N-CSRS 1 pinnaclencsrs.htm N-CSRS

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 811-22655

 

Northern Lights Fund Trust III

(Exact name of registrant as specified in charter)

 

225 Pictoria Drive, Suite 450 Cincinnati, OH 45246

(Address of principal executive offices) (Zip code)

 

Eric Kane 80 Arkay Drive, Hauppauge, NY 11788

(Name and address of agent for service)

 

Registrant's telephone number, including area code: 631-470-2720

 

Date of fiscal year end: 9/30

 

Date of reporting period: 3/31/21

 

Item 1. Reports to Stockholders.

 

 

 

 

Pinnacle Sherman Multi-Strategy Core Fund

 

Class A Shares (APSHX)

Class C Shares (CPSHX)

Class I Shares (IPSHX)

 

Pinnacle TrendRating Innovative Equity Fund

 

Class A Shares (APTRX)

Class C Shares (CPTRX)

Class I Shares (IPTRX)

 

Semi-Annual Report

March 31, 2021

 

 

1-888-985-9830

www.pinnacledynamicfunds.com

 

 

Distributed by Northern Lights Distributors, LLC

Member FINRA

 

 

PINNACLE SHERMAN MULTI-STRATEGY CORE FUND

PORTFOLIO REVIEW (Unaudited)

March 31, 2021

 

The Fund’s performance figures* for the periods ended March 31, 2021, compared to its benchmark:

 

               Annualized
         Annualized  Annualized  Inception*** -
   Six Months  One Year  Three Years  Five Years  March 31, 2021
Pinnacle Sherman Multi-Strategy Core Fund - Class A  18.83%  44.01%  10.02%  8.46%  8.46%
Pinnacle Sherman Multi-Strategy Core Fund - Class A with load  12.02%  35.68%  7.87%  7.29%  7.29%
Pinnacle Sherman Multi-Strategy Core Fund - Class C  18.41%  42.84%  9.20%  7.87%  7.65%
Pinnacle Sherman Multi-Strategy Core Fund - Class I  19.04%  44.35%  10.32%  8.95%  8.75%
Dow Jones Moderately Aggressive Portfolio Index **  19.83%  48.91%  10.82%  11.75%  11.59%

 

*Performance data quoted here represents past performance. The performance comparison includes reinvestment of all dividends and capital gain distributions and has been adjusted for the Class A maximum applicable sales charge of 5.75%. Current performance may be lower or higher than the performance data quoted above. Past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. The returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or on the redemption of Fund shares. The Fund’s total annual operating expenses, before any fee waivers, are 2.02% for Class A shares, 2.77% for Class C shares and 1.77% for Class I shares per the February 1, 2021 prospectus. Redemptions made within 60 days of purchase may be assessed a redemption fee of 1.00%. For performance information current to the most recent month-end, please call toll-free 1-888-985-9830.

  

**Dow Jones Moderately Aggressive Portfolio Index® – A global benchmark that takes 80% of the risk of the global securities market. It is a total return index that is a time-varying weighted average of stocks, bonds, and cash. The Index is the efficient allocation of stocks, bonds, and cash in a portfolio with 80% of the risk of the Dow Jones Moderately Aggressive Portfolio Index. The Index is calculated on a total return basis with dividends reinvested. The Index is unmanaged, its returns do not reflect any fees, expenses, or sales charges, and is not available for direct investment.

  

***Inception date is October 1, 2015.

 

The Fund’s holdings by asset class as of March 31, 2021 are as follows:

 

Asset Class  % of Net Assets 
Exchange Traded Funds - Equity Funds   50.9%
Short Term Investment   25.9%
Common Stock   23.1%
Other Assets in Excess of Liabilities   0.1%
    100.0%

 

Please refer to the Portfolio of Investments in this Semi-Annual Report for a detailed listing of the Fund’s holdings.

 

 

PINNACLE TRENDRATING INNOVATIVE EQUITY FUND

PORTFOLIO REVIEW (Unaudited)

March 31, 2021

 

The Fund’s performance figures* for the periods ended March 31, 2021, compared to its benchmark: 

 

         Annualized
         Inception*** -
   Six Months  One Year  March 31, 2021
Pinnacle TrendRating Innovative Equity Fund - Class A  6.28%  31.90%  14.59%
Pinnacle TrendRating Innovative Equity Fund - Class A with load  0.17%  24.29%  11.70%
Pinnacle TrendRating Innovative Equity Fund - Class C  6.27%  32.09%  14.66%
Pinnacle TrendRating Innovative Equity Fund - Class I  6.37%  32.19%  14.75%
S&P 500 Index **  18.14%  53.71%  16.43%

 

*Performance data quoted here represents past performance. The performance comparison includes reinvestment of all dividends and capital gain distributions and has been adjusted for the Class A maximum applicable sales charge of 5.75%. Current performance may be lower or higher than the performance data quoted above. Past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. The returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or on the redemption of Fund shares. The Fund’s total annual operating expenses, before any fee waivers, are 4.14% for Class A shares, 4.89% for Class C shares and 3.89% for Class I shares per the February 1, 2021 prospectus. Redemptions made within 60 days of purchase may be assessed a redemption fee of 1.00%. For performance information current to the most recent month-end, please call toll-free 1-888-985-9830.

  

**The S&P 500 Index is an unmanaged market capitalization-weighted index which is comprised of the largest U.S. domiciled companies and includes the reinvestment of all dividends. Investors may not invest in the Index directly; unlike the Fund’s returns, the Index does not reflect any fees or expenses.

  

***Inception date is December 3, 2018.

 

The Fund’s holdings by asset class as of March 31, 2021 are as follows:

 

Asset Class  % of Net Assets 
Common Stock   98.9%
Other Assets in Excess of Liabilities   1.1%
    100.0%

 

Please refer to the Portfolio of Investments in this Semi-Annual Report for a detailed listing of the Fund’s holdings.

 

 

Pinnacle Sherman Multi-Strategy Core Fund

PORTFOLIO OF INVESTMENTS (Unaudited)

March 31, 2021

  

Shares      Fair Value 
     COMMON STOCK - 23.1%     
     APPAREL & TEXTILE PRODUCTS - 3.6%     
 56,225   Tapestry, Inc.  $2,317,032 
           
     ASSET MANAGEMENT - 3.8%     
 98,281   Invesco Ltd.   2,478,647 
           
     BANKING - 3.6%     
 4,689   SVB Financial Group *   2,314,772 
           
     ENTERTAINMENT CONTENT - 4.7%     
 36,890   Discovery, Inc. *   1,603,239 
 32,597   ViacomCBS, Inc.   1,470,125 
         3,073,364 
     METALS & MINING - 3.7%     
 72,288   Freeport-McMoRan, Inc. *   2,380,444 
           
     RETAIL - DISCRETIONARY - 3.7%     
 39,885   L Brands, Inc. *   2,467,286 
           
     TOTAL COMMON STOCK (Cost $12,696,121)   15,031,545 
           
     EXCHANGE TRADED FUNDS - 50.9%     
     EQUITY FUNDS - 50.9%     
 23,525   First Trust Mid Cap Core AlphaDEX Fund   2,208,414 
 24,330   First Trust Small Cap Core AlphaDEX Fund   2,204,293 
 16,975   iShares Core S&P Mid-Cap ETF   4,418,253 
 20,115   iShares Russell 2000 ETF   4,444,208 
 64,890   iShares S&P Mid-Cap 400 Value ETF   6,614,238 
 52,075   iShares S&P Small-Cap 600 Growth ETF   6,677,577 
 66,040   iShares S&P Small-Cap 600 Value ETF   6,652,870 
     TOTAL EXCHANGE TRADED FUNDS (Cost $29,882,877)   33,219,853 
           
     SHORT-TERM INVESTMENT - 25.9%     
     TIME DEPOSIT - 25.9%     
     Union Bank Institutional Trust Deposit Account - IV to yield 0.07% ^ (Cost $16,909,833)   16,909,833 
     TOTAL SHORT-TERM INVESTMENTS (Cost 16,909,833)     
           
     TOTAL INVESTMENTS - 99.9% (Cost $59,488,831)  $65,161,231 
     OTHER ASSETS IN EXCESS OF LIABILITIES - 0.1%   29,362 
     NET ASSETS - 100.0%  $65,190,593 

 

* - Non income producing security

 

^ - Money Market Fund; Interest rate reflects seven-day effective yield on March 31, 2021.

 

ETF - Exchange Traded Fund

 

S&P - Standard and Poor’s

 

See Accompanying Notes to Financial Statements

 

 

Pinnacle Trendrating Innovative Equity Fund
PORTFOLIO OF INVESTMENTS (Unaudited)
March 31, 2021

  

Shares      Fair Value 
     COMMON STOCK - 98.9%     
     AUTOMOTIVE - 12.5%     
 1,906   Aptiv PLC *  $262,837 
 20,888   Ford Motor Co. *   255,878 
 5,041   General Motors Co.   289,656 
         808,371 
     BIOTECH & PHARMA - 3.9%     
 1,540   Johnson & Johnson   253,099 
           
     E-COMMERCE DISCRETIONARY - 4.4%     
 91   Amazon.com, Inc. *   281,561 
           
     ENTERTAINMENT CONTENT - 9.7%     
 3,056   Activision Blizzard, Inc.   284,208 
 3,742   Viacom CBS, Inc. - Class A   176,510 
 3,746   Viacom CBS, Inc. - Class I   168,945 
         629,663 
     INSTITUTIONAL FINANCIAL SERVICES - 3.8%     
 3,174   Morgan Stanley   246,493 
           
     MACHINERY - 4.1%     
 846   Parker-Hannifin Corp.   266,854 
           
     MEDICAL EQUIPMENT & DEVICES - 7.5%     
 2,038   Abbott Laboratories   244,234 
 530   Thermo Fisher Scientific, Inc.   241,881 
         486,115 
     METALS & MINING - 4.5%     
 4,300   Southern Copper Corp.   291,841 
           
     RETAIL - CONSUMER STAPLES - 3.8%     
 1,800   Walmart, Inc.   244,494 
           
     SEMICONDUCTORS - 24.8%     
 2,910   Advanced Micro Devices, Inc. *   228,435 
 388   ASML Holding NV   239,536 
 667   Broadcom, Inc.   309,261 
 1,618   Microchip Technology, Inc.   251,146 
 456   NVIDIA Corp.   243,472 
 1,666   NXP Semiconductors NV   335,432 
         1,607,282 
     SOFTWARE - 7.3%     
 1,195   Crowdstrike Holdings, Inc. *   218,099 
 1,080   Microsoft Corp.   254,632 
         472,731 
     SPECIALTY FINANCE - 4.0%     
 2,030   Capital One Financial Corp.   258,277 
           
     TECHNOLOGY HARDWARE - 4.4%     
 3,197   Dell Technologies, Inc. *   281,816 
           
     TELECOMMUNICATIONS - 4.2%     
 2,150   T-Mobile US, Inc. *   269,373 
           
     TOTAL COMMON STOCK (Cost $6,039,882)   6,397,970 
           
     TOTAL INVESTMENTS - 98.9% (Cost $6,039,882)  $6,397,970 
     OTHER ASSETS IN EXCESS OF LIABILITIES - 1.1%   72,172 
     NET ASSETS - 100.0%  $6,470,142 

 

* - Non income producing security

 

PLC - Public Limited Company

 

See Accompanying Notes to Financial Statements

 

 

Pinnacle Funds

STATEMENTS OF ASSETS AND LIABILITIES (Unaudited)

March 31, 2021

 

   Pinnacle Sherman   Pinnacle TrendRating 
   Multi-Strategy Core Fund   Innovative Equity Fund 
ASSETS        
Investment Securities:          
At cost  $59,488,831   $6,039,882 
At value   65,161,231    6,397,970 
Cash and cash equivalents   —    82,588 
Due from Adviser   —    7,705 
Dividends and interest receivable   7,364    3,939 
Receivable for Fund shares sold   74,850    13,000 
Prepaid expenses and other assets   30,257    1,689 
TOTAL ASSETS   65,273,702    6,506,891 
           
LIABILITIES          
Payable for investments purchased   —    30,484 
Payable for Fund shares repurchased   1,740    — 
Investment advisory fees payable   47,235    — 
Distribution (12b-1) fees payable   15,231    — 
Trustee fees payable   2,687    1,403 
Payable to related parties   555    351 
Accrued expenses and other liabilities   15,661    4,511 
TOTAL LIABILITIES   83,109    36,749 
NET ASSETS  $65,190,593   $6,470,142 
           
Net Assets Consist Of:          
Paid in capital  $53,834,855   $5,491,420 
Accumulated earnings   11,355,738    978,722 
NET ASSETS  $65,190,593   $6,470,142 
           
Net Asset Value Per Share:          
Class A Shares:          
Net Assets  $12,096,148   $899 
Shares of beneficial interest outstanding ($0 par value, unlimited shares authorized)   859,491    67 
Net asset value (Net Assets ÷ Shares Outstanding) and redemption price per share (a)  $14.07   $13.32 (b)
Maximum offering price per share (maximum sales charge of 5.75%)  $14.93   $14.13 
           
Class C Shares:          
Net Assets  $14,332,229   $14 
Shares of beneficial interest outstanding ($0 par value, unlimited shares authorized)   1,055,990    1 
Net asset value (Net Assets ÷ Shares Outstanding), offering price and redemption price per share (a)  $13.57   $13.34 (b)
           
Class I Shares:          
Net Assets  $38,762,216   $6,469,229 
Shares of beneficial interest outstanding ($0 par value, unlimited shares authorized)   2,732,299    484,200 
Net asset value (Net Assets ÷ Shares Outstanding), offering price and redemption price per share (a)  $14.19   $13.36 

 

 

(a)Redemptions made within 60 days of purchase may be assessed a redemption fee of 1.00%.

 

(b)NAV does not recalculate due to rounding of shares of beneficial interest outstanding.

 

See Accompanying Notes to Financial Statements.

 

 

Pinnacle Funds

STATEMENTS OF OPERATIONS (Unaudited)

For the Six Months Ended March 31, 2021

 

   Pinnacle Sherman   Pinnacle TrendRating 
   Multi-Strategy Core Fund   Innovative Equity Fund 
INVESTMENT INCOME          
Dividends (including $0, $351 of foreign withholding tax)  $262,605   $28,050 
Interest   2,203    38 
TOTAL INVESTMENT INCOME   264,808    28,088 
           
EXPENSES          
Investment advisory fees   292,407    24,142 
Distribution (12b-1) fees:          
Class A   12,865    1 
Class C   66,450    — 
Registration fees   26,945    1,165 
Administrative services fees   22,154    21,902 
Transfer agent fees   22,000    9,377 
Compliance officer fees   10,960    4,542 
Printing and postage expenses   10,311    1,865 
Accounting services fees   10,015    10,260 
Audit fees   7,927    8,475 
Third party administrative servicing fees   6,118    13 
Legal fees   5,070    4,850 
Trustees fees and expenses   4,114    5,474 
Custodian fees   2,777    2,492 
Insurance expense   585    110 
Other expenses   2,327    3,231 
TOTAL EXPENSES   503,025    97,899 
           
Less: Fees waived / expenses reimbursed by the adviser   (59,695)   (66,021)
NET EXPENSES   443,330    31,878 
NET INVESTMENT LOSS   (178,522)   (3,790)
           
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS          
Net realized gain from security transactions and foreign currency transactions   9,648,908    739,948 
Net change in unrealized appreciation (depreciation) on investments   74,011    (347,329)
           
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS   9,722,919    392,619 
           
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS  $9,544,397   $388,829 

 

 

See Accompanying Notes to Financial Statements.

 

 

Pinnacle Sherman Multi-Strategy Core Fund

STATEMENTS OF CHANGES IN NET ASSETS

 

   Six Months Ended   Year Ended 
   March 31,   September 30, 
   2021   2020 
FROM OPERATIONS  (Unaudited)     
Net investment loss  $(178,522)  $(175,219)
Net realized gain from security transactions   9,648,908    2,308,610 
Net change in unrealized appreciation on investments   74,011    3,643,660 
Net increase in net assets resulting from operations   9,544,397    5,777,051 
           
DISTRIBUTIONS TO SHAREHOLDERS          
Total distributions paid:          
Class A   —    (24,748)
Class I   —    (114,703)
Total Distributions to Shareholders   —    (139,451)
           
FROM SHARES OF BENEFICIAL INTEREST          
Proceeds from shares sold:          
Class A   2,423,602    794,221 
Class C   954,610    430,657 
Class I   7,842,419    17,296,150 
Shares issued to shareholders in reinvestment (Note 8):          
Class A   —    3,452,626 
Class C   —    557,691 
Class I   —    4,672,797 
Net asset value of shares issued in reinvestment of distributions:          
Class A   —    23,505 
Class I   —    111,877 
Payments for shares redeemed:          
Class A   (528,062)   (4,100,649)
Class C   (422,999)   (2,988,471)
Class I   (10,575,180)   (3,522,155)
Redemption fee proceeds:          
Class A   124    76 
Class C   1    4 
Class I   2,524    271 
Net increase (decrease) in net assets resulting from shares of beneficial interest   (302,961)   16,728,600 
           
TOTAL INCREASE IN NET ASSETS   9,241,436    22,366,200 
           
NET ASSETS          
Beginning of Period   55,949,157    33,582,957 
End of Period  $65,190,593   $55,949,157 

 

See Accompanying Notes to Financial Statements.

 

 

Pinnacle Sherman Multi-Strategy Core Fund

STATEMENTS OF CHANGES IN NET ASSETS (Continued)

 

   Six Months Ended   Year Ended 
   March 31,   September 30, 
   2021   2020 
SHARE ACTIVITY  (Unaudited)     
Class A:          
Shares Sold   179,259    66,757 
Shares issued due to merger (Note 8)   —    357,755 
Shares Reinvested   —    2,174 
Shares Redeemed   (39,239)   (387,266)
Net increase in shares of beneficial interest outstanding   140,020    39,420 
           
Class C:          
Shares Sold   74,177    39,616 
Shares issued due to merger (Note 8)   —    59,471 
Shares Redeemed   (33,401)   (286,947)
Net increase (decrease) in shares of beneficial interest outstanding   40,776    (187,860)
           
Class I:          
Shares Sold   573,120    1,459,351 
Shares issued due to merger (Note 8)   —    481,637 
Shares Reinvested   —    10,302 
Shares Redeemed   (843,344)   (329,547)
Net increase (decrease) in shares of beneficial interest outstanding   (270,224)   1,621,743 

 

See Accompanying Notes to Financial Statements.

 

 

Pinnacle TrendRating Innovative Equity Fund

STATEMENTS OF CHANGES IN NET ASSETS 

 

   Six Months Ended   Year Ended 
   March 31,   September 30, 
   2021   2020 
FROM OPERATIONS  (Unaudited)     
Net investment loss  $(3,790)  $(2,990)
Net realized gain from security transactions and foreign currency transactions   739,948    8,091 
Net change in unrealized appreciation (depreciation) on investments   (347,329)   584,304 
Net increase in net assets resulting from operations   388,829    589,405 
           
DISTRIBUTIONS TO SHAREHOLDERS          
Total Distributions Paid          
Class A   (7)   (119)
Class C   0 (a)   0 (a)
Class I   (119,777)   (29,782)
Net decrease in net assets resulting from distributions to shareholders   (119,784)   (29,901)
           
FROM SHARES OF BENEFICIAL INTEREST          
Proceeds from shares sold:          
Class A   500    10,775 
Class I   82,373    3,497,243 
Net asset value of shares issued in reinvestment of distributions:          
Class A   7    119 
Class C   0 (a)   0 (a)
Class I   118,805    29,510 
Payments for shares redeemed:          
Class A   —    (16,953)
Class I   (54,860)   (5,600)
Net increase in net assets resulting from shares of beneficial interest   146,825    3,515,094 
           
TOTAL INCREASE IN NET ASSETS   415,870    4,074,598 
           
NET ASSETS          
Beginning of Period   6,054,272    1,979,674 
End of Period  $6,470,142   $6,054,272 
           
SHARE ACTIVITY          
Class A:          
Shares Sold   37    975 
Shares Reinvested   1    10 
Shares Redeemed   —    (1,430)
Net increase (decrease) in shares of beneficial interest outstanding   38    (445)
           
Class C:          
Shares Reinvested   0 (a)   0 (a)
Net increase in shares of beneficial interest outstanding   0 (a)   0 (a)
           
Class I:          
Shares Sold   5,915    293,052 
Shares Reinvested   8,994    2,580 
Shares Redeemed   (3,844)   (487)
Net increase in shares of beneficial interest outstanding   11,065    295,145 

 

(a)Less than $1.

 

See Accompanying Notes to Financial Statements.

 

 

Pinnacle Sherman Multi-Strategy Core Fund

FINANCIAL HIGHLIGHTS

 

Per Share Data and Ratios for a Share of Beneficial Interest Outstanding Throughout Each Period Presented

                         
   Six Months Ended                     
   March 31, 2021   Year Ended   Year Ended   Year Ended   Year Ended   Period Ended 
Class A  (Unaudited)   September 30, 2020   September 30, 2019   September 30, 2018   September 30, 2017   September 30, 2016 (1) 
Net asset value, beginning of period  $11.84   $10.36   $11.71   $11.61   $10.53   $10.00 
Activity from investment operations:                              
Net investment income (loss) (2)   (0.04)   (0.05)   0.04    (0.01)   (0.01)   0.01 
Net realized and unrealized gain / (loss) on investments   2.27    1.58    (1.04)   0.80    1.15    0.52 (10)
Total from investment operations   2.23    1.53    (1.00)   0.79    1.14    0.53 
Less distributions from:                              
Net investment income   —    (0.05)   —    —    (0.02)   — 
Net realized gains   —    —    (0.35)   (0.69)   (0.04)   — 
Total distributions   —    (0.05)   (0.35)   (0.69)   (0.06)   — 
Paid-in-Capital From Redemption Fees (2) (9)   0.00    0.00    0.00    0.00    0.00    0.00 
Net asset value, end of period  $14.07   $11.84   $10.36   $11.71   $11.61   $10.53 
Total return (3)   18.83% (7)   14.81%   (8.31)%   6.96%   10.91%   5.30% (7)
Net assets, at end of period (000s)  $12,096   $8,519   $7,047   $17,779   $25,056   $13,604 
Ratio of gross expenses to average net assets (4)(6)   1.70% (5)   1.85%   1.78%   1.61%   1.63%   1.72% (5)
Ratio of net expenses to average net assets (6)   1.49% (5)   1.49%   1.49%   1.49%   1.49%   1.49% (5)
Ratio of net investment income (loss) to average net assets (6)(8)   (0.55%) (5)   (0.42)%   0.37%   (0.05)%   (0.09)%   0.30% (5)
Portfolio Turnover Rate   276% (7)   560%   607%   402%   337%   449% (7)

 

 

(1)The Pinnacle Sherman Multi-Strategy Core Fund’s Class A shares commenced operations on October 1, 2015.

 

(2)Per share amounts calculated using the average shares method, which more appropriately presents the per share data for the period.

  

(3)Total returns shown are historical in nature and assume changes in share price, reinvestment of dividends and distributions, if any, and exclude the effect of applicable sales charges and redemption fees. Had the adviser not waived fees / reimbursed a portion of its expenses, total returns would have been lower.

 

(4)Represents the ratio of expenses to average net assets absent fee waivers and/or expense reimbursements by the adviser.

  

(5)Annualized.

 

(6)Does not include the expenses of other investment companies in which the Fund invests.

 

(7)Not annualized.

  

(8)Recognition of net investment income by the Fund is affected by the timing of declaration of dividends by the underlying investment companies in which the Fund invests.

  

(9)Amount represents less than $0.01 per share.

 

(10)Realized and unrealized gains and losses per share in this caption are balancing amounts necessary to reconcile the changes in net asset value per share for the period, and may not reconcile with the aggregate gains and losses in the Statement of Operations due to share transactions for the period.

 

See Accompanying Notes to Financial Statements.

 

 

Pinnacle Sherman Multi-Strategy Core Fund

FINANCIAL HIGHLIGHTS

 

Per Share Data and Ratios for a Share of Beneficial Interest Outstanding Throughout Each Period Presented

 

   Six Months Ended                     
   March 31, 2021   Year Ended   Year Ended   Year Ended   Year Ended   Period Ended 
Class C  (Unaudited)   September 30, 2020   September 30, 2019   September 30, 2018   September 30, 2017   September 30, 2016 (1) 
Net asset value, beginning of period  $11.46   $10.06   $11.46   $11.46   $10.46   $10.00 
Activity from investment operations:                              
Net investment loss (2)   (0.09)   (0.11)   (0.03)   (0.09)   (0.06)   (0.08)
Net realized and unrealized gain / (loss) on investments   2.20    1.51    (1.02)   0.78    1.10    0.54 
Total from investment operations   2.11    1.40    (1.05)   0.69    1.04    0.46 
Less distributions from:                              
Net realized gains   —    —    (0.35)   (0.69)   (0.04)   — 
Total distributions   —    —    (0.35)   (0.69)   (0.04)   — 
Paid-in-Capital From Redemption Fees (2)(9)   0.00    0.00    0.00    0.00    0.00    0.00 
Net asset value, end of period  $13.57   $11.46   $10.06   $11.46   $11.46   $10.46 
Total return (3)   18.41% (7)   13.92%   (8.95)%   6.15%   9.97%   4.60% (7)
Net assets, at end of period (000s)  $14,332   $11,637   $12,104   $26,079   $24,709   $14,578 
Ratio of gross expenses to average net assets (4)(6)   2.45% (5)   2.60%   2.53%   2.36%   2.38%   2.47% (5)
Ratio of net expenses to average net assets (6)   2.24% (5)   2.24%   2.24%   2.24%   2.24%   2.24% (5)
Ratio of net investment loss to average net assets (6)(8)   (1.32)% (5)   (1.05)%   (0.31)%   (0.80)%   (0.56)%   (0.77)% (5)
Portfolio Turnover Rate   276% (7)   560%   607%   402%   337%   449% (7)

 

 

(1)The Pinnacle Sherman Multi-Strategy Core Fund’s Class C shares commenced operations on October 1, 2015.

 

(2)Per share amounts calculated using the average shares method, which more appropriately presents the per share data for the period.

  

(3)Total returns shown are historical in nature and assume changes in share price, reinvestment of dividends and distributions, if any, and exclude the effect of applicable sales charges and redemption fees. Had the adviser not waived fees and / or reimbursed a portion of its expenses, total returns would have been lower.

  

(4)Represents the ratio of expenses to average net assets absent fee waivers and/or expense reimbursements by the adviser.

  

(5)Annualized.

  

(6)Does not include the expenses of other investment companies in which the Fund invests.

  

(7)Not annualized.

 

(8)Recognition of net investment loss by the Fund is affected by the timing of declaration of dividends by the underlying investment companies in which the Fund invests.

 

(9)Amount represents less than $0.01 per share.

 

See Accompanying Notes to Financial Statements.

 

 

Pinnacle Sherman Multi-Strategy Core Fund

FINANCIAL HIGHLIGHTS

 

Per Share Data and Ratios for a Share of Beneficial Interest Outstanding Throughout Each Period Presented 

 

   Six Months Ended                     
   March 31, 2021   Year Ended   Year Ended   Year Ended   Year Ended   Period Ended 
Class I  (Unaudited)   September 30, 2020   September 30, 2019   September 30, 2018   September 30, 2017   September 30, 2016 (1) 
Net asset value, beginning of period  $11.92   $10.45   $11.77   $11.66   $10.57   $10.00 
Activity from investment operations:                              
Net investment income/(loss) (2)   (0.02)   (0.02)   0.07    0.02    0.05    0.01 
Net realized and unrealized gain / (loss) on investments   2.29    1.59    (1.04)   0.79    1.12    0.56(10)
Total from investment operations   2.27    1.57    (0.97)   0.81    1.17    0.57 
Less distributions from:                              
Net investment income   —    (0.10)   —    (0.01)   (0.04)   — 
Net realized gains   —    —    (0.35)   (0.69)   (0.04)   — 
Total distributions   —    (0.10)   (0.35)   (0.70)   (0.08)   — 
Paid-in-Capital From Redemption Fees (2)(9)   0.00    0.00    0.00    0.00    0.00    0.00 
Net asset value, end of period  $14.19   $11.92   $10.45   $11.77   $11.66   $10.57 
Total return (3)   19.04% (7)   15.10%   (8.01)%   7.16%   11.09%   5.70% (7)
Net assets, at end of period (000s)  $38,762   $35,793   $14,431   $50,191   $67,546   $27,240 
Ratio of gross expenses to average net assets (4)(6)   1.45% (5)   1.60%   1.53%   1.36%   1.38%   1.47% (5)
Ratio of net expenses to average net assets (6)   1.24% (5)   1.24%   1.24%   1.24%   1.24%   1.24% (5)
Ratio of net investment income/(loss) to average net assets (6)(8)   (0.35)% (5)   (0.17)%   0.67%   0.20%   0.47%   0.06% (5)
Portfolio Turnover Rate   276% (7)   560%   607%   402%   337%   449% (7)

 

 

(1)The Pinnacle Sherman Multi-Strategy Core Fund’s Class I shares commenced operations on October 1, 2015.

  

(2)Per share amounts calculated using the average shares method, which more appropriately presents the per share data for the period.

  

(3)Total returns shown are historical in nature and assume changes in share price, reinvestment of dividends and distributions, if any, and exclude the effect of applicable sales charges and redemption fees. Had the adviser not waived a portion of its fees and / or reimbursed expenses, total returns would have been lower.

  

(4)Represents the ratio of expenses to average net assets absent fee waivers and/or expense reimbursements by the adviser.

  

(5)Annualized.

  

(6)Does not include the expenses of other investment companies in which the Fund invests.

  

(7)Not annualized.

  

(8)Recognition of net investment income by the Fund is affected by the timing of declaration of dividends by the underlying investment companies in which the Fund invests.

  

(9)Amount represents less than $0.01 per share.

  

(10)Realized and unrealized gains and losses per share in this caption are balancing amounts necessary to reconcile the changes in net asset value per share for the period, and may not reconcile with the aggregate gains and losses in the Statement of Operations due to share transactions for the period.

 

See Accompanying Notes to Financial Statements.

 

 

Pinnacle TrendRating Innovative Equity Fund

FINANCIAL HIGHLIGHTS

 

Per Share Data and Ratios for a Share of Beneficial Interest Outstanding Throughout Each Period Presented

 

   Class A 
   Six Months Ended   Year Ended   Period Ended 
   March 31, 2021   September 30, 2020   September 30, 2019 (1) 
   (Unaudited)         
Net asset value, beginning of period  $12.77   $11.08   $10.00 
Activity from investment operations:               
Net investment loss (2)   (0.02)   (0.01)   (0.06)
Net realized and unrealized gain on investments   0.82    1.83    1.14 
Total from investment operations   0.80    1.82    1.08 
Less distributions from:               
Net realized gains   (0.25)   (0.13)   — 
Total distributions   (0.25)   (0.13)   — 
Net asset value, end of period  $13.32   $12.77   $11.08 
Total return (3)   6.28% (6)   16.52%   10.80% (6)
Net assets, at end of period  $899   $371   $5,256 
Ratio of gross expenses to average net assets (4)(7)   3.29% (5)   4.14%   13.38% (5)
Ratio of net expenses to average net assets (7)   1.24% (5)   1.24%   1.24% (5)
Ratio of net investment loss to average net assets (7)(8)   (0.31%) (5)   (0.30)%   (0.38)% (5)
Portfolio Turnover Rate   177% (6)   296%   149% (6)

 

 

(1)The Pinnacle TrendRating Innovative Equity Fund Class A, Class C and Class I shares commenced operations on December 3, 2018.

  

(2)Per share amounts calculated using the average shares method, which more appropriately presents the per share data for the period.

  

(3)Total returns shown are historical in nature and assume changes in share price, reinvestment of dividends and distributions, if any, and exclude the effect of applicable sales charges and redemption fees. Had the adviser not waived fees and / or reimbursed a portion of its expenses, total returns would have been lower.

  

(4)Represents the ratio of expenses to average net assets absent fee waivers and/or expense reimbursements by the adviser.

  

(5)Annualized.

  

(6)Not annualized.

  

(7)Does not include the expenses of other investment companies in which the Fund invests.

 

(8)Recognition of net investment income by the Fund is affected by the timing of declaration of dividends by the underlying investment companies in which the Fund invests.

 

See Accompanying Notes to Financial Statements.

 

 

Pinnacle TrendRating Innovative Equity Fund

FINANCIAL HIGHLIGHTS 

 

Per Share Data and Ratios for a Share of Beneficial Interest Outstanding Throughout Each Period Presented

 

   Class C 
   Six Months Ended   Year Ended   Period Ended 
   March 31, 2021   September 30, 2020   September 30, 2019 (1) 
   (Unaudited)         
Net asset value, beginning of period  $12.79   $11.08   $10.00 
Activity from investment operations:               
Net investment loss (2)   (0.01)   (0.01)   (0.06)
Net realized and unrealized gain on investments   0.81    1.85    1.14 
Total from investment operations   0.80    1.84    1.08 
Less distributions from:               
Net realized gains   (0.25)   (0.13)   — 
Total distributions   (0.25)   (0.13)   — 
Net asset value, end of period  $13.34   $12.79   $11.08 
Total return (3)   6.27% (6)   16.70%   10.80% (6)
Net assets, at end of period  $14   $13   $11 
Ratio of gross expenses to average net assets (4)(7)   4.04% (5)   4.89%   14.13% (5)
Ratio of net expenses to average net assets (7)   1.99% (5)   1.99%   1.99% (5)
Ratio of net investment loss to average net assets (7)(8)   (1.12%) (5)   (1.05)%   (1.13)% (5)
Portfolio Turnover Rate   177% (6)   296%   149% (6)

 

 

(1)The Pinnacle TrendRating Innovative Equity Fund Class A, Class C and Class I shares commenced operations on December 3, 2018.

  

(2)Per share amounts calculated using the average shares method, which more appropriately presents the per share data for the period.

  

(3)Total returns shown are historical in nature and assume changes in share price, reinvestment of dividends and distributions, if any, and exclude the effect of applicable sales charges and redemption fees. Had the adviser not waived fees and / or reimbursed a portion of its expenses, total returns would have been lower.

  

(4)Represents the ratio of expenses to average net assets absent fee waivers and/or expense reimbursements by the adviser.

  

(5)Annualized.

  

(6)Not annualized.

  

(7)Does not include the expenses of other investment companies in which the Fund invests.

  

(8)Recognition of net investment income by the Fund is affected by the timing of declaration of dividends by the underlying investment companies in which the Fund invests.

 

See Accompanying Notes to Financial Statements.

 

 

Pinnacle TrendRating Innovative Equity Fund

FINANCIAL HIGHLIGHTS 

Per Share Data and Ratios for a Share of Beneficial Interest Outstanding Throughout Each Period Presented

  

   Class I 
   Six Months Ended   Year Ended   Period Ended 
   March 31, 2021   September 30, 2020   September 30, 2019 (1) 
   (Unaudited)         
Net asset value, beginning of period  $12.80   $11.09   $10.00 
Activity from investment operations:               
Net investment loss (2)   (0.01)   (0.01)   (0.01)
Net realized and unrealized gain on investments   0.82    1.85    1.10 
Total from investment operations   0.81    1.84    1.09 
Less distributions from:               
Net investment income   (0.00) (7)   —    — 
Net realized gains   (0.25)   (0.13)   — 
Total distributions   (0.25)   (0.13)   — 
Net asset value, end of period  $13.36   $12.80   $11.09 
Total return (3)   6.37% (6)   16.69%   10.90% (6)
Net assets, at end of period (000s)  $6,469   $6,054   $1,974 
                
Ratio of gross expenses to average net assets (4)(8)   3.04% (5)   3.89%   13.13% (5)
Ratio of net expenses to average net assets (8)   0.99% (5)   0.99%   0.99% (5)
Ratio of net investment loss to average net assets (8)(9)   (0.12%) (5)   (0.05)%   (0.13)% (5)
Portfolio Turnover Rate   177% (6)   296%   149% (6)

 

 

(1)The Pinnacle TrendRating Innovative Equity Fund Class A, Class C and Class I shares commenced operations on December 3, 2018.

  

(2)Per share amounts calculated using the average shares method, which more appropriately presents the per share data for the period.

  

(3)Total returns shown are historical in nature and assume changes in share price, reinvestment of dividends and distributions, if any, and exclude the effect of applicable sales charges and redemption fees. Had the adviser not waived fees and / or reimbursed a portion of its expenses, total returns would have been lower.

  

(4)Represents the ratio of expenses to average net assets absent fee waivers and/or expense reimbursements by the adviser.

  

(5)Annualized.

  

(6)Not annualized.

 

(7)Amount represents less than $0.01 per share.

 

(8)Does not include the expenses of other investment companies in which the Fund invests.

 

(9)Recognition of net investment income by the Fund is affected by the timing of declaration of dividends by the underlying investment companies in which the Fund invests.

 

See Accompanying Notes to Financial Statements. 

 

 

PINNACLE FUNDS
NOTES TO FINANCIAL STATEMENTS (Unaudited)
March 31, 2021

 

1.ORGANIZATION

 

The Pinnacle Sherman Multi-Strategy Core Fund and Pinnacle TrendRating Innovative Equity Fund (each a “Fund” and collectively the “Funds”) are each a diversified series of shares of beneficial interest of Northern Lights Fund Trust III (the “Trust”), a Delaware statutory trust organized on December 5, 2011. Each Fund is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company. The investment objective of Pinnacle Sherman Multi-Strategy Core Fund is to seek high total return with reasonable risk. The investment objective of Pinnacle TrendRating Innovative Equity Fund is to seek high total return. Pinnacle Sherman Multi-Strategy Core Fund commenced operations on October 1, 2015. Pinnacle TrendRating Innovative Equity Fund commenced operations on December 3, 2018.

 

Each Fund currently offers Class A, Class C and Class I shares. Class C and Class I shares are offered at net asset value (“NAV”). Class A shares are offered at NAV plus a maximum sales charge of 5.75%. Each class represents an interest in the same assets of the Funds and classes are identical except for differences in their sales charge structures and ongoing service and distribution charges. All classes of shares have equal voting privileges except that each class has exclusive voting rights with respect to its service and/or distribution plans. The Funds’ income, expenses (other than class specific distribution fees) and realized and unrealized gains and losses are allocated proportionately each day based upon the relative net assets of each class.

 

2.SIGNIFICANT ACCOUNTING POLICIES

 

The following is a summary of significant accounting policies followed by the Funds in preparation of their financial statements. These policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of financial statements 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 income and expenses for the period. Actual results could differ from those estimates. Each Fund is an investment company and accordingly follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board Accounting Standards Codification Topic 946 “Financial Services – Investment Companies”, including Accounting Standards Update 2013-08.

 

Securities Valuation – Securities listed on an exchange are valued at the last reported sale price at the close of the regular trading session of the primary exchange on the business day the value is being determined or, in the case of securities listed on NASDAQ, at the NASDAQ Official Closing Price. In the absence of a sale, such securities shall be valued at the mean between the current bid and ask prices on the day of valuation. Short-term debt obligations having 60 days or less remaining until maturity, at time of purchase, may be valued at amortized cost.

 

The Funds may hold securities, such as private investments, interests in commodity pools, other non-traded securities or temporarily illiquid securities, for which market quotations are not readily available or are determined to be unreliable. These securities will be valued using the “fair value” procedures

 

 

PINNACLE FUNDS
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
March 31, 2021

 

approved by the Trust’s Board of Trustees (the “Board”) . The Board has delegated execution of these procedures to a fair value committee composed of one or more representatives from each of the (i) Trust, (ii) administrator, and (iii) adviser. The committee may also enlist third party consultants such as a valuation specialist at a public accounting firm, valuation consultant or financial officer of a security issuer on an as-needed basis to assist in determining a security-specific fair value. The Board reviews and ratifies the execution of this process and the resultant fair value prices at least quarterly to assure the process produces reliable results.

 

Fair Valuation Process – As noted above, the fair valuation committee is composed of one or more representatives from each of the (i) Trust, (ii) administrator, and (iii) adviser. The applicable investments are valued collectively via inputs from each of these groups. For example, fair value determinations are required for the following securities: (i) securities for which market quotations are insufficient or not readily available on a particular business day (including securities for which there is a short and temporary lapse in the provision of a price by the regular pricing source); (ii) securities for which, in the judgment of the adviser, the prices or values available do not represent the fair value of the instrument. Factors which may cause the adviser to make such a judgment include, but are not limited to, the following: only a bid price or an ask price is available; the spread between bid and ask prices is substantial; the frequency of sales; the thinness of the market; the size of reported trades; and actions of the securities markets, such as the suspension or limitation of trading; (iii) securities determined to be illiquid; and (iv) securities with respect to which an event that will affect the value thereof has occurred (a “significant event”) since the closing prices were established on the principal exchange on which they are traded, but prior to the Funds’ calculation of their NAVs. Specifically, interests in commodity pools or managed futures pools are valued on a daily basis by reference to the closing market prices of each futures contract or other asset held by a pool, as adjusted for pool expenses. Restricted or illiquid securities, such as private investments or non-traded securities are valued via inputs from the adviser based upon the current bid for the security from two or more independent dealers or other parties reasonably familiar with the facts and circumstances of the security (who should take into consideration all relevant factors as may be appropriate under the circumstances). If the adviser is unable to obtain a current bid from such independent dealers or other independent parties, the fair value committee shall determine the fair value of such security using the following factors: (i) the type of security; (ii) the cost at date of purchase; (iii) the size and nature of the Fund’s holdings; (iv) the discount from market value of unrestricted securities of the same class at the time of purchase and subsequent thereto; (v) information as to any transactions or offers with respect to the security; (vi) the nature and duration of restrictions on disposition of the security and the existence of any registration rights; (vii) how the yield of the security compares to similar securities of companies of similar or equal creditworthiness; (viii) the level of recent trades of similar or comparable securities; (ix) the liquidity characteristics of the security; (x) current market conditions; and (xi) the market value of any securities into which the security is convertible or exchangeable.

 

Cash and Cash Equivalents – Cash and cash equivalents includes cash and overnight investments in interest-bearing demand deposits with a financial institution with original maturities of three months or less. The assets of the Funds may be placed in deposit accounts at U.S. banks and such deposits generally exceed Federal Deposit Insurance Corporation (“FDIC”) insurance limits. The FDIC insures deposit accounts up to $250,000 for each accountholder. The counterparty is generally a single bank

 

 

PINNACLE FUNDS
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
March 31, 2021

 

or other financial institution, rather than a group of financial institutions; thus there may be a greater counterparty credit risk. The Funds place deposits only with those counterparties which are believed to be creditworthy. As of March 31, 2021, the Pinnacle TrendRating Innovative Equity Fund had deposits with MUFG Union Bank of $82,588 representing 1.28% of net assets.

 

Valuation of Underlying Funds – The Funds may invest in portfolios of open-end or closed-end investment companies (the “underlying funds”). Underlying open-end investment companies are valued at their respective NAVs as reported by such investment companies. The underlying funds value securities in their portfolios for which market quotations are readily available at their market values (generally the last reported sale price) and all other securities and assets at their fair value by the methods established by the board of trustees of the underlying funds. The shares of many closed-end investment companies, after their initial public offering, frequently trade at a price per share, which is different than the NAV per share. The difference represents a market premium or market discount of such shares. There can be no assurances that the market discount or market premium on shares of any closed-end investment company purchased by a Fund will not change.

 

The Funds utilize various methods to measure the fair value of all of their investments on a recurring basis. GAAP establishes a hierarchy that prioritizes inputs to valuation methods. The three levels of inputs are:

 

Level 1 – Unadjusted quoted prices in active markets for identical assets and liabilities that a Fund has the ability to access.

 

Level 2 – Observable inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument in an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data.

 

Level 3 – Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available, representing a Fund’s own assumptions about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available.

 

The availability of observable inputs can vary from security to security and is affected by a wide variety of factors, including, for example, the type of security, whether the security is new and not yet established in the marketplace, the liquidity of markets, and other characteristics particular to the security. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in Level 3.

 

The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement falls in its entirety, is determined based on the lowest level input that is significant to the fair value measurement in its entirety.

 

 

PINNACLE FUNDS
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
March 31, 2021

 

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. The following tables summarize the inputs used as of March 31, 2021 for the Funds’ investments measured at fair value:

 

Pinnacle Sherman Multi-Strategy Core Fund 
                 
Assets *  Level 1   Level 2   Level 3   Total 
Common Stock  $15,031,545   $—   $—   $15,031,545 
Exchange Traded Funds - Equity   33,219,853    —    —    33,219,853 
Time Deposit   16,909,833    —    —    16,909,833 
Total  $65,161,231   $—   $—   $65,161,231 
                     
Pinnacle TrendRating Innovative Equity Fund 
                 
Assets *  Level 1   Level 2   Level 3   Total 
Common Stock  $6,397,970   $—   $—   $6,397,970 
Total  $6,397,970   $—   $—   $6,397,970 

 

The Funds did not hold any Level 3 securities during the period.

 

*Refer to the Portfolio of Investments for classification by asset class.

 

Security Transactions and Related Income – Investment security transactions are accounted for on a trade date basis. Cost is determined and gains and losses are based upon the specific identification method for both financial statement and federal income tax purposes. Dividend income is recorded on the ex-dividend date and interest income is recorded on an accrual basis. Purchase discounts and premiums on securities are accreted and amortized over the life of the respective securities using the effective interest method.

 

Dividends and Distributions to Shareholders – Dividends from net investment income, if any, are declared and paid annually. Distributable net realized capital gains, if any, are declared and distributed annually. Dividends from net investment income and distributions from net realized gains are determined in accordance with federal income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either temporary (e.g., deferred losses) or permanent in nature. To the extent these differences are permanent in nature, such amounts are reclassified within the composition of net assets based on their federal tax-basis treatment; temporary differences do not require reclassification. Any such reclassifications will have no effect on net assets, results from operations, or net asset value per share of a Fund. Dividends and distributions to shareholders are recorded on the ex-dividend date.

 

Federal Income Taxes – The Funds comply with the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its taxable income to its shareholders. Therefore, no provision for federal income tax is required. The Funds recognize the tax benefits of uncertain tax positions only where the position is “more likely than not” to be sustained assuming examination by tax authorities. Management has analyzed the Funds’ tax positions and has concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions for the period ended September 30, 2018 to September 30, 2020 for the Funds or expected to be taken in the Funds’ September 30, 2021 year-end tax returns. The Funds identify their major tax

 

 

PINNACLE FUNDS
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
March 31, 2021

 

jurisdictions as U.S. federal, Ohio (Nebraska in years prior to 2019) and foreign jurisdictions where a Fund makes significant investments; however, each Fund is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next twelve months. The Funds recognize interest and penalties if any, related to unrecognized tax benefits as income tax expense in the Statements of Operations. During the period, the Funds did not incur any interest or penalties.

 

Exchange Traded Funds – The Funds may invest in exchange traded funds (“ETFs”). ETFs are a type of fund bought and sold on a securities exchange. An ETF trades like common stock and may be actively managed or represent a fixed portfolio of securities. The risks of owning an ETF generally reflect the risks of owning the underlying securities in which they invest, although the lack of liquidity on an ETF could result in it being more volatile. Additionally, ETFs have fees and expenses that reduce their value.

 

Expenses – Expenses of the Trust that are directly identifiable to a specific fund are charged to that fund. Expenses, which are not readily identifiable to a specific fund, are allocated in such a manner as deemed equitable (as determined by the Board), taking into consideration the nature and type of expense and the relative sizes of the funds in the Trust.

 

Indemnification – The Trust indemnifies its officers and trustees for certain liabilities that may arise from the performance of their duties to the Trust. Additionally, in the normal course of business, the Funds enter into contracts that contain a variety of representations and warranties and which provide general indemnities. The Funds’ maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Funds that have not yet occurred. However, based on experience, the risk of loss due to these warranties and indemnities appears to be remote.

 

3.INVESTMENT TRANSACTIONS

 

For the six months ended March 31, 2021, cost of purchases and proceeds from sales of portfolio securities, other than short-term investments and U.S. government securities, amounted to the following:

 

Fund  Purchases   Sales 
Pinnacle Sherman Multi-Strategy Core Fund  $139,530,723   $155,935,224 
Pinnacle TrendRating Innovative Equity Fund   11,063,155    11,007,013 

 

 

PINNACLE FUNDS
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
March 31, 2021

 

4.REDEMPTION FEES

 

The Funds may assess a short-term redemption fee of 1.00% of the total redemption amount if a shareholder sells their shares after holding them for less than 60 days. The redemption fee is paid directly to the Funds. For the six months ended March 31, 2021, the redemption fees paid to the Funds were as follows:

 

Pinnacle Sherman Multi-Strategy Core Fund

 

   Redemption Fee 
Class A  $124 
Class C   1 
Class I   2,524 

 

5.INVESTMENT ADVISORY AGREEMENT AND TRANSACTIONS WITH RELATED PARTIES

 

Pinnacle Family Advisors, LLC serves as the Funds’ investment adviser (the “Adviser”).

 

Pursuant to an Advisory Agreement with the Trust on behalf of the Funds, the Adviser, under the oversight of the Board, directs the daily operations of the Funds and supervises the performance of administrative and professional services provided by others. As compensation for its services and the related expenses borne by the Adviser, the Funds pay the Adviser a management fee, computed and accrued daily and paid monthly, at an annual rate of 1.00% of the average daily net assets of Pinnacle Sherman Multi-Strategy Core Fund, and 0.75% of the average daily net assets of Pinnacle TrendRating Innovative Equity Fund paid monthly. For the six months ended March 31, 2021, Pinnacle Sherman Multi-Strategy Core Fund, and Pinnacle TrendRating Innovative Equity Fund incurred $292,407, and $24,142 in advisory fees respectively.

 

Pursuant to a written contract (the “Waiver Agreement”), the Adviser has agreed, at least until July 31, 2022 for Pinnacle Sherman Multi-Strategy Core Fund and at least until January 31, 2022 for the Pinnacle TrendRating Innovative Equity Fund, to waive a portion of its advisory fees and has agreed to reimburse the Funds for other expenses to the extent necessary so that the total expenses incurred by the Funds (excluding front-end or contingent deferred loads, brokerage fees and commissions, acquired fund fees and expenses, borrowing costs such as interest and dividend expenses on securities sold short, taxes, or extraordinary expenses, such as litigation, not incurred in the ordinary course of the Funds’ business) do not exceed 1.49% per annum of Class A average daily net assets, 2.24% per annum for Class C average daily net assets, and 1.24% per annum for Class I average daily net assets for Pinnacle Sherman Multi- Strategy Core Fund; and 1.24% per annum of Class A average daily net assets, 1.99% per annum for Class C average daily net assets, and 0.99% per annum for Class I average daily net assets for Pinnacle TrendRating Innovative Equity Fund (the “expense limitation”).

 

If the Adviser waives any fee or reimburses any expense pursuant to the Waiver Agreement, and a Fund’s operating expenses attributable to Class A, Class C and Class I shares are subsequently less

 

 

PINNACLE FUNDS
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
March 31, 2021

 

than the expense limitation, the Adviser shall be entitled to reimbursement by the applicable Fund for such waived fees or reimbursed expenses provided that such reimbursement does not cause the Fund’s expenses to exceed the lesser of the expense limitation in place at the time of the waiver or at the time of the reimbursement. If the operating expenses attributable to the Class A, Class C and Class I shares subsequently exceed the expense limitation then in place or in place at time of waiver, the reimbursements shall be suspended. The Adviser may seek recoupment only for expenses waived or paid by it during the three years prior to such reimbursement; provided, however, that such expenses may only be reimbursed to the extent they were waived or paid after the date of the Waiver Agreement (or any similar agreement). The Board may terminate this expense reimbursement arrangement at any time. For the six months ended March 31, 2021, the Adviser waived and/or reimbursed $59,695 and $66,021 for the Pinnacle Sherman Multi-Strategy Core Fund and Pinnacle TrendRating Innovative Equity Fund, respectively in advisory fees or expenses pursuant to the Waiver Agreement.

 

The following amounts are subject to recapture until the following dates:

 

   9/30/2021   9/30/2022   9/30/2023 
Pinnacle Sherman Multi-Strategy Core Fund  $131,985   $162,100   $136,108 
Pinnacle TrendRating Innovative Equity Fund   —    116,003    127,954 

 

Distributor – The Trust, on behalf of the Funds, has adopted the Trust’s Class A and Class C Master Distribution and Shareholder Servicing Plans (the “Plans”) pursuant to Rule 12b-1 under the 1940 Act. The Plans provide that a monthly service and/or distribution fee is calculated by the Funds at an annual rate of 0.25% and 1.00% of the average daily net assets attributable to Class A shares and Class C shares, respectively, and is paid to Northern Lights Distributors, LLC (“the “Distributor”), to provide compensation for ongoing distribution-related activities or services and/or maintenance of the Funds’ shareholder accounts, not otherwise required to be provided by the Adviser. Pursuant to the Plans, the Funds incurred distribution fees during the six months ended March 31, 2021 as follows:

 

   Class A   Class C 
Pinnacle Sherman Multi-Strategy Core Fund  $12,865   $66,450 
Pinnacle TrendRating Innovative Equity Fund   1    — 

 

The Distributor acts as the Funds’ principal underwriter in a continuous public offering of the Funds’ shares. For the six months ended March 31, 2021, the Distributor received $60,847 from front-end sales charge of which $8,924 was retained by the principal underwriter or other affiliated broker-dealers for Pinnacle Multi-Strategy Core Fund Class A. The underwriter received no commissions for the Pinnacle TrendRating Innovative Equity Fund.

 

 

PINNACLE FUNDS
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
March 31, 2021

 

In addition, certain affiliates of the Distributor provide services to the Funds as follows:

 

Gemini Fund Services, LLC (“GFS”) – GFS, an affiliate of the Distributor, provides administration, fund accounting, and transfer agent services to the Trust. Pursuant to separate servicing agreements with GFS, the Funds pay GFS customary fees for providing administration, fund accounting and transfer agency services to each Fund. Certain officers of the Trust are also officers of GFS, and are not paid any fees directly by the Funds for serving in such capacities.

 

Northern Lights Compliance Services, LLC (“NLCS”) – NLCS, an affiliate of GFS and the Distributor, provides a Chief Compliance Officer to the Trust, as well as related compliance services, pursuant to a consulting agreement between NLCS and the Trust. Under the terms of such agreement, NLCS receives customary fees from the Funds.

 

Blu Giant LLC (“Blu Giant”) – Blu Giant, an affiliate of GFS and the Distributor, provides EDGAR conversion and filing services as well as print management services for the Funds on an ad-hoc basis. For the provision of these services, Blu Giant receives customary fees from the Funds.

 

6.CONTROL 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. Persons controlling the Funds can determine the outcome of any proposal submitted to the shareholders for approval, including changes to the Funds’ fundamental policies or the terms of the advisory agreement with the Adviser. As of March 31, 2021, the following held in excess of 25% of the voting securities of the Funds listed, for the sole benefit of customers and may be deemed to control the relevant Fund:

 

      Percentage of Voting Securities as of
Fund  Shareholder  March 31, 2021
Pinnacle Sherman Multi-Strategy Core Fund  LPL Financial  27.9%
Pinnacle TrendRating Innovative Equity Fund  National Financial Services LLC  77.6%

 

7.DISTRIBUTIONS TO SHAREHOLDERS AND TAX COMPONENTS OF CAPITAL

 

The identified cost of investments in securities owned by each Fund for federal income tax purposes, and their respective unrealized appreciation and depreciation at March 31, 2021, were as follows:

 

   Cost for   Gross   Gross   Tax Net 
   Federal Tax   Unrealized   Unrealized   Unrealized 
Fund  purposes   Appreciation   Depreciation   Appreciation 
Pinnacle Sherman Multi -Strategy Core  $59,774,327   $6,149,422   $(762,518)  $5,386,904 
Pinnacle TrendRating Innovative Equity Fund   6,039,882    658,888    (300,800)   358,088 

 

 

PINNACLE FUNDS
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
March 31, 2021

 

The tax character of fund distributions paid for the year ended September 30, 2020 and September 30, 2019 was as follows:

 

   For the year ended September 30, 2020 
   Ordinary   Long-Term   Return of     
Fund  Income   Capital Gains   Capital   Total 
Pinnacle Sherman Multi-Strategy Core Fund  $139,004   $—   $447   $139,451 
Pinnacle Trend Rating Innovative Equity Fund   29,901    —    —    29,901 
                     
   For the year/period ended September 30, 2019 
   Ordinary   Long-Term   Return of     
Fund  Income   Capital Gains   Capital   Total 
Pinnacle Sherman Multi-Strategy Core Fund  $1,580,031   $933,142   $—   $2,513,173 
Pinnacle Trend Rating Innovative Equity Fund   —    —    —    — 

 

As of September 30, 2020, the components of accumulated earnings/(losses) on a tax basis were as follows:

 

   Undistributed   Undistributed   Capital Loss   Other   Post October Loss   Unrealized   Total 
   Ordinary   Long-Term   Carry   Book/Tax   and   Appreciation/   Accumulated 
Fund  Income   Capital Gains   Forwards   Differences   Late Year Loss   (Losses)   Earnings/(Losses) 
Pinnacle Sherman Multi-Strategy Core Fund  $—   $—   $(3,501,552)  $—   $—   $5,312,893   $1,811,341 
Pinnacle Trend Rating Innovative Equity Fund   778    8,037    —    —    (4,555)   705,417   $709,677 

 

The difference between book basis and tax basis accumulated net realized gain/(loss), and unrealized appreciation/(depreciation) from investments is primarily attributable to the tax deferral of losses on wash sales.

 

Late year losses incurred after December 31 within the fiscal year are deemed to arise on the first business day of the following fiscal year for tax purposes. The Pinnacle Trend Rating Innovative Equity Fund incurred and elected to defer such late year losses of $4,555.

 

At September 30, 2020, the Funds had capital loss carry forwards for federal income tax purposes available to offset future capital gains, as follows:

 

   Non-Expiring   Non-Expiring     
Fund  Short-Term   Long-Term   Total 
Pinnacle Sherman Multi-Strategy Core Fund  $3,501,552   $—   $3,501,552 
Pinnacle Trend Rating Innovative Equity Fund   —    —    — 

 

As a result of the acquisition of another Fund, the Pinnacle Sherman Multi-Strategy Fund acquired $1,604,716 of short- term capital loss carryover, which is available to offset future capital gains. As a result of a change in control due to the merger, these capital losses are subject to an annual limitation of $141,535 (prorated in the initial year) under IRC Section 382.

 

 

PINNACLE FUNDS
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
March 31, 2021

 

Permanent book and tax differences, primarily attributable to the tax treatment of the Funds net operating losses and the target fund’s capital loss carryforward acquired as a result of a merger, resulted in reclassifications for the year ended September 30, 2020 as follows:

 

   Paid   Accumulated 
   In   Earnings/ 
Fund  Capital   (Losses) 
Pinnacle Sherman Multi-Strategy Core Fund  $1,455,898   $(1,455,898)
Pinnacle Trend Rating Innovative Equity Fund   —    — 

 

8.FUND REORGANIZATION

 

The Board, after careful consideration, approved the reorganization of the Pinnacle Sherman Tactical Allocation Fund into the Pinnacle Sherman Multi -Strategy Core Fund. The plan of the reorganization provided for the transfer of all the assets and the presumption of the liabilities of the Pinnacle Sherman Tactical Allocation Fund. The following table illustrates the specifics of the reorganization that occurred on March 27, 2020. The reorganization qualified as a tax-free “reorganization” under the Internal Revenue Code of 1986, as amended (the ‘Code” for U.S. federal income tax purposes). The Pinnacle Sherman Tactical Allocation Fund’s securities were recorded at fair value, however the cost basis of the investments received from the Fund were carried forward to align ongoing reporting of the Fund’s realized and unrealized gains and losses with amounts distributable for tax purposes.

 

Pinnacle Funds Pre Merger  Pinnacle Funds Post Merger
   Pinnacle Sherman Tactical Allocation Fund      Pinnacle Sherman Tactical Allocation Fund 
   Shares   Net Assets      Shares   Net Assets 
Class A   370,955   $3,452,626   Class A   —   $— 
Class C   62,245    557,691   Class C   —    — 
Class I   500,364    4,672,797   Class I   —    — 
Total   933,564   $8,683,114   Total   —   $— 
                        
   Pinnacle Sherman Multi-Strategy Core Fund      Pinnacle Sherman Multi-Strategy Core Fund 
   Shares   Net Assets      Shares   Net Assets 
Class A   400,898   $3,868,989   Class A   758,654   $7,321,615 
Class C   1,005,024    9,424,650   Class C   1,064,495    9,982,341 
Class I   1,126,894    10,932,984   Class I   1,608,532    15,605,781 
Total   2,532,816   $24,226,623   Total   3,431,681   $32,909,737 

 

 

PINNACLE FUNDS
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
March 31, 2021

 

Because the combined investment portfolios have been managed as a single integrated portfolio since the reorganization was completed, it is not practicable to separate the amounts of revenue and earnings of the Pinnacle Sherman Tactical Allocation Fund that have been included in the Pinnacle Sherman Multi-Strategy Core Fund’s Statement of Operations since March 27, 2020. The Pinnacle Sherman Tactical Allocation Fund had the below capital loss carry forwards for federal income tax purposes available to offset future capital gains, as follows:

 

    Non-Expiring   Non-Expiring     
Expiring   Short-Term   Long-Term   Total 
$—   $970,321   $—   $970,321 

 

Assuming the Reorganization had been completed on March 27, 2020, the Pinnacle Sherman Multi-Strategy Core Fund’s pro forma results of operations for the year ended September 30, 2020, are as follows:

 

Pro Forma (unaudited)     
Net Investment Loss  $(114,270)
Net Realized and Unrealized Gain on Investments   5,664,377 
Net Increase in Net Assets Resulting from Operations  $5,550,107 

 

9.SUBSEQUENT EVENTS

 

Subsequent events after the date of the Statements of Assets and Liabilities have been evaluated through the date the financial statements were issued. Management has determined that no events or transactions occurred requiring adjustment or disclosure in the financial statements.

 

 

PINNACLE FUNDS
EXPENSE EXAMPLES (Unaudited)
March 31, 2021

 

As a shareholder of a Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchases of Class A shares; (2) ongoing costs, including management fees; distribution and/or service (12b-1) fees; and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in a 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 from October 1, 2020 through March 31, 2021.

 

Actual Expenses

 

The “Actual” columns in the table below provide information about actual account values and actual expenses. You may use the information below, 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 table 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 “Hypothetical” columns in the table below provide information about hypothetical account values and hypothetical expenses based on each Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balances or expenses you paid for the period. You may use this information to compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of 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) or redemption fees. Therefore, the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

 

                 Hypothetical  
           Actual*  (5% return before expenses)  
        Beginning              
     Fund’s  Account  Ending  Expenses  Ending  Expenses  
     Annualized  Value  Account Value  Paid During  Account Value  Paid During  
     Expense Ratio  10/1/20  3/31/21  Period  3/31/21  Period  
  Pinnacle Sherman Multi-Strategy Core Fund – Class A  1.49%  $1,000.00  $1,188.30  $   8.13  $1,017.50  $   7.49  
  Pinnacle Sherman Multi-Strategy Core Fund – Class C  2.24%  $1,000.00  $1,184.10  $ 12.20  $1,013.76  $ 11.25  
  Pinnacle Sherman Multi-Strategy Core Fund – Class I  1.24%  $1,000.00  $1,190.40  $   6.77  $1,018.75  $   6.24  
  Pinnacle TrendRating Innovative Equity Fund – Class A  1.24%  $1,000.00  $1,062.80  $   6.38  $1,018.75  $   6.24  
  Pinnacle TrendRating Innovative Equity Fund – Class C  1.99%  $1,000.00  $1,062.70  $ 10.23  $1,015.01  $ 10.00  
  Pinnacle TrendRating Innovative Equity Fund – Class I  0.99%  $1,000.00  $1,063.70  $   5.09  $1,020.00  $   4.99  

 

*Expenses are equal to the average account value over the period, multiplied by a Fund’s annualized expense ratio, multiplied by the number of days in the period (182) divided by the number of days in the fiscal year (365).

 

 

PRIVACY NOTICE

 

Rev. February 2014

 

FACTS WHAT DOES NORTHERN LIGHTS FUND TRUST III DO WITH YOUR PERSONAL INFORMATION?
   
Why? Financial companies choose how they share your personal information. Federal law gives consumers the right to limit some but not all sharing. Federal law also requires us to tell you how we collect, share, and protect your personal information. Please read this notice carefully to understand what we do.
   
What? The types of personal information we collect and share depend on the product or service you have with us. This information can include:
   
   ■ Social Security number ■ Purchase History
         
  ■ Assets ■ Account Balances
         
  ■ Retirement Assets ■ Account Transactions
         
  ■ Transaction History ■ Wire Transfer Instructions
         
  ■ Checking Account Information    
   
  When you are no longer our customer, we continue to share your information as described in this notice.
   
How? All financial companies need to share customers’ personal information to run their everyday business. In the section below, we list the reasons financial companies can share their customers’ personal information; the reasons Northern Lights Fund Trust III chooses to share; and whether you can limit this sharing.

  

Reasons we can share your personal information Does Northern
Lights Fund
Trust III share?		 Can you limit this
sharing?

For our everyday business purposes –

such as to process your transactions, maintain your account(s), respond to court orders and legal investigations, or report to credit bureaus

 Yes No

For our marketing purposes –

to offer our products and services to you

 No We don’t share
For joint marketing with other financial companies No We don’t share

For our affiliates’ everyday business purposes –

information about your transactions and experiences

 No We don’t share

For our affiliates’ everyday business purposes –

information about your creditworthiness

 No We don’t share
For nonaffiliates to market to you No We don’t share

 

Questions? Call (402) 493-4603

 

 

Who we are

Who is providing this notice?

 

Northern Lights Fund Trust III

What we do
How does Northern Lights Fund Trust III protect my personal information?

To protect your personal information from unauthorized access and use, we use security measures that comply with federal law. These measures include computer safeguards and secured files and buildings.

 

Our service providers are held accountable for adhering to strict policies and procedures to prevent any misuse of your nonpublic personal information.

How does Northern Lights Fund Trust III collect my personal information?

We collect your personal information, for example, when you

 

■    Open an account

 

■    Provide account information

 

■    Give us your contact information

 

■    Make deposits or withdrawals from your account

 

■    Make a wire transfer

 

■    Tell us where to send the money

 

■    Tells us who receives the money

 

■    Show your government-issued ID

 

■    Show your driver’s license

 

We also collect your personal information from other companies.

Why can’t I limit all sharing?

Federal law gives you the right to limit only

 

■    Sharing for affiliates’ everyday business purposes – information about your creditworthiness

■    Affiliates from using your information to market to you

 

■    Sharing for nonaffiliates to market to you

 

State laws and individual companies may give you additional rights to limit sharing.

Definitions
Affiliates

Companies related by common ownership or control. They can be financial and nonfinancial companies.

 

■    Northern Lights Fund Trust III does not share with our affiliates.

Nonaffiliates

Companies not related by common ownership or control. They can be financial and nonfinancial companies  

■    Northern Lights Fund Trust III does not share with nonaffiliates so they can market to you.

Joint marketing

A formal agreement between nonaffiliated financial companies that together market financial products or services to you.

 

■    Northern Lights Fund Trust III doesn’t jointly market.

 

 

PROXY VOTING POLICY

 

Information regarding how the Funds voted proxies relating to portfolio securities for the most recent 12 month period ended June 30 as well as a description of the policies and procedures that the Funds used to determine how to vote proxies is available without charge, upon request, by calling 1-888-985-9830 or by referring to the Securities and Exchange Commission’s (“SEC”) website at http://www.sec.gov.

 

PORTFOLIO HOLDINGS

 

The Funds file their complete schedules of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form NPORT. Form NPORT is available on the SEC’s website at http://www.sec.gov. The information on Form NPORT is available without charge, upon request, by calling 1-888-985-9830.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

INVESTMENT ADVISER
Pinnacle Family Advisors, LLC
620 W. Republic Road, Ste. 104
Springfield, MO 65807
 
ADMINISTRATOR
Gemini Fund Services, LLC
4221 North 203rd Street, Suite 100
Elkhorn, NE 68022-3474

 

 

 

 

 

 

 

PINNACLE-SA21

 

 

Item 2. Code of Ethics.

 

Not applicable for semi-annual reports.

 

Item 3. Audit Committee Financial Expert.

 

Not applicable for semi-annual reports.

 

Item 4. Principal Accountant Fees and Services.

 

Not applicable for semi-annual reports.

 

Item 5. Audit Committee of Listed Companies. Not applicable to open-end investment companies.

 

Item 6. Schedule of Investments. Schedule of investments in securities of unaffiliated issuers is included under Item 1.

 

Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Funds. 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 Funds. Not applicable to open-end investment companies.

 

Item 10. Submission of Matters to a Vote of Security Holders. None

 

Item 11. Controls and Procedures.

 

(a)       Based on an evaluation of the Registrant’s disclosure controls and procedures as of a date within 90 days of filing date of this Form N-CSR, the principal executive officer and principal financial officer of the Registrant have concluded that the disclosure controls and procedures of the Registrant are reasonably designed to ensure that the information required in filings on Form N-CSR is recorded, processed, summarized, and reported by the filing date, including that information required to be disclosed is accumulated and communicated to the Registrant’s management, including the Registrant’s principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.

 

(b)       There were no significant changes in the Registrant’s internal control over financial reporting that occurred during the Registrant’s last fiscal half-year that have materially affected, or are reasonably likely to materially affect, the Registrant’s internal control over financial reporting.

 

Item 12. Disclosure of Securities Lending Activities for Closed-End Management Investment Companies. Not applicable to open-end investment companies.

 

Item 13. Exhibits.

 

(a)(1) Code of Ethics filed herewith.

 

(a)(2) Certifications required by Section 302 of the Sarbanes-Oxley Act of 2002 (and Item 11(a)(2) of Form N-CSR) are filed herewith.

 

(a)(3) Not applicable for open-end investment companies.

 

(b)       Certifications required by Section 906 of the Sarbanes-Oxley Act of 2002 (and Item 11(b) of Form N-CSR) are filed 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) Northern Lights Fund Trust III

 

By (Signature and Title)

/s/ Rich Malinowski

Rich Malinowski, Principal Executive Officer/President

 

Date 6/4/21

 

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/ Rich Malinowski

Rich Malinowski, Principal Executive Officer/President

 

Date 6/4/21

 

 

By (Signature and Title)

/s/ Brian Curley

Brian Curley, Principal Financial Officer/Treasurer

 

Date 6/4/21