acp-sof2_ncsr.htm

ACP Strategic Opportunities Fund II, LLC

Other Information (unaudited)

Item 2. Code of Ethics.

(a) The registrant, as of the end of the period covered by this report, has adopted a code of ethics (“Code of Ethics”) that applies to the registrant’s principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, regardless of whether these individuals are employed by the registrant or a third party.

(b) There have been no amendments, during the period covered by this report, to a provision of the Code of Ethics that applies to the registrant’s principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, regardless of whether these individuals are employed by the registrant or a third party, and that relates to any element of the code of ethics definition enumerated in paragraph (b) of this Item.

(c) The registrant, during the period covered by the report, has not granted a waiver, including an implicit waiver, from a provision of the Code of Ethics to the registrant’s principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, regardless of whether these individuals are employed by the registrant or a third party, that relates to one or more of the items set forth in paragraph (b) of this Item.

(d) Not applicable.

(e)(3) The registrant undertakes to provide to any person without charge, upon request, a copy of the Code of Ethics. Such request should be made by calling the registrant collect at 610-688-4180 or writing to ACP Strategic Opportunities Fund II, LLC, 150 N. Radnor Chester Rd., Suite C-220, Radnor, PA 19087.

Item 3. Audit Committee Financial Expert.

As of the end of the period covered by the report, the Board of Directors (the "Board") of the registrant has determined that the Board's audit committee does not have an "audit committee financial expert," as the Securities and Exchange Commission has defined that term. After carefully considering all of the factors involved in the definition of "audit committee financial expert,” the Board determined that none of the members of the audit committee met all five qualifications in the definition, although some members of the audit committees met some of the qualifications. The Board also determined that while the audit committee members have general financial expertise, given the size and activities of the registrant and in light of the nature of the accounting and valuation issues presented over the past several years, it did not appear that the audit committee members lacked any necessary skill to serve on the audit committee.

ACP Strategic Opportunities Fund II, LLC

Other Information (unaudited)

Item 4. Principal Accountant Fees and Services.

Audit Fees

(a)

The aggregate fees billed for each of the last two fiscal years for professional services rendered by the principal accountant for the 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 are $32,500 for 2007 and $36,000 for 2008.

Audit-Related Fees

(b)

The aggregate fees billed in each of the last two fiscal years for assurance and related services by the principal accountant that are reasonably related to the performance of the audit of the registrant's financial statements and are not reported under paragraph (a) of this Item are $0 for 2007 and $0 for 2008.

Tax Fees

(c)

The aggregate fees billed in each of the last two fiscal years for professional services rendered by the principal accountant for tax compliance, tax advice, and tax planning are $0 for 2007 and $0 for 2008.

All Other Fees

(d)

The aggregate fees billed in each of the last two fiscal years for products and services provided by the principal accountant, other than the services reported in paragraphs (a) through (c) of this Item are $0 for 2007 and $0 for 2008.

(e)(1)

Disclose the audit committee's pre-approval policies and procedures described in paragraph (c)(7) of Rule 2-01 of Regulation S-X.

The audit committee pre-approves all audit and permitted non-audit services the independent auditor provides to the registrant, and all services that the independent auditor provides to the registrant’s investment adviser(s) and advisory affiliates (whether or not directly related to the registrant’s operations and financial reporting); except that (a) services provided to a sub-adviser whose role is primarily portfolio management and is sub-contracted or overseen by another investment adviser, and (b) de minimis non-audit services, shall not require pre-approval. A non-audit service is de minimis if: (a) the total amount of the non-audit service is not more than 5% percent of the total amount of revenues paid to the auditor by the registrant, its investment adviser, and advisory affiliates that provide ongoing services to the registrant for services otherwise requiring audit committee pre-approval during the fiscal year in which the non-audit service was provided; (b) the registrant did not recognize these services as non-audit services at the time they were provided; and (c) these services are promptly

ACP Strategic Opportunities Fund II, LLC

Other Information (unaudited)

brought to the attention of the registrant and the registrant approves them before the audit is complete.

(e)(2)

The percentage of services described in each of paragraphs (b) through (d) of this Item that were approved by the audit committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X are as follows:

(b) Not applicable

(d) Not applicable.

(f)

The percentage of hours expended on the principal accountant's engagement to audit the registrant's financial statements for the most recent fiscal year that were attributed to work performed by persons other than the principal accountant's full-time, permanent employees was less than fifty percent.

(g)

The aggregate non-audit fees billed by the registrant's accountant for services rendered to the registrant, and rendered to the registrant's investment adviser (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser), and any entity controlling, controlled by, or under common control with the adviser that provides ongoing services to the registrant for each of the last two fiscal years of the registrant was $0 for 2007 and $0 for 2008.

(h)

Not applicable.

Item 5. Audit Committee of Listed Registrants.

Not applicable

ACP Strategic Opportunities Fund II, LLC

Other Information (unaudited)

Item 6. Schedule of Investments.

As of December 31, 2008, the portfolio holdings of the Underlying Funds by reasonable identifiable categories were as follows:

Long/Short Equities	92.00%
Consumer	11.2%
Financial Services	11.2%
Large Cap Value	9.5%
Mid Cap Growth	6.3%
Natural Resources	9.7%
Small Cap Growth	17.3%
Small Cap Value	7.9%
Technology	18.9%
Money Market	9.1%
Other Assets and Liabilities	-1.1%

All assets other than cash investments, which represent -1.1% of the Fund’s portfolio, should be considered illiquid investments. In this regard, all Underlying Funds should be considered illiquid investments. These investments represent 92% of the Fund’s portfolio. The liquidity provisions of each Underlying Fund are described in the Notes to the Financial Statements for the Fund. The Fund is available only to investors who are “accredited investors” under Regulation D promulgated by the SEC under the Securities Act of 1933, as amended. Each investor must also have a net worth of $1.5 million or more, subject to certain exceptions. Each investor must have such knowledge and experience in financial and business matters that such investor is capable of evaluating the merits and risks of this investment and must be able to bear the economic risks of this investment.

Special situations affecting the calculation of net asset value may arise form time to time. Generally, the Fund, the investment adviser and the administrator will not be able to examine or verify the valuations provided by the Underlying Funds. Absent bad faith or manifest error, the determination of net asset value of the Fund is conclusive and binding on all investors.

ACP Strategic Opportunities Fund II, LLC

Other Information (unaudited)

Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.

ASCENDANT CAPITAL PARTNERS, LP

ACP STRATEGIC OPPORTUNITIES FUND II, LLC

ACP FUNDS TRUST

Proxy Voting Policy and Procedures

Ascendant Capital Partners, LP (Ascendant or ACP), acts as a fiduciary in relation to clients and the assets entrusted by them to its management. Where the assets placed in ACP's care include voting securities, and except where the client has expressly reserved to itself the duty to vote proxies, it is ACP's duty as a fiduciary to vote all proxies relating to such voting securities.

Duties with Respect to Proxies:

Ascendant has an obligation to vote all proxies appurtenant to voting securities owned by its client accounts in the best interests of those clients. In voting these proxies, Ascendant may not be motivated by, or subordinate the client's interests to, its own objectives or those of persons or parties unrelated to the client. Ascendant will exercise all appropriate and lawful care, skill, prudence and diligence in voting proxies, and shall vote all proxies relating to shares owned by its client accounts and received by it. Ascendant shall not be responsible, however, for voting proxies that it does not receive in sufficient time to respond.

Because Ascendant primarily invests client assets in funds exempt from registration and regulation under the federal securities laws, and since the interest it acquires in such funds typically is a non-voting limited partner or member interest (except under specified, often unusual circumstances), Ascendant does not expect there to be many (if any) meetings convened at which it is expected to vote shares or other interests held (or controlled) by it for the benefit of its clients.

Nonetheless, where client holdings are voting securities and a meeting of security holders is convened, Ascendant will take the following steps to carry out its fiduciary duties as to the client and its assets:

Ascendant will track shareholder meetings convened by companies whose voting securities are held in its client accounts, identify all issues presented to shareholders at such meetings, formulate a principled position on each such issue and ensure that proxies pertaining to all shares owned in client accounts are voted in accordance with such determinations.

Consistent with these duties, Ascendant will rely principally upon research received from, or otherwise delegate all or certain aspects of the proxy voting process to, Institutional Shareholder Services and its Proxy Voting Service (PVS) subsidiary. PVS is a separate investment adviser registered under the Investment Advisers Act of 1940, as amended.

To the extent that it relies upon or delegates duties to PVS, Ascendant will periodically review the methods used by PVS to identify and track shareholder meetings called by publicly traded issuers throughout the United States and around the globe. As appropriate, Ascendant will

ACP Strategic Opportunities Fund II, LLC

Other Information (unaudited)

periodically satisfy itself that PVS operates a system reasonably designed to identify all such meetings and to provide ACP with timely notice of the date, time and place of such meetings.

Ascendant will further review the principles and procedures employed by PVS in making recommendations on voting proxies on each issue presented, and will satisfy itself that PVS's recommendations are: (i) based upon an appropriate level of diligence and research, and (ii) designed to further the interests of shareholders and not serve other unrelated or improper interests.

Notwithstanding its belief that PVS's recommendations are consistent with the best interests of shareholders and appropriate to be implemented for Ascendant's client accounts, Ascendant has the right and the ability to depart from a recommendation made by PVS as to a particular vote, slate of candidates or otherwise, and can direct PVS to vote all or a portion of the shares owned for client accounts in accordance with its preferences. PVS will vote any such shares subject to that direction in strict accordance with all such instructions.

Conflicts of Interest:

Ascendant's stock is not publicly traded, and it is not otherwise affiliated with any issuer whose shares are available for purchase by client accounts. Further, no ACP affiliate currently provides brokerage, underwriting, insurance, banking or other financial services to issuers whose shares are available for purchase by client accounts. Therefore, it believes that any particular proxy issues involving companies that engage Ascendant, either directly or through their pension committee or otherwise, to manage assets on their behalf, generally will not present conflict of interest dangers for the firm or its clients.

Nevertheless, in order to avoid even the appearance of a conflict of interest, the officers of Ascendant will determine, by surveying the Firm's employees or otherwise, whether Ascendant, an affiliate or any of their officers has a business, familial or personal relationship with a participant in a proxy contest, the issuer itself or the issuer's pension plan, corporate directors or candidates for directorships. In the event that any such relationship is found to exist, the firm will take appropriate steps to ensure that any such relationship (or other potential conflict of interest), does not influence its decision to provide direction to PVS on a given vote or issue. Further to that end, ACP will adhere to all recommendations made by PVS in connection with all shares issued by such companies and held in Ascendant client accounts, and, absent extraordinary circumstances that will be documented in writing, will not subject any such proxy to special review. Ascendant will seek to resolve any conflicts of interests that may arise prior to voting proxies in a manner that reflects the best interests of its clients.

Obtaining Proxy Voting Information:

To obtain information on how Ascendant voted proxies, please contact:

Gary E. Shugrue

c/o Ascendant Capital Partners, LP

150 N. Radnor Chester Rd., Suite C-220

Radnor, PA 19087

610-99688-4180

ACP Strategic Opportunities Fund II, LLC

Other Information (unaudited)

Recordkeeping:

ACP shall retain its (i) proxy voting policies and procedures; (ii) proxy statements received regarding client statements; (iii) records or votes it casts on behalf of clients; (iv) records of client requests for proxy voting information, and (v) any documents prepared by Ascendant that are material in making a proxy voting decision. Such records may be maintained with a third party, such as PVS, that will provide a copy of the documents promptly upon request.

Adopted: This 14th day of March, 2008

Item 8. Portfolio Managers of Closed-End Management Investment Companies.

(a)(1)

Identification of Portfolio Manager(s) or Management Team Members and Description of Role of Portfolio Manager(s) or Management Team Members

As of the date of this report, Gary E. Shugrue is the Founder, President and Chief Investment Officer of Ascendant Capital Partners, LP (“ACP”), the investment adviser to the registrant. Mr. Shugrue serves as portfolio manager to the ACP Strategic Opportunities Fund II, LLC as well as the ACP Funds Trust. He started ACP in August 2001 as a subsidiary of Turner Investment Partners, a $13 billion asset management firm. He brings nineteen years of hedge fund experience and over thirty years overall investment experience to the firm. From 1988 to 2000 he served as the co-founder and partner of Argos Advisors LLC, an equity hedge fund firm. From 1981 to 1988 he was a Vice President in Institutional Equity Sales with Kidder Peabody, Prudential Securities and Merrill Lynch servicing large institutional clients in the Mid-Atlantic area. From 1977 to 1979 he was an Account Executive with Merrill Lynch. He earned his MBA in Finance from the University of Pennsylvania’s Wharton School in 1981 and his BS in Accounting from Villanova University in 1976.

(a)(2)

Other Accounts Managed by Portfolio Manager(s) or Management Team Member and Potential Conflicts of Interest

Gary E. Shugrue is also the portfolio manager for ACP Funds Trust. The portfolios of ACP Funds Trust- ACP Institutional Series Strategic Opportunities Fund and ACP Advantage Series Strategic Opportunities Fund - invest exclusively in the registrant. The assets of the ACP Funds Trust as of 12/31/08 were approximately $22,767,937 million.

Although ACP does not receive an advisory fee based on account performance, ACP’s management fee changes depending on performance of the portfolio (i.e. ACP earns a greater percentage of assets as a management fee as annual performance of the registrant exceeds 6%.)

ACP Strategic Opportunities Fund II, LLC

Other Information (unaudited)

Name of Portfolio Manager or Team Member	Type of Accounts	Total No. of Accounts Managed	Total Assets 12/31/08	No. of Accounts where Advisory Fee is Based on Performance	Total Assets in Accounts where Advisory Fee is Based on Performance
Gary E. Shugrue	Registered Investment Companies: RICS	2	$22.7 million	0	$0
	Other Pooled Investment Vehicles: LLC	1	$14.2 million	0	$0
	Other Accounts:	0	$0	0	$0

Potential Conflicts of Interests

A potential conflict of interest may arise in that Gary E. Shugrue directs the ACP Funds Trust portfolios to invest in the registrant, for which he receives compensation.

(a)(3) Compensation Structure of Portfolio Manager(s) or Management Team Members

As of December 31, 2008, compensation received by the registrant’s Portfolio Manager is a fixed base salary, with a possible year-end bonus based on the financial performance of the investment adviser. However, Gary E. Shugrue, the Portfolio Manager, benefits not because of his bonus but because he is the controlling equity holder in the firm. As such, the value of his equity and his distributions increase if the registrant’s assets increase and the fund performs well, as described above. Other than as described above, the Portfolio Manager does not receive any compensation from the registrant, the registrant’s investment adviser or any other source with respect to management of the registrant and any other accounts included in the response to paragraph (a)(2)(ii) of this Item 8. As assets under management grow, it is the intention of Ascendant Capital Partners, LP to retain and attract talented employees through attractive compensation and growth opportunities.

(a)(4) Disclosure of Securities Ownership

The table below sets forth beneficial ownership of shares of the registrant by the Portfolio Manager as of December 31, 2008.

Name of Portfolio Manager or Team Member		Dollar ($) Range of Fund Shares Beneficially Owned

Gary E. Shugrue		$10,001 - $50,000

ACP Strategic Opportunities Fund II, LLC

Other Information (unaudited)

Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.

Not applicable.

Item 10. Submission of Matters to a Vote of Security Holders.

Not applicable.

Item 11. Controls and Procedures.

(a)

The registrant’s principal executive and principal financial officers, or persons performing similar functions, have concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”) (17 CFR 270.30a-3(c))) are effective, as of a date within 90 days of the filing date of the report that includes the disclosure required by this paragraph, based on their evaluation of these controls and procedures required by Rule 30a-3(b) under the 1940 Act (17 CFR 270.30a-3(b)) and Rules 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934, as amended (17 CFR 240.13a-15(b) or 240.15d-15(b)).

(b)

There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act (17 CFR 270.30a-3(d)) that occurred during the registrant’s second fiscal quarter 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)

Code of ethics

(a)(2)

Certifications pursuant to Rule 30a-2(a) under the 1940 Act and Section 302 of the Sarbanes-Oxley Act of 2002 are attached hereto.

(a)(3)

Not applicable.

(b)	Not applicable.

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)

ACP Strategic Opportunities Fund II, LLC

By (Signature and Title)*	/s/ Gary E. Shugrue
	Gary E. Shugrue, President, Chief Investment Officer and Chief Financial Officer (principal executive officer and principal financial officer)

Date	March 9, 2008

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/ Gary E. Shugrue
	Gary E. Shugrue, President, Chief Investment Officer and Chief Financial Officer (principal executive officer and principal financial officer)

Date	March 9, 2008

* Print the name and title of each signing officer under his or her signature.


	Page

Report of Independent Registered Public Accounting Firm	1


Schedule of Investments	2


Statement of Assets, Liabilities and Members' Capital	3


Statement of Operations	4


Statement of Changes in Members' Capital	5


Statement of Cash Flows	6


Financial Highlights	7


Notes to the Financial Statements	8 - 16


Board of Directors (unaudited)	17 - 19


Fund Management (unaudited)	20


Other Information (unaudited)	21 - 23


Investments	Percentage of Member's Capital		Fair Value
Underlying Funds
Long/Short Equity ^#

Consumer
Tiedemann/Falconer Partners, L.P. (cost $2,000,000)	7.7	%	$	2,727,455
Zeke, L.P. (cost $1,090,000)	3.5	%		1,249,884
	11.2	%		3,977,339
Financial Services
Castine Partners, L.P. (cost $3,000,000)	11.2	%		3,998,886

Large Cap Value
Aristos Capital, L.P. (cost $1,500,000)	4.1	%		1,451,573
Healy Circle Partners, L.P. (cost $1,808,000)	5.4	%		1,940,251
	9.5	%		3,391,824
Mid Cap Growth
JetStream Global Institutional Fund, L.P. (cost $1,500,000)	6.3	%		2,261,471

Natural Resources
Hard Assets Partners, L.P. (cost $2,000,000)	6.8	%		2,423,393
Harpswell Capital Partners, L.P. (cost $1,000,000)	2.9	%		1,046,329
	9.7	%		3,469,722
Small Cap Growth
Akahi Fund, L.P. (cost $3,000,000)	9.2	%		3,271,136
Bluefin Investors, L.P. (cost $2,500,000)	8.1	%		2,885,223
	17.3	%		6,156,359
Small Cap Value
Rivanna Partners, L.P. (cost $2,500,000)	7.9	%		2,805,798
Technology
Brightfield Partners, L.P. (cost $2,190,000)	5.4	%		1,917,607
Connective Capital I, L.P. (cost $2,250,000)	7.7	%		2,726,772
STG Capital Partners (QP), L.P. (cost $2,000,000)	5.8	%		2,058,326
	18.9	%		6,702,705

Total Long/Short Equity (cost $28,338,000)	92.0	%		32,764,104

Money Market:
Federated Treasury Obligations Fund (cost $3,258,241)	9.1	%		3,258,241
Total Money Market (cost $3,258,241)	9.1	%		3,258,241

Total Investments in Underlying Funds (cost $31,596,241)*	101.1	%	$	36,022,345
Other Assets and Liabilities	-1.1	%		(400,674	)
Members' Capital	100.0	%	$	35,621,671


Gross Unrealized Appreciation	$	4,746,924
Gross Unrealized Depreciation		(320,820	)
Net Unrealized Appreciation	$	4,426,104


Assets:
Investments in underlying funds, at fair value (cost, $31,596,241)	$	36,022,345
Receivables:
Redemption from underlying fund		3,639,923
Receivable from Investment Manager		55,334
Due from affiliates		2,000
Dividends		606
Other assets		10,397

Total assets		39,730,605

Liabilities:
Withdrawals payable		3,952,047
Contributions received in advance		75,000
Accrued expenses:
Professional fees		72,513
Accounting and administration fees		4,930
Directors' and officer's fees		2,750
Other accrued expenses		887
Custody fees		807

Total liabilities		4,108,934

Members' capital	$	35,621,671


Members' capital
Represented by:
Capital contributions (net)	$	31,784,935
Accumulated net investment loss		(2,340,149	)
Accumulated net realized gain on investments		1,750,781
Net unrealized appreciation on investments		4,426,104

Members' capital	$	35,621,671

Units Outstanding (100,000,000 units authorized)		2,684,232

Net Asset Value per Unit (offering and redemption price per unit)	$	13.27


Investment Income
Dividends	$	37,597
Other		6
Total investment income		37,603

Expenses
Investment management fee		532,633
Professional fees		236,536
Accounting and administration fees		61,826
Board of Directors' and officer's fees		60,750
Insurance expense		18,500
Custody fees		5,393
Other expenses		23,347
Total expenses		938,985

Net investment loss		(901,382	)

Realized and unrealized gain (loss) from investments
Net realized gain from investments in underlying funds		12,509
Net decrease in unrealized appreciation on investments in underlying funds		(3,136,544	)
Net realized and unrealized gain (loss) from investments		(3,124,035	)

Net decrease in members' capital resulting from operations	$	(4,025,417	)


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

ACP Strategic Opportunities Fund II, LLC
(Exact name of registrant as specified in charter)

150 N. Radnor Chester Rd., C-220
	Radnor, PA 19087
(Address of principal executive offices) (Zip code)

Gary E. Shugrue
Ascendant Capital Partners LP
150 N. Radnor Chester Rd., Suite C-220
	Radnor, PA 19087
(Name and address of agent for service)


	For the Year Ended			For the Year Ended
	December 31, 2008			December 31, 2007
Members' capital - beginning of year	$	37,450,115		$	27,129,830
Capital contributions		10,192,342			9,053,753
Capital withdrawals		(7,995,369	)		(2,575,530	)
Net investment loss		(901,382	)		(593,356	)
Net realized gain from investments in underlying funds		12,509			975,721
Net decrease in unrealized appreciation on investments in
underlying funds		(3,136,544	)		3,459,697
Members' capital - end of year	$	35,621,671		$	37,450,115


Cash flows from operating activities:
Net decrease in members' capital resulting from operations	$	(4,025,417	)
Adjustments to reconcile net decrease in partners' capital resulting
from operations to net cash used in operating activities:
Net realized gain from investments in underlying funds		(12,509	)
Net change in unrealized appreciation on investments in underlying funds		3,136,544
Cost of investments in underlying funds purchased		(8,500,000	)
Proceeds from redemptions of investments in underlying funds		6,962,509
Net purchase of money market fund		(1,370,183	)
Increase in receivable for redemption of underlying funds		(1,025,936	)
Decrease in receivable from Investment Manager		15,000
Decrease in dividends and interest receivable		2,950
Decrease in other assets		720
Increase in accrued professional fees payable		12,013
Increase in accounting and administration fees payable		242
Decrease in custody fees payable		(1,777	)
Increase in directors' and officer's fees payable		2,750
Increase in other accrued expenses		887

Net cash used in operating activities		(4,802,207	)

Cash flows from financing activities:
Capital contributions received (net of contributions received in advance)		9,017,342
Capital withdrawals paid (net of change in withdrawals payable)		(4,464,314	)

Net cash provided by financing activities		4,553,028


Net decrease in cash		(249,179	)
Cash at beginning of year		249,179
Cash at end of year	$	-


	For the Year Ended December 31,
	2008			2007			2006			2005			2004
NET ASSET VALUE, Beginning of Year	$	14.68		$	13.07		$	12.10		$	11.39		$	10.64

INVESTMENT OPERATIONS
Net investment loss		(0.31	) (a)		(0.25	) (a)		(0.16	) (a)		(0.15	) (a)		(0.17	) (a)
Net realized and unrealized gain (loss)
from investments in Underlying Funds		(1.10	)		1.86			1.13			0.86			0.92
Total from investment operations		(1.41	)		1.61			0.97			0.71			0.75


NET ASSET VALUE, End of Year	$	13.27		$	14.68		$	13.07		$	12.10		$	11.39

TOTAL RETURN		(9.60	)%		12.32	%		8.02	%		6.23	%		7.05	%

RATIOS / SUPPLEMENTAL DATA
Members' Capital at end of year (000's omitted)	$	35,622		$	37,450		$	27,130		$	17,804		$	13,577

Ratios to Average Net Assets:
Net investment loss		(2.19	)%		(1.83	)%		(1.26	)%		(1.29	)%		(1.57	)%
Expenses, net of reimbursements/waiver of fees		2.29	%		2.17	%		1.67	%		1.42	%		1.60	%
Expenses, excluding reimbursements/waiver of fees		2.29	%		2.38	%		2.98	%		3.17	%		3.27	%

PORTFOLIO TURNOVER RATE		19	%		12	%		11	%		35	%		15	%

(a) Calculated using average shares outstanding during the year.


	Investments
	in
Valuation Inputs	Securities
Level 1 – Quoted Prices	$	3,258,241
Level 2 – Other Significant Observable Inputs		-
Level 3 – Significant Unobservable Inputs		32,764,104

Total	$	36,022,345


	Investments in Securities
Balance as of 12/31/2007	$	34,350,648
Change in Unrealized Appreciation **		(3,136,544	)
Realized gains **		12,509
Net Purchases / (Sales)		1,537,491
Transfers In / (Out) of Level 3		-

Balance as of 12/31/2008	$	32,764,104


	For the		For the
	Year ended		Year ended
	December 31, 2008		December 31, 2007

Number of Units issued	708,169		657,897
Number of Units redeemed	(574,409	)	(183,705	)
Net increase in Units outstanding	133,759		474,192
Units outstanding, beginning of the year	2,550,473		2,076,281
Units outstanding, end of period	2,684,232		2,550,473

Name, Age and	Position(s)	Term of Office	Principal	Number of	Other
Address	Held with	and Length of	Occupation(s)	Portfolios in	Directorships
	Fund	Time Served		Fund Complex	held by
				Overseen by	Director or
				Director	Nominee
John Connors	Director	Term:	Portfolio Manager,	ACP Funds	None.
Age: 66		Indefinite	Guyasuta Investment	Trust (2 series);
100 Matsonford		Length: Since	Advisors (Since	ACP Strategic
Road		2002	12/2000); previously,	Opportunities
Building 5, suite			Portfolio Manager,	Fund II, LLC.
520			Delaware Investments.
Radnor, PA			N/A (1977-2000);
19087			portfolio manager
			Mellon Bank (1967-
			1977); Financial Analyst
			IBM (10/65-6/67)
Robert Andres	Director	Term:	Senior Vice-President,	ACP Funds	None.
Age: 70		Indefinite	Chief Investment	Trust (2 series);
Andres Capital		Length: Since	Strategist,	ACP Strategic
Management		2004	Envestnet/PMC	Opportunities
11 Twin Creek			(present)	Fund II, LLC.
Lane			President, Andres
Berwyn, PA			Capital Management
19312			(2007-2008); previously,
			Haverford Trust (2005-
			2007); Martindale
			Andres & Co. (1989-
			1994); President, Merrill
			Lynch Mortgage
			Capital (1970-
			1987);National Sales
			Manager, Municipal
			Securities, Kidder
			Peabody (1968-1970);
			Herbert J. Sims & Co.
			(1962-1964)Municipal
			Bond Division., J.P.
			Morgan (1957-1962).

James Brinton	Director	Term:	President, Robert J.	ACP Funds	Quaker
Age: 54		Indefinite	McAllister Agency, Inc.	Trust (2 series);	Investment
123 West		Length: Since	(Independent Insurance	ACP Strategic	Trust (8
Lancaster Ave.		2007	Broker)	Opportunities	series).
Wayne, PA			(since 1979)	Fund II, LLC.
19087

Name, Age	Position(s) Held	Term of	Principal	Number of	Other
and Address	with Fund	Office	Occupation(s)	Portfolios in	Directorships
		and	During Past 5	Fund	held by
		Length	Years	Complex	Director or
		of Time		Overseen by	Nominee
		Served		Director
Gary	President, Chief	Term:	President &	ACP Funds	BHR Fund
Shugrue	Investment	Indefinite	Chief Investment	Trust (2	Advisors;
Age: 54	Officer (CIO) and	Length:	Officer of	series);ACP	Quaker
	Director	Since	Ascendant	Strategic	Investment Trust
		2007	Capital Partners,	Opportunities	(8 series)
		(Director)	LP. (since	Fund II, LLC).
		Since	2001);
		2001	previously,
		(President	General Partner
		and	of Argos
		CIO)	Advisors (1988-
			2000).

Stephanie	Chief Operating	Term:	Director, Client	n/a	n/a
Strid Davis	Officer; Director,	Indefinite	Service and
Age: 38	Client Service	Length:	Fund
	and Fund	Since	Operations of
	Administration;	2001	ACP
	Chief		Investments,
	Compliance		LP; previously
	Officer		Institutional
			Equity Sales,
			Credit Suisse
			First Boston