investing involves risk, and principal loss is possible. The Fund invests in mid- and smaller capitalization companies, which involve additional risks such as limited liquidity and greater volatility. Diversification does not assure a profit or protect against loss in a declining market. The Russell 3000 Value Index measures the performance of those Russell 3000 Index companies with lower price-to-book ratios and lower forecasted growth values. The Index is unmanaged, and one cannot invest directly in the Index. RETURN ON EQUITY: Is equal to a companys after-tax earnings (excluding non-recurring items) divided by its average stockholder equity for the year. EARNINGS PER SHARE GROWTH (EPS GROWTH) is the year-over-year percent change in a companys earnings per share. PRICE/BOOK (P/B) RATIO is calculated by dividing the current price of the stock by the companys book value per share. PRICE/EARNINGS (P/E) RATIO is a measure that compares the price of a stock to the earnings of the underlying company. The trailing P/E ratio is calculated by dividing current price of the stock by the companys past year earnings per share. The leading (forward) P/E ratio is calculated by dividing current price of the stock by the companys predicted future year earnings per share, as determined by market consensus. Must be preceded or accompanied by a prospectus for the Jensen Quality Value Fund. To obtain a prospectus for the Jensen Quality Growth Fund, call 1.800.992.4144 or visit www.jenseninvestment.com. The funds investment objectives, risks, fees and expenses, must be considered carefully before investing. The prospectus contains this and other important information about the investment company. Please read it carefully before investing. The Quality Growth Fund is non-diversified, meaning that it may concentrate its assets in fewer individual holdings than a diversified fund and is therefore more exposed to individual stock volatility than a diversified fund. The Jensen Funds are distributed by Quasar Distributors, LLC. |
2 | Jensen Quality Value Fund | Annual Report |
Jensen Quality Value Fund - Class J (Unaudited)
Total Returns vs. Russell 3000 Value Index
Average Annual Total Returns For periods ended May 31, 2013 | 1 year | 3 years | Since Inception (3/31/2010) | ||||||
Jensen Quality Value Fund - Class J | 29.76% | 13.72% | 10.54% | ||||||
Russell 3000 Value Index | 32.60% | 16.37% | 13.39% |
Investment performance reflects fee waivers in effect. In the absence of such waivers, total returns would be reduced.
Performance data shown represents past performance. Past performance does not guarantee future results. The investment return and principal value of an investment will fluctuate so that an investors shares, when redeemed, may be worth more or less than their original cost. Current performance of the fund may be lower or higher than the performance shown. Performance data current to the most recent month-end may be obtained by calling 800-992-4144 or by visiting www.jenseninvestment.com.
Annual Report | Jensen Quality Value Fund | 3 |
Jensen Quality Value Fund - Class I (Unaudited)
Total Returns vs. Russell 3000 Value Index
Average Annual Total Returns For periods ended May 31, 2013 | 1 year | 3 years | Since Inception (3/31/2010) | ||||||
Jensen Quality Value Fund - Class I | 29.91% | 13.88% | 10.73% | ||||||
Russell 3000 Value Index | 32.60% | 16.37% | 13.39% |
Investment performance reflects fee waivers in effect. In the absence of such waivers, total returns would be reduced.
Performance data shown represents past performance. Past performance does not guarantee future results. The investment return and principal value of an investment will fluctuate so that an investors shares, when redeemed, may be worth more or less than their original cost. Current performance of the fund may be lower or higher than the performance shown. Performance data current to the most recent month-end may be obtained by calling 800-992-4144 or by visiting www.jenseninvestment.com.
4 | Jensen Quality Value Fund | Annual Report |
Investments by Sector as of May 31,
2013
(as a Percentage of Total Investments)
(Unaudited)
Annual Report | Jensen Quality Value Fund | 5 |
Statement of Assets &
Liabilities
May 31, 2013
Assets: | ||
Investments, at value (cost $18,017,229) | $20,438,987 | |
Cash | 743 | |
Income receivable | 39,932 | |
Receivable for capital stock issued | 10,007 | |
Receivable from Investment Adviser | 1,260 | |
Other Assets | 14,429 | |
Total Assets | 20,505,358 | |
Liabilities: | ||
Payable for 12b-1 fees - Class J | 945 | |
Payable for investments purchased | 101,357 | |
Payable to affiliates | 28,296 | |
Accrued expenses and other liabilities | 29,441 | |
Total Liabilities | 160,039 | |
Net Assets | $20,345,319 | |
Net Assets Consist of: | ||
Capital stock | $16,945,323 | |
Accumulated undistributed net investment income | 29,068 | |
Accumulated net realized gain | 949,170 | |
Unrealized appreciation on investments | 2,421,758 | |
Total Net Assets | $20,345,319 | |
Net Assets Consist of: | ||
Class J Shares: | ||
Net Assets | $14,871,980 | |
Shares of beneficial interest outstanding | 1,197,297 | |
Net Asset Value, Offering Price and Redemption Price Per Share (unlimited number of shares authorized, $.001 par value) | $12.42 | |
Class I Shares: | ||
Net Assets | $5,473,339 | |
Shares of beneficial interest outstanding | 440,719 | |
Net Asset Value, Offering Price and Redemption Price Per Share (unlimited number of shares authorized, $.001 par value) | $12.42 |
The accompanying notes are an integral part of these financial statements
6 | Jensen Quality Value Fund | Annual Report |
Schedule of Investments
May 31, 2013
Common Stocks - 99.25%
shares | Aerospace & Defense - 6.80% | value | |
4,590 | Alliant Techsystems, Inc. | $360,406 | |
4,460 | General Dynamics Corp. | $343,866 | |
3,260 | Lockheed Martin Corp. | $345,005 | |
5,170 | Rockwell Collins, Inc. | $334,758 | |
$1,384,035 | |||
shares | Air Freight & Logistics - 1.21% | value | |
4,340 | CH Robinson Worldwide, Inc. | $246,035 | |
shares | Capital Markets - 3.71% | value | |
14,660 | Federated Investors, Inc. | $405,642 | |
7,610 | Waddell & Reed Financial, Inc. | $350,364 | |
$756,006 | |||
shares | Commercial Services & Supplies - 3.19% | value | |
8,710 | Deluxe Corp. | $325,754 | |
21,960 | Pitney Bowes, Inc. | $322,373 | |
$648,127 | |||
shares | Communications Equipment - 1.92% | value | |
16,230 | Cisco Systems, Inc. | $390,818 | |
shares | Computers & Peripherals - 5.08% | value | |
24,920 | Dell, Inc. | $332,682 | |
11,180 | Lexmark International, Inc. | $341,102 | |
5,680 | Western Digital Corp. | $359,657 | |
$1,033,441 | |||
shares | Consumer Finance - 1.62% | value | |
3,560 | World Acceptance Corp. (a) | $328,802 | |
shares | Containers & Packaging - 2.41% | value | |
7,240 | Ball Corp. | $312,478 | |
3,800 | Silgan Holdings, Inc. | $177,726 | |
$490,204 | |||
shares | Diversified Consumer Services - 0.52% | value | |
2,290 | Weight Watchers International, Inc. | $104,997 | |
shares | Diversified Financial Services - 3.37% | value | |
6,110 | McGraw-Hill Financial, Inc. | $333,301 | |
5,290 | Moodys Corp. | $351,467 | |
$684,768 | |||
shares | Electrical Equipment - 1.67% | value | |
5,930 | Emerson Electric Company | $340,738 | |
Electronic Equipment & | |||
shares | Instruments - 1.78% | value | |
10,330 | Dolby Laboratories, Inc. | $361,550 | |
shares | Food & Staples Retailing - 4.82% | value | |
9,550 | Kroger Co. | $321,549 | |
9,990 | Sysco Corp. | $337,661 | |
4,280 | Wal-mart Stores, Inc. | $320,315 | |
$979,525 | |||
shares | Food Products - 1.51% | value | |
7,180 | Campbell Soup Co. | $307,376 | |
shares | Health Care Equipment & Supplies - 10.14% | value | |
9,290 | Abbott Laboratories | $340,664 | |
3,300 | CR Bard, Inc. | $340,197 | |
6,950 | Medtronic, Inc. | $354,521 | |
7,880 | St Jude Medical, Inc. | $340,652 | |
5,150 | Stryker Corp. | $341,909 | |
4,420 | Zimmer Holdings, Inc. | $347,014 | |
$2,064,957 |
The accompanying notes are an integral part of these financial statements
Annual Report | Jensen Quality Value Fund | 7 |
Schedule of Investments continued
shares | Health Care Providers & Services - 7.77% | value | |
4,940 | Cigna Corp. | $335,426 | |
3,640 | Laboratory Corporation of America Holdings (a) | $362,144 | |
4,600 | Patterson Companies, Inc. | $179,768 | |
5,860 | Quest Diagnostics, Inc. | $362,382 | |
5,440 | UnitedHealth Group, Inc. | $340,707 | |
$1,580,427 | |||
shares | Health Care Technology - 1.59% | value | |
18,140 | Quality Systems, Inc. | $324,343 | |
shares | Hotels, Restaurants & Leisure - 0.46% | value | |
2,390 | Brinker International, Inc. | $93,712 | |
shares | Household Durables - 3.64% | value | |
9,390 | Garmin Ltd. (b) | $327,993 | |
7,460 | Tempur-Pedic International, Inc. (a) | $315,409 | |
1,190 | Tupperware Brands Corp. | $96,366 | |
$739,768 | |||
shares | Household Products - 1.54% | value | |
3,280 | Energizer Holdings, Inc. | $313,929 | |
shares | IT Services - 2.15% | value | |
7,110 | Global Payments, Inc. | $340,996 | |
460 | International Business Machines Corp. | $95,689 | |
$436,685 | |||
shares | Machinery - 3.13% | value | |
3,720 | Caterpillar, Inc. | $319,177 | |
3,640 | Deere & Co. | $317,080 | |
$636,257 | |||
shares | Media - 2.60% | value | |
2,370 | Dish Network Corp. | $91,340 | |
2,510 | John Wiley & Sons, Inc. | $99,647 | |
5,430 | Omnicom Group, Inc. | $337,366 | |
$528,353 | |||
shares | Multiline Retail - 3.10% | value | |
1,950 | Dollar Tree, Inc. (a) | $93,678 | |
1,590 | Family Dollar Stores, Inc. | $97,229 | |
5,730 | Nordstrom, Inc. | $337,038 | |
1,490 | Target Corp. | $103,555 | |
$631,500 | |||
shares | Oil, Gas & Consumable Fuels - 3.53% | value | |
3,720 | Exxon Mobil Corp. | $336,548 | |
16,750 | Ultra Petroleum Corp. (a)(b) | $381,565 | |
$718,113 | |||
shares | Personal Products - 3.41% | value | |
14,300 | Avon Products, Inc. | $337,051 | |
6,070 | Nu Skin Enterprises, Inc. | $356,916 | |
$693,967 | |||
shares | Pharmaceuticals - 3.15% | value | |
8,960 | Endo Health Solutions, Inc. (a) | $325,248 | |
11,570 | Pfizer, Inc. | $315,051 | |
$640,299 | |||
shares | Professional Services - 1.76% | value | |
3,640 | Dun & Bradstreet Corp. | $357,230 | |
shares | Software - 3.39% | value | |
10,150 | Microsoft Corp. | $354,032 | |
9,960 | Oracle Corporation | $336,250 | |
$690,282 | |||
shares | Specialty Retail - 5.01% | value | |
1,820 | Advance Auto Parts, Inc. | $148,366 | |
4,820 | Bed Bath & Beyond, Inc. (a) | $328,965 | |
12,810 | Best Buy, Inc. | $352,915 | |
1,450 | Ross Stores, Inc. | $93,235 | |
1,910 | TJX Companies, Inc. | $96,665 | |
$1,020,146 |
The accompanying notes are an integral part of these financial statements
8 | Jensen Quality Value Fund | Annual Report |
Schedule of Investments continued
shares | Textiles, Apparel & Luxury Goods - 1.65% | value | |
5,770 | Coach, Inc. | $336,160 | |
shares | Tobacco - 1.62% | value | |
9,150 | Altria Group, Inc. | $330,315 | |
Total Common Stocks | value | ||
(Cost $17,771,107) | $20,192,865 | ||
Short-Term Investments - 1.21% | |||
shares | value | ||
246,122 | Fidelity Institutional Money Market Funds - | ||
Government Portfolio Class I, 0.010% (c) | $246,122 | ||
Total Short-Term Investments | value | ||
(Cost $246,122) | $246,122 | ||
Total Investments | value | ||
(Cost $18,017,229) - 100.46% | $20,438,987 | ||
Liabilities in Excess of Other Assets - (0.46)% | ($93,668) | ||
TOTAL NET ASSETS - 100.00% | $20,345,319 |
Percentages are stated as a percent of net assets. |
|
(a) | Non-income producing security. |
(b) | Foreign issued security. |
(c) | Variable rate security; the rate shown represents the rate at May 31, 2013. |
The Schedule of Investments incorporates the Global Industry Classification Standard (GICS ® ). GICS was developed by and/or is the exclusive property of MSCI, Inc. (MSCI) and Standard & Poors Financial Services LLC (S&P). GICS is a service mark of MSCI and S&P and has been licensed for use by U.S. Bancorp Fund Services, LLC.
The accompanying notes are an integral part of these financial statements
Annual Report | Jensen Quality Value Fund | 9 |
Statement of Operations
For the Year Ended May 31, 2013
Investment Income: | |
Dividend income | $420,935 |
Interest income | 18 |
420,953 | |
Expenses: | |
Investment advisory fees | 125,325 |
Federal and state registration fees | 33,872 |
12b-1 - Class J | 30,360 |
Administration fees | 29,179 |
Audit and tax fees | 16,486 |
Reports to shareholders | 15,746 |
Fund accounting fees | 15,597 |
Legal fees | 15,491 |
Custody fees | 11,900 |
Transfer agent fees | 9,362 |
Chief Compliance Officer fees and expenses | 7,490 |
Trustees fees and expenses | 6,241 |
Transfer agent expenses | 4,870 |
Shareholder servicing fees - Class I | 913 |
Other | 6,349 |
Total expenses | 329,181 |
Less waivers and reimbursement by Adviser (Note 4) | (127,143) |
Net expenses | 202,038 |
Net Investment Income | 218,915 |
Realized and Unrealized Gain (Loss) on Investments: | |
Net realized gain on investment transactions | 1,320,037 |
Change in unrealized appreciation on investments | 2,963,543 |
Net realized and unrealized gain on investments | 4,283,580 |
Net-Increase in Net Assets Resulting | |
from Operations | $4,502,495 |
Statements of Changes in Net Assets
year ended | year ended | |||||
Operations: | May 31, 2013 | May 31, 2012 | ||||
Net investment income | $218,915 | $157,955 | ||||
Net realized-gain on investment | ||||||
transactions | 1,320,037 | 89,828 | ||||
Change in unrealized appreciation | ||||||
(depreciation) on investments | 2,963,543 | (1,158,974) | ||||
Net increase (decrease) in net assets | ||||||
resulting from operations | 4,502,495 | (911,191) | ||||
year ended | year ended | |||||
Capital Share Transactions: | May 31, 2013 | May 31, 2012 | ||||
Shares Sold - Class J | 1,792,127 | 3,415,479 | ||||
Shares Sold - Class I | 227,419 | 1,917,269 | ||||
Shares issued to holders in | ||||||
reinvestment of dividends - Class J | 287,573 | 686,314 | ||||
Shares issued to holders in | ||||||
reinvestment of dividends - Class I | 118,585 | 270,385 | ||||
Shares redeemed - Class J | (1,250,626) | (919,588) | ||||
Shares redeemed - Class I | (59,240) | (1,054,024) | ||||
Net increase-in net assets from capital | ||||||
share transactions | 1,115,838 | 4,315,835 | ||||
Dividends and Distributions to | year ended | year ended | ||||
Shareholders: | May 31, 2013 | May 31, 2012 | ||||
Net investment income - Class J | (161,412) | (95,089) | ||||
Net investment income - Class I | (70,590) | (42,372) | ||||
Net realized gains - Class J | (126,161) | (591,225) | ||||
Net realized gains - Class I | (47,995) | (228,012) | ||||
Total dividends and distributions | (406,158) | (956,698) | ||||
Increase in Net Assets | 5,212,175 | 2,447,946 | ||||
year ended | year ended | |||||
Net Assets: | May 31, 2013 | May 31, 2012 | ||||
Beginning of year | $15,133,144 | $12,685,198 | ||||
End of year | $20,345,319 | $15,133,144 | ||||
Accumulated Undistributed | ||||||
Net Investment Income | $29,068 | $42,155 |
The accompanying notes are an integral part of these financial statements
10 | Jensen Quality Value Fund | Annual Report |
Financial Highlights
Class J
year ended | year ended | year ended | period ended | |||||||||
Per Share Data: | May 31, 2013 | May 31, 2012 | May 31, 2011 | May 31, 2010 (1) | ||||||||
Net asset value, beginning of period | $9.81 | $11.23 | $9.34 | $10.00 | ||||||||
Income from investment operations: | ||||||||||||
Net investment income (2) | 0.14 | 0.11 | 0.10 | 0.01 | ||||||||
Net realized and unrealized gain (loss) on investments | 2.73 | (0.84) | 1.87 | (0.67) | ||||||||
Total from investment operations | 2.87 | (0.73) | 1.97 | (0.66) | ||||||||
Less distributions: | ||||||||||||
Dividends from net investment income | (0.15) | (0.10) | (0.08) | | ||||||||
Distributions from net realized gain on investments | (0.11) | (0.59) | | | ||||||||
Total distributions | (0.26) | (0.69) | (0.08) | | ||||||||
Net asset value, end of period | $12.42 | $9.81 | $11.23 | $9.34 | ||||||||
Total return (3) | 29.76% | (6.47)% | 21.19% | (6.60)% | ||||||||
Supplemental data and ratios: | ||||||||||||
Net assets, end of year (000s) | $14,872 | $11,062 | $9,183 | $3,832 | ||||||||
Ratio of expenses to average net assets | ||||||||||||
Before waivers and reimbursement of expenses (4) | 2.03% | 2.08% | 2.78% | 9.16% | ||||||||
After waivers and reimbursement of expenses (4) | 1.25% | 1.25% | 1.25% | 1.25% | ||||||||
Ratio of net investment income (loss) to average net assets | ||||||||||||
Before waivers and reimbursements of expenses (4) | 0.48% | 0.23% | (0.59)% | (7.16)% | ||||||||
After waivers and reimbursements of expenses (4) | 1.26% | 1.06% | 0.94% | 0.75% | ||||||||
Portfolio turnover rate | 121.35% | 116.74% | 120.51% | 97.77% |
(1) | The Fund commenced operations on March 31, 2010. |
(2) | Per share amounts are calculated using the average shares outstanding method. |
(3) | Not annualized for periods less than one year. |
(4) | Annualized for periods less than one year. |
The accompanying notes are an integral part of these financial statements
Annual Report | Jensen Quality Value Fund | 11 |
Financial Highlights
Class I
year ended | year ended | year ended | period ended | |||||||||
Per Share Data: | May 31, 2013 | May 31, 2012 | May 31, 2011 | May 31, 2010 (1) | ||||||||
Net asset value, beginning of period | $9.82 | $11.24 | $9.35 | $10.00 | ||||||||
Income from investment operations: | ||||||||||||
Net investment income (2) | 0.15 | 0.12 | 0.11 | 0.01 | ||||||||
Net realized and unrealized gain (loss) on investments | 2.73 | (0.84) | 1.87 | (0.66) | ||||||||
Total from investment operations | 2.88 | (0.72) | 1.98 | (0.65) | ||||||||
Less distributions: | ||||||||||||
Dividends from net investment income | (0.17) | (0.11) | (0.09) | | ||||||||
Distributions from net realized gain on investments | (0.11) | (0.59) | | | ||||||||
Total distributions | (0.28) | (0.71) | (0.09) | | ||||||||
Net asset value, end of period | $12.42 | $9.82 | $11.24 | $9.35 | ||||||||
Total return (3) | 29.91% | (6.30)% | 21.33% | (6.50)% | ||||||||
Supplemental data and ratios: | ||||||||||||
Net assets, end of year (000s) | $5,473 | $4,071 | $3,503 | $1,305 | ||||||||
Ratio of expenses to average net assets | ||||||||||||
Before waivers and reimbursement of expenses (4) | 1.80% | 1.87% | 2.61% | 10.99% | ||||||||
After waivers and reimbursement of expenses (4) | 1.10% | 1.10% | 1.10% | 1.10% | ||||||||
Ratio of net investment income to average net assets | ||||||||||||
Before waivers and reimbursements of expenses (4) | 0.73% | 0.44% | (0.42)% | (9.07)% | ||||||||
After waivers and reimbursements of expenses (4) | 1.43% | 1.21% | 1.09% | 0.82% | ||||||||
Portfolio turnover rate | 121.35% | 116.74% | 120.51% | 97.77% |
(1) | The Fund commenced operations on March 31, 2010. |
(2) | Per share amounts are calculated using the average shares outstanding method. |
(3) | Not annualized for periods less than one year. |
(4) | Annualized for periods less than one year. |
The accompanying notes are an integral part of these financial statements
12 | Jensen Quality Value Fund | Annual Report |
Notes to Financial
Statements
May 31, 2013
1. Organization
Trust for Professional Managers (the Trust) was organized as
a Delaware statutory trust under a Declaration of Trust dated May 29, 2001. The
Trust is registered under the Investment Company Act of 1940, as amended (the
1940 Act), as an open-end management investment company. The Jensen Quality
Value Fund (the Fund), formerly known as the Jensen Value Fund, represents a
distinct diversified series with its own investment objectives and policies
within the Trust. The investment objective of the Fund is long-term capital
appreciation. The Trust may issue an unlimited number of shares of beneficial
interest at $0.001 par value. The assets of the Fund are segregated, and a
shareholders interest is limited to the fund in which shares are held. The Fund
became effective and commenced operations on March 31, 2010. The Fund currently
offers Class J and Class I shares. Class J shares are subject to a 0.25%
distribution (Rule 12b-1) fee and Class I shares are subject to a shareholder
servicing fee up to 0.10%. Each class of shares has identical rights and
privileges except with respect to the distribution (Rule 12b-1) and shareholder
servicing fees, and voting rights on matters affecting a single share class.
Costs incurred by the Fund in connection with the organization, registration and
the initial public offering of shares were paid by Jensen Investment Management,
Inc. (the Adviser), the Funds investment adviser.
2. Significant Accounting
Policies
The following is a summary of
significant accounting policies consistently followed by the Fund in the
preparation of the financial statements. These policies are in conformity with
generally accepted accounting principles in the United States of America
(GAAP).
(a) Investment Valuation Each security owned by the Fund that is listed on a securities exchange is valued at its last sale price on that exchange on the date as of which assets are valued. When the security is listed on more than one exchange, the Fund will use the price of the exchange that the Fund generally considers to be the principal exchange on which the stock is traded.
Fund securities listed on the NASDAQ Stock Market, Inc. (NASDAQ) will be valued at the NASDAQ Official Closing Price (NOCP), which may not necessarily represent the last sale price. If the NOCP is not available, such securities shall be valued at the last sale price on the day of valuation. If there has been no sale on such exchange or on NASDAQ on such day, the security is valued at the mean between the bid and asked prices on such day.
Debt securities other than short-term instruments are valued at the mean between the closing bid and asked prices provided by a pricing service (Pricing Service). If the closing bid and asked prices are not readily available, the Pricing Service may provide a price determined by a matrix pricing method or other analytical pricing models. Short-term debt securities such as commercial paper, bankers acceptances and U.S. Treasury Bills, having a maturity of less than 60 days are valued at amortized cost. If a short-term debt security has a maturity of greater than 60 days, it is valued at market price. Any discount or premium is accreted or amortized on a straight-line basis until maturity.
When market quotations are not readily available, any security or other financial instrument is valued at its fair value as determined under procedures approved by the Trusts Board of Trustees. These fair value procedures will also be used to price a security when corporate events, events in the securities market and/or world events cause the Adviser to believe that a securitys last sale price may not reflect its actual fair value. The intended effect of using fair value pricing procedures is to ensure that the Fund is accurately priced.
Redeemable securities issued by open-end, registered investment companies, including money market funds, are valued at the net asset value (NAV) of such companies for purchase and/or redemption orders placed on that day.
Financial Accounting Standards Board (FASB) Accounting Standards Codification, Fair Value Measurements and Disclosures Topic 820 (ASC 820), establishes an authoritative definition of fair value and sets out a hierarchy for measuring fair value. ASC 820 requires an entity to evaluate certain factors to determine whether there has been a significant decrease in volume and level of activity for the security such that recent transactions and quoted prices may not be determinative of fair value and further analysis and adjustment may be necessary to estimate fair value. ASC 820 also requires enhanced disclosure regarding the inputs and valuation techniques used to measure fair value in those instances as well as expanded disclosure of valuation levels for each class of investments. These inputs are summarized in the three broad levels listed below:
Annual Report | Jensen Quality Value Fund | 13 |
The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. The following is a summary of the inputs used to value the Funds investments carried at fair value as of May 31, 2013:
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Common Stock (1) | $20,192,865 | $ | | $ | | $20,192,865 | |||||||||
Short-Term | |||||||||||||||
Investments | 246,122 | | | 246,122 | |||||||||||
Total Investments | $20,438,987 | $ | | $ | | $20,438,987 |
(1) See the Schedule of Investments for industry classifications.
The Fund did not hold any investments during the year with significant unobservable inputs which would be classified as Level 3. During the year ended May 31, 2013, there were no significant transfers between levels for the Fund. It is the Funds policy to record transfers between levels as of the end of the reporting period. The Fund did not hold financial derivative instruments during the year ended May 31, 2013.
(b) Federal Income Taxes The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code necessary to qualify as a regulated investment company and to make the requisite distributions of income and capital gains to its shareholders sufficient to relieve it from all or substantially all federal income taxes. Therefore, no federal income tax provision has been provided.
As of and during the year ended May 31, 2013, the Fund did not have a liability for any unrecognized tax benefits. The Fund recognizes interest and penalties, if any, related to uncertain tax benefits as income tax expense in the Statement of Operations. During the year, the Fund did not incur any interest or penalties. Open tax years are those that are open for exam by taxing authorities. As of May 31, 2013, open Federal tax years include the tax years ended May 31, 2010 through 2013. The Fund has no examination in progress. The Fund is also not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.
(c) Distributions to Shareholders The Fund will declare and distribute any net investment income quarterly. The Fund will distribute any net realized long- or short-term capital gains at least annually. Distributions from net realized gains for book purposes may include short-term capital gains. All short-term capital gains are included in ordinary income for tax purposes. Distributions to shareholders are recorded on the ex-dividend date. The Fund may also pay a special distribution at the end of the calendar year to comply with federal tax requirements.
(d) Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
(e) Share Valuation The NAV per share of the Fund is calculated by dividing the sum of the value of the securities held by the Fund, plus cash or other assets, minus all liabilities (including estimated accrued expenses) by the total number of shares outstanding for the Fund, rounded to the nearest cent. The Funds shares will not be priced on the days on which the New York Stock Exchange (NYSE) is closed for trading.
(f) Allocation of Income, Expenses and Gains/Losses Income, expenses (other than those deemed attributable to a specific share class), and gains and losses of the Fund are allocated daily to each class of shares based upon the ratio of net assets represented by each class as a percentage of the net assets of the Fund. Expenses deemed directly attributable to a class of shares are recorded by the specific class. Most Fund expenses are allocated by class based on relative net assets. 12b-1 fees are expensed at 0.25% of average daily net assets of Class J shares. Shareholder servicing fees are expensed at up to 0.10% of the average daily net assets of Class I shares. Expenses associated with a specific fund in the Trust are charged to that fund. Common Trust expenses are typically allocated evenly between the funds of the Trust, or by other equitable means.
(g) Other Investment transactions are recorded on the trade date. The Fund determines the gain or loss from investment transactions using the specific identification method by comparing the original cost of the security lot sold with the net sale proceeds. Dividend income is recognized on the ex-dividend date and interest income is recognized on an accrual basis.
3. Federal Tax
Matters
The tax character of distributions
paid during the years ended May 31, 2013 and May 31, 2012 were as
follows:
May 31, 2013 | May 31, 2012 | ||||
Ordinary Income | $310,644 | $726,180 | |||
Long-Term Capital Gain | $95,514 | $230,518 | |||
Short-Term Capital Gain | $ | $ |
14 | Jensen Quality Value Fund | Annual Report |
The components of accumulated earnings (losses) on a tax basis as of May 31, 2013 were as follows:
Cost basis of investments for federal income | |||
tax-purposes | $ | 18,081,356 | |
Gross tax unrealized appreciation | 2,635,525 | ||
Gross tax unrealized depreciation | (277,894 | ) | |
Net tax unrealized appreciation | $2,357,631 | ||
Undistributed ordinary income | 825,218 | ||
Undistributed long-term capital gain | 217,147 | ||
Total distributable earnings | $1,042,365 | ||
Other accumulated gains | $ | ||
Total accumulated gains | $3,399,996 |
The difference between book basis and tax basis of investments is primarily attributable to the deferral of losses on wash sales.
On June 24, 2013 and June 25, 2013, the Fund declared and paid, respectively, a distribution from ordinary income of $23,774 and $11,761 for Class J and Class I, respectively.
Additionally, GAAP requires that certain components of net assets relating to permanent differences be reclassified between financial and tax reporting. These reclassifications have no effect on net assets or NAV per share. For the year ended May 31, 2013, no such reclassifications were required.
4. Investment
Adviser
The Trust has an Investment
Advisory Agreement (the Agreement) with the Adviser to furnish investment
advisory services to the Fund. Under the terms of the Agreement, the Fund
compensates the Adviser for its management services at the annual rate of 0.75%
of the Funds average daily net assets.
The Adviser has contractually agreed to waive its management fee and/or reimburse the Funds other expenses at least through September 30, 2013, at the discretion of the Adviser and the Board of Trustees, to the extent necessary to ensure that the Funds total operating expenses (exclusive of front-end or contingent deferred sales loads, taxes, leverage, interest, brokerage commissions, expenses incurred in connection with any merger or reorganization, dividends or interest on short positions, acquired fund fees and expenses and extraordinary items) do not exceed 1.25% and 1.10% (the Expense Limitation Caps) of the Funds average daily net assets, for Class J and Class I shares, respectively. For the year ended May 31, 2013, expenses of $95,073 and $32,070 were waived or reimbursed by the Adviser for Class J and Class I shares, respectively. Any such waiver or reimbursement is subject to later adjustment to allow the Adviser to recoup amounts waived or reimbursed to the extent actual fees and expenses for a fiscal period are less than the Expense Limitation Caps in place at the time of waiver; provided, however, that the Adviser shall only be entitled to recoup such amounts over the following three fiscal years.
The following table shows the remaining waived or reimbursed expenses subject to potential recovery expiring:
May 31, 2014 | $124,413 |
May 31, 2015 | $116,712 |
May 31, 2016 | $127,143 |
5. Distribution and Shareholder
Servicing Plan
The Trust adopted a plan
pursuant to Rule 12b-1 (the 12b-1 Plan), on behalf of the Fund, which
authorizes it to pay Quasar Distributors, LLC (the Distributor) a distribution
fee of 0.25% of the Funds average daily net assets of Class J shares for
services to prospective Fund shareholders and distribution of Fund shares, and
0.10% of the Funds average daily net assets of Class I shares is payable to
other financial institutions for shareholder servicing. During the year ended
May 31, 2013, the Fund accrued expenses of $30,360 pursuant to the 12b-1 Plan
for distribution fees relating to Class J shares and $913 pursuant to the Rule
12b-1 Plan for shareholder servicing fees relating to Class I shares. As of May
31, 2013, the Distributor was owed fees of $945 for 12b-1 fees relating to Class
J shares and $3,125 for shareholder servicing fees relating to Class I
shares.
6. Related Party
Transactions
U.S. Bancorp Fund Services,
LLC (USBFS or the Administrator) acts as the Funds Administrator under an
Administration Agreement. The Administrator prepares various federal and state
regulatory filings, reports and returns for the Fund; prepares reports and
materials to be supplied to the Trustees; monitors the activities of the Funds
custodian, transfer agent and fund accountant; coordinates the preparation and
payment of the Funds expenses and reviews the Funds expense accruals. For the
year end May 31, 2013, the Fund incurred $29,179 in administration fees. At May
31, 2013, the Administrator was owed fees of $8,021.
Annual Report | Jensen Quality Value Fund | 15 |
USBFS also serves as the fund accountant and transfer agent to the Fund. U.S. Bank, N.A. (US Bank), an affiliate of USBFS, serves as the Funds custodian. For the year ended May 31, 2013, the Fund incurred $15,597, $14,232, and $11,900 in fund accounting, transfer agency, and custody fees, respectively. At May 31, 2013, fees of $7,002, $4,871, and $6,524 were owed for fund accounting, transfer agency, and custody fees, respectively.
The Fund has a line of credit with US Bank (see footnote 10).
The Distributor acts as the Funds principal underwriter in a continuous public offering of the Funds shares. The Distributor is an affiliate of USBFS and US Bank.
Certain officers of the Fund are also employees of USBFS. A Trustee of the Trust is affiliated with USBFS and US Bank. This same Trustee is an interested person of the Distributor.
The Trusts Chief Compliance Officer is also an employee of USBFS. For the year end May 31, 2013, the Fund was allocated $7,490 of the Trusts Chief Compliance Officer fee. At May 31, 2013, fees of $1,878 were owed by the Fund for the Chief Compliance Officers services.
7. Capital Share
Transactions
Transactions in shares of the
Fund were as follows:
year ended | year ended | |||||
Class J Shares | May 31, 2013 | May 31, 2012 | ||||
Shares sold | 162,054 | 329,450 | ||||
Shares issued in reinvestment of | ||||||
dividends | 27,420 | 69,907 | ||||
Shares redeemed | (119,540 | ) | (89,591) | |||
Net increase | 69,934 | 309,766 | ||||
year ended | year ended | |||||
Class I Shares | May 31, 2013 | May 31, 2012 | ||||
Shares sold | 20,064 | 179,478 | ||||
Shares issued in reinvestment of | ||||||
dividends | 11,297 | 27,526 | ||||
Shares redeemed | (5,317 | ) | (103,920) | |||
Net increase | 26,044 | 103,084 |
8. Investment
Transactions
The aggregate purchases and
sales of securities, excluding short-term investments, for the Fund for the year
ended May 31, 2013, were $21,109,782 and $20,139,424, respectively. For the year
ended May 31, 2013, there were no purchases or sales of U.S. government
securities for the Fund.
9. Beneficial
Ownership
The beneficial ownership, either
directly or indirectly, of more than 25% of the voting securities of a fund
creates a presumption of control of the Fund, under Section 2(a)(9) of the 1940
Act. At May 31, 2013, Pershing, LLC, for the benefit of its customers, held
82.22% and 78.72% of the outstanding shares of Class J and Class I shares of the
Fund, respectively.
10. Line of Credit
At May 31, 2013, the Fund had a line of credit in the amount
of the lessor of $1,000,000 or 33.33% of the fair value of unencumbered assets
of the Fund, as defined and matures on August 15, 2013. This unsecured line of
credit is intended to provide short-term financing, if necessary, subject to
certain restrictions, in connection with shareholder redemptions. Interest will
be accrued at the prime 3.25% rate (as of May 31, 2013). The credit facility is
with the Funds custodian, U.S. Bank. During the year ended May 31, 2013, the
Fund had borrowings on the line of credit on four days, with an average
borrowing and interest rate on those days of $33,000 and 3.25% respectively.
Interest expense of $12 incurred during the year is included within other
expenses on the Statement of Operations. The December 5, 2012 balance of $51,000
was the maximum amount of borrowings during the year ended May 31,
2013.
11. Recent Accounting
Pronouncement
In January, 2013, the FASB
issue ASU No. 2013-01 Clarifying the Scope of Disclosures about Offsetting
Assets and Liabilities in GAAP and International Reporting Financial Standards
(IFRS). ASU No. 2013-01 clarifies ASU No. 2011-11, Disclosures about
Offsetting Assets and Liabilities to increase comparability and reduce
presentation differences between financial statements prepare in accordance with
GAAP and financial statements prepared in accordance with IFRS. This requires
increased disclosure about derivative instruments that are offset in a reporting
entitys Statement of Assets and Liabilities and derivative instruments that are
subject to a master netting agreement (MNA). Specifically, the ASU requires
reporting entities to present separately for assets and liabilities, a) the
gross amounts of those recognized assets and recognized liabilities, b) the
amounts offset to determine the net amounts presented in the Statement of Assets
and Liabilities, c) The net amount presented in the Statement of Assets and
Liabilities, d) the amounts subject to an enforceable MNA not included in (b),
and e) the net amount after deducting the amounts from (d) and (c). The
effective date of the ASU is for interim and annual periods beginning on or
after January 1, 2013. Management is currently evaluating the impact it will
have on the Funds financial statements. There is no impact of the ASU on the
financial statements of the Fund for the year ended May 31, 2013.
16 | Jensen Quality Value Fund | Annual Report |
Report of Independent Registered Public Accounting Firm
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of May 31, 2013, by correspondence with the custodian and brokers. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of Jensen Quality Value Fund as of May 31, 2013, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the four periods in the period then ended, in conformity with accounting principles generally accepted in the United States of America.
COHEN FUND AUDIT SERVICES,
LTD.
Cleveland, Ohio
July 30, 2013
Annual Report | Jensen Quality Value Fund | 17 |
Expense Example May 31, 2013
As a shareholder of the Fund, you incur ongoing costs, including investment advisory fees, distribution and/or shareholder servicing (12b-1) fees, and other Fund expenses, which are indirectly paid by shareholders. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (December 1, 2012 - May 31, 2013).
Actual Expenses
The first line of the table below for each share class of the
Fund provides information about actual account values and actual expenses.
However, the table does not include shareholder specific fees, such as the
$15.00 fee charged to IRA accounts, or the $12.00 fee charged for wire
redemptions. The table also does not include portfolio trading commissions and
related trading costs. You may use the information in this line, together with
the amount you invested, to estimate the expenses that you paid over the period.
Simply divide your account value by $1,000 (for example, an $8,600 account value
divided by $1,000 = 8.6), then multiply the result by the number in the first
line under the heading entitled Expenses Paid During Period to estimate the
expenses you paid on your account during this period.
Hypothetical Example for Comparison
Purposes
The second line of the table
below provides information about hypothetical account values and hypothetical
expenses based on the actual expense ratios for each share class of the Fund and
an assumed rate of return of 5% per year before expenses, which is not the
Funds actual return. The hypothetical account values and expenses may not be
used to estimate the actual ending account balance or expenses you paid for the
period. You may use this information to compare the ongoing costs of investing
in the Fund and other funds. To do so, compare this 5% hypothetical example with
the 5% hypothetical examples that appear in the shareholder reports of the other
funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads), redemption fees, or exchange fees which, although not charged by the Fund, may be charged by other funds. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds.
18 | Jensen Quality Value Fund | Annual Report |
Expense Example Tables
Expenses Paid During | ||||||||||||||
Beginning Account Value | Ending Account Value | Period* December 1, 2012 | ||||||||||||
Jensen Quality Value Fund Class J | December 1, 2012 | May 31, 2013 | May 31, 2013 | |||||||||||
Actual | $1,000.00 | $1,231.80 | $6.96 | |||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,018.70 | 6.29 |
* Expenses are equal to the Funds annualized expense ratio of 1.25%, multiplied by the average account value over the period, multiplied by 182/365 to reflect the one-half year period.
Expenses Paid During | ||||||||||||||
Beginning Account Value | Ending Account Value | Period* December 1, 2012 | ||||||||||||
Jensen Quality Value Fund Class I | December 1, 2012 | May 31, 2013 | May 31, 2013 | |||||||||||
Actual | $1,000.00 | $1,233.10 | $6.12 | |||||||||||
Hypothetical (5% return before expenses) | 1,000.00 | 1,019.45 | 5.54 |
* Expenses are equal to the Funds annualized expense ratio of 1.10%, multiplied by the average account value over the period, multiplied by 182/365 to reflect the one-half year period.
1. Shareholder Notification of Federal
Tax Status
The Fund designated 100% of
dividends declared during the fiscal year ended May 31, 2013 as dividends
qualifying for the dividends received deduction available to corporate
shareholders.
The Fund designated 100% of dividends declared from net investment income during the fiscal year ended May 31, 2013 as qualified dividend income under the Jobs and Growth Tax Relief Reconciliation Act of 2003.
The Fund designated 25.32% of taxable ordinary income distributions as short-term capital gain distributions under Internal Revenue Section 871(k)(2)(c) for the year ended May 31, 2013.
Additional Information Applicable to Foreign Shareholders Only:
The Fund designated 0.00% of ordinary income distributions as interest-related dividends under Internal Revenue Code Section 871(k)(1)(c).
2. Availability of Proxy Voting
Information
The Fund has adopted proxy
voting policies and procedures that delegate to the Adviser the authority to
vote proxies. A description of the Funds proxy voting policies and procedures
is available without charge, upon request, by calling the Fund toll free at
800-992-4144. A description of these policies and procedures is also included in
the Funds Statement of Additional Information, which is available on the SECs
website at http://www.sec.gov.
The Funds proxy voting record for the most recent 12-month period ended June 30 is available without charge, upon request, by calling toll free, 800-992-4144, or by accessing the SECs website at http://www.sec.gov.
3. Portfolio
Holdings
The Fund files its complete
schedule of portfolio holdings with the SEC four times each fiscal year at
quarter-ends. The Fund files its schedule of portfolio holdings with the SEC on
Form N-CSR (second and fourth quarters) and on Form N-Q (first and third
quarters). Shareholders may view the Funds Forms N-CSR and N-Q on the SECs
website at http://www.sec.gov. Forms N-CSR and N-Q may also be reviewed and
copied at the SECs Public Reference Room in Washington, D.C. Information on the
SECs Public Reference Room may be obtained by calling 1-202-551-8090 (direct)
or 1-800-SEC-0330 (general SEC number).
4. Indemnifications
Under the Trusts organizational documents, its officers and
Trustees are indemnified against certain liabilities arising out of the
performance of their duties to the Fund. In addition, in the normal course of
business, the Fund enters into contracts that provide general indemnifications
to other parties. The Funds maximum exposure under these arrangements is
unknown as this would involve future claims that may be made against the Fund
that have not yet occurred. However, the Fund has not had prior claims or losses
pursuant to these contracts and expects the risk of loss to be
remote.
5. Information About
Trustees
The business and affairs of the
Trust are managed under the direction of the Trusts Board of Trustees.
Information pertaining to the Trustees of the Trust is set forth below. The
Statement of Additional Information includes additional information about the
Trustees and is available, without charge, upon request by calling
800-992-4144.
Annual Report | Jensen Quality Value Fund | 19 |
6. Householding
In an effort to decrease costs, the Fund intends to reduce the
number of duplicate prospectuses and annual and semi-annual reports you receive
by sending only one copy of each to those addresses shared by two or more
accounts and to shareholders the Fund reasonably believes are from the same
family or household. Once implemented, if you would like to discontinue
householding for your accounts, please call toll-free at 800-992-4144 to request
individual copies of these documents. Once the Fund receives notice to stop
householding, the Fund will begin sending individual copies 30 days after
receiving your request. This policy does not apply to account
statements.
20 | Jensen Quality Value Fund | Annual Report |
Notice of Privacy Policy & Practices
We collect non-public personal information about you from the following sources:
We do not disclose any non-public personal information about our shareholders or former shareholders without the shareholders authorization, except as permitted by law or in response to inquiries from governmental authorities. We may share information with affiliated parties and unaffiliated third parties with whom we have contracts for servicing the Fund. We will provide unaffiliated third parties with only the information necessary to carry out their assigned responsibility. All shareholder records will be disposed of in accordance with applicable law. We maintain physical, electronic and procedural safeguards to protect your non-public personal information and require third parties to treat your non-public personal information with the same high degree of confidentiality.
In the event that you hold shares of the Fund through a financial intermediary, including, but not limited to, a broker-dealer, bank or trust company, the privacy policy of your financial intermediary would govern how your non-public personal information would be shared with unaffiliated third parties.
Annual Report | Jensen Quality Value Fund | 21 |
Independent Trustees
Name, Address and Age |
Position(s)
Held
with the Trust |
Term of
Office
and Length of Time Served |
Principal
Occupation(s) During
the Past Five Years |
Number
of
Portfolios in Trust Overseen by Trustee |
Other Directorships
Held by Trustee |
Dr. Michael D. Akers
|
Trustee |
Indefinite Term;
|
Professor and Chair of Accounting, Marquette University (2004Present). |
29 |
Independent Trustee, USA MUTUALS (an open-end investment company with two portfolios). |
|
|
|
|
|
|
Gary A. Drska
|
Trustee |
Indefinite Term; Since
August 22, 2001 |
Pilot, Frontier/Midwest Airlines, Inc. (airline company) (1986Present). |
29 |
Independent Trustee, USA MUTUALS (an open-end investment company with two portfolios). |
|
|
|
|
|
|
Jonas B. Siegel
|
Trustee |
Indefinite Term; Since
|
Managing Director, Chief Administrative Officer (CAO) and Chief Compliance Officer (CCO), Granite Capital International Group, L.P. (an investment management firm) (19942011); Vice President, Secretary, Treasurer and CCO of Granum Series Trust (an open-end investment company) (19972007); President, CAO and CCO, Granum Securities, LLC (a broker-dealer) (19972007). |
29 |
Independent Trustee, Gottex Multi-Asset Endowment fund complex (three closed-end investment companies); Independent Trustee, Gottex Multi-Alternatives fund complex (three closed-end investment companies); Ramius IDF, LLC fund complex (two closed-end investment companies). |
22 | Jensen Quality Value Fund | Annual Report |
Interested Trustee and Officers
Name, Address and Age |
Position(s)
Held
with the Trust |
Term of
Office
and Length of Time Served |
Principal
Occupation(s) During
the Past Five Years |
Number
of
Portfolios in Trust Overseen by Trustee |
Other Directorships
Held by Trustee |
Joseph C.
Neuberger
(1)
|
Chairperson
|
Indefinite Term; Since
|
Executive Vice President, U.S. Bancorp Fund Services, LLC (1994Present). |
29 |
Trustee, Buffalo Funds (an open-end investment company with ten portfolios); Trustee, USA MUTUALS (an open-end investment company with two portfolios). |
|
|
|
|
|
|
John Buckel
|
President and
|
Indefinite Term; Since
|
Mutual Fund Administrator, U.S. Bancorp Fund Services, LLC (2004Present). |
N/A | N/A |
|
|
|
|
|
|
Jennifer A. Lima
|
Vice President,
|
Indefinite Term; Since
|
Mutual Fund Administrator, U.S. Bancorp Fund Services, LLC (2002Present). |
N/A | N/A |
|
|
|
|
|
|
Rachel A. Spearo
|
Secretary |
Indefinite Term; Since
|
Vice President, U.S. Bancorp Fund Services, LLC (2004Present). |
N/A | N/A |
|
|
|
|
|
|
Robert M. Slotky
|
Vice President,
|
Indefinite Term; Since
|
Senior Vice President, U.S. Bancorp Fund Services, LLC (2001Present). |
N/A | N/A |
|
|
|
|
|
|
Jesse Schmitting
|
Assistant Treasurer |
Indefinite Term; Since
|
Mutual Fund Administrator, U.S. Bancorp Fund Services, LLC (2008Present). |
N/A | N/A |
(1) | Mr. Neuberger is an interested person of the Trust as defined by the 1940 Act. Mr. Neuberger is an interested person of the Trust by virtue of the fact that he is an interested person of Quasar Distributors, LLC, the Funds principal underwriter. |
Annual Report | Jensen Quality Value Fund | 23 |
Item 2. Code of Ethics.
The registrant has adopted a code of ethics that applies to the registrants principal executive officer and principal financial officer. The registrant has not made any amendments to its code of ethics during the period covered by this report. The registrant has not granted any waivers from any provisions of the code of ethics during the period covered by this report. A copy of the registrants Code of Ethics is incorporated by reference to the Registrants Form N-CSR filed on August 6, 2010.
Item 3. Audit Committee Financial Expert.
The registrants board of trustees has determined that there is at least one audit committee financial expert serving on its audit committee. Dr. Michael Akers is the audit committee financial expert and is considered to be independent as each term is defined in Item 3 of Form N-CSR. Dr. Akers holds a Ph.D. in accountancy and is a professor of accounting at Marquette University in Milwaukee, Wisconsin.
Item 4. Principal Accountant Fees and Services.
The registrant has engaged its principal accountant to perform audit services, audit-related services, tax services and other services during the past two fiscal years. Audit services refer to performing an audit of the registrant's annual financial statements or services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for those fiscal years. Audit-related services refer to the assurance and related services by the principal accountant that are reasonably related to the performance of the audit. Tax services refer to professional services rendered by the principal accountant for tax compliance, tax advice, and tax planning. The following table details the aggregate fees billed or expected to be billed for each of the last two fiscal years for audit fees, audit-related fees, tax fees and other fees by the principal accountant.
FYE 5/31/2013 | FYE 5/31/2012 | |||||
Audit Fees | $ | 14,000 | $ | 13,500 | ||
Audit-Related Fees | $ | 0 | $ | 0 | ||
Tax Fees | $ | 2,500 | $ | 2,500 | ||
All Other Fees | $ | 0 | $ | 0 |
The audit committee has adopted pre-approval policies and procedures that require the audit committee to pre-approve all audit and non-audit services of the registrant, including services provided to any entity affiliated with the registrant.
The percentage of fees billed by Cohen Fund Audit Services, Ltd. applicable to non-audit services pursuant to waiver of pre-approval requirement were as follows:
FYE 5/31/2013 | FYE 5/31/2012 | |||
Audit-Related Fees | 0% | 0% | ||
Tax Fees | 0% | 0% | ||
All Other Fees | 0% | 0% |
All of the principal accountants hours spent on auditing the registrants financial statements were attributed to work performed by full-time permanent employees of the principal accountant.
The following table indicates the non-audit fees billed or expected to be billed by the registrants accountant for services to the registrant and to the registrants investment adviser (and any other controlling entity, etc.not sub-adviser) for the last two years. The audit committee of the board of trustees has considered whether the provision of non-audit services that were rendered to the registrant's investment adviser is compatible with maintaining the principal accountant's independence and has concluded that the provision of such non-audit services by the accountant has not compromised the accountants independence.
Non-Audit Related Fees | FYE 5/31/2013 | FYE 5/31/2012 | ||
Registrant | $0 | $0 | ||
Registrants Investment Adviser | $0 | $0 |
Item 5. Audit Committee of Listed Registrants.
Not applicable to registrants who are not listed issuers (as defined in Rule 10A-3 under the Securities Exchange Act of 1934).
Item 6. Investments.
(a) Schedule of Investments is included as part of the report to shareholders filed under Item 1 of this Form.
(b) Not Applicable.
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.
Not applicable to open-end investment companies.
Item 8. Portfolio Managers of Closed-End Management Investment Companies.
Not applicable to open-end investment companies.
Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.
Not applicable to open-end investment companies.
Item 10. Submission of Matters to a Vote of Security Holders.
There have been no material changes to the procedures by which shareholders may recommend nominees to the registrants board of Trustees.
Item 11. Controls and Procedures.
(a) | The Registrants President and Treasurer have reviewed the Registrant's disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940 (the Act)) as of a date within 90 days of the filing of this report, as required by Rule 30a- 3(b) under the Act and Rules 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934. Based on their review, such officers have concluded that the disclosure controls and procedures are effective in ensuring that information required to be disclosed in this report is appropriately recorded, processed, summarized and reported and made known to them by others within the Registrant and by the Registrants service provider. | |
(b) | There were no changes in the Registrant's internal control over financial reporting (as defined in Rule 30a-3(d) under the Act) that occurred during the last fiscal half-year of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the Registrant's internal control over financial reporting. |
Item 12. Exhibits.
(a) | (1) Any code of ethics or amendment thereto, that is the subject of the disclosure required by Item 2, to the extent that the registrant intends to satisfy Item 2 requirements through filing an exhibit. Incorporated by reference to the Registrants Form N-CSR filed August 6, 2010. | ||
(2) A separate certification for each principal executive and principal financial officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. Filed herewith. | |||
(3) Any written solicitation to purchase securities under Rule 23c-1 under the Act sent or given during the period covered by the report by or on behalf of the registrant to 10 or more persons. Not applicable to open-end investment companies. | |||
(b) | Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. Furnished herewith. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant) | Trust for Professional Managers |
By (Signature and Title)* | /s/ John Buckel |
John Buckel, President |
Date | August 5, 2013 |
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
By (Signature and Title)* | /s/ John Buckel |
John Buckel, President |
Date | August 5, 2013 |
By (Signature and Title)* | /s/ Jennifer Lima |
Jennifer Lima, Treasurer |
Date | August 5, 2013 |
* Print the name and title of each signing officer under his or her signature.
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