N-CSRS 1 d917775dncsrs.htm ADVISORS INNER CIRCLE FUND Advisors Inner Circle Fund

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM N-CSRS

 

 

CERTIFIED SHAREHOLDER REPORT OF REGISTERED

MANAGEMENT INVESTMENT COMPANIES

Investment Company Act file number 811-06400

 

 

The Advisors’ Inner Circle Fund

(Exact name of registrant as specified in charter)

 

 

101 Federal Street

Boston, MA 02110

(Address of principal executive offices) (Zip code)

 

 

SEI Investments

One Freedom Valley Drive

Oaks, PA 19456

(Name and address of agent for service)

 

 

Registrant’s telephone number, including area code: 1-877-446-3863

Date of fiscal year end: October 31, 2015

Date of reporting period: April 30, 2015

 

 

 


Item 1. Reports to Stockholders.


LOGO


THE ADVISORS’ INNER CIRCLE FUND    THOMSON HORSTMANN &
   BRYANT MICROCAP FUND
   APRIL 30, 2015
   (Unaudited)

 

 

 

 

TABLE OF CONTENTS       

Schedule of Investments

    1   

Statement of Assets and Liabilities

    6   

Statement of Operations

    7   

Statements of Changes

    8   

Financial Highlights

    9   

Notes to Financial Statements

    11   

Disclosure of Fund Expenses

    19   

Board Considerations in Re-Approving the Advisory Agreement

    21   

The Fund files its complete schedule of investments of fund holdings with the Securities and Exchange Commission (“SEC”) for the first and third quarters of each fiscal year on Form N-Q within sixty days after period end. The Fund’s Forms N-Q are available on the SEC’s website at http://www.sec.gov, and may be reviewed and copied at the SEC’s Public Reference Room in Washington, DC. Information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330.

A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to Fund securities, as well as information relating to how a Fund voted proxies relating to Fund securities during the most recent 12-month period ended June 30, is available (i) without charge, upon request, by calling 1-855-842-3863; and (ii) on the SEC’s website at http://www.sec.gov.


THE ADVISORS’ INNER CIRCLE FUND    THOMSON HORSTMANN &
   BRYANT MICROCAP FUND
   APRIL 30, 2015
   (Unaudited)

 

 

 

SECTOR WEIGHTINGS†

 

LOGO

 

    Percentages based on total investments.

 

SCHEDULE OF INVESTMENTS

 

               
COMMON STOCK — 97.1%                
    Shares         Value  

CONSUMER DISCRETIONARY — 20.4%

     

Arctic Cat

    15,990        $ 567,485   

Black Diamond *

    72,000          648,720   

Callaway Golf

    222,840         2,157,091   

Del Frisco’s Restaurant Group *

    39,217         791,007   

Diversified Restaurant Holdings *

    29,264         106,814   

iRobot *

    28,190         913,920   

Jamba *

    47,548         749,356   

Johnson Outdoors, Cl A

    26,754         842,751   

Luby’s *

    185,000         980,500   

Marine Products

    55,300         392,630   

Nautilus *

    51,617         867,682   

Overstock.com *

    37,917         814,078   

Rave Restaurant Group *

    10,916         152,606   

Skullcandy *

    2,420         26,160   

Spartan Motors

    154,400         727,224   

Stoneridge *

    37,900         456,316   

Strattec Security

    7,344         551,314   

Superior Industries International

    30,527          567,802   

Universal Electronics *

    15,520          837,149   

 

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

 

1


THE ADVISORS’ INNER CIRCLE FUND    THOMSON HORSTMANN &
   BRYANT MICROCAP FUND
   APRIL 30, 2015
   (Unaudited)

 

 

 

COMMON STOCK — continued                
    Shares         Value  

CONSUMER DISCRETIONARY — (continued)

     

WCI Communities *

    68,820       $ 1,600,065   

Winnebago Industries

    9,910         205,236   
     

 

 

 
        14,955,906   
     

 

 

 

CONSUMER STAPLES — 0.4%

     

Liberator Medical Holdings

    104,291         294,101   
     

 

 

 

ENERGY — 9.6%

     

Aegean Marine Petroleum Network

    42,944         652,749   

Era Group *

    53,481         1,186,208   

Evolution Petroleum

    90,036         619,448   

Matrix Service *

    26,180         575,175   

McDermott International *

    39,960         209,790   

Natural Gas Services Group *

    16,130         408,895   

Panhandle Oil and Gas, Cl A

    7,275         165,870   

Renewable Energy Group *

    80,920         745,273   

RigNet *

    16,100         603,106   

Ring Energy *

    57,338         696,083   

Synergy Resources *

    61,661         738,699   

Tidewater

    14,920         413,135   
     

 

 

 
        7,014,431   
     

 

 

 

FINANCIALS — 17.3%

     

AMERISAFE

    12,900         582,951   

Ashford Hospitality Prime (A)

    25,300         396,198   

Avenue Financial Holdings *

    17,608         208,655   

Beneficial Bancorp *

    69,600         807,360   

Bluerock Residential Growth, Cl A (A)

    36,590         500,551   

CatchMark Timber Trust, Cl A (A)

    95,380         1,106,408   

City Office (A)

    34,267         442,387   

First Busey

    75,600         471,744   

First Security Group *

    269,950         647,880   

Fox Chase Bancorp

    49,080         816,201   

Heritage Oaks Bancorp

    47,732          380,424   

Independent Bank Group

    16,400          631,400   

Levy Acquisition *

    34,756         501,529   

 

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

 

2


THE ADVISORS’ INNER CIRCLE FUND    THOMSON HORSTMANN &
   BRYANT MICROCAP FUND
   APRIL 30, 2015
   (Unaudited)

 

 

 

COMMON STOCK — continued                
    Shares         Value  

FINANCIALS — (continued)

     

Metro Bancorp

    40,913       $ 1,049,009   

MutualFirst Financial

    60,100         1,295,155   

Old Second Bancorp *

    54,409         320,197   

Park Sterling

    156,100         1,045,870   

SI Financial Group

    74,288         896,656   

Southern National Bancorp of Virginia

    49,010         578,318   
     

 

 

 
        12,678,893   
     

 

 

 

HEALTH CARE — 9.8%

     

AngioDynamics *

    25,376          423,525   

AtriCure *

    42,060         925,740   

AxoGen *

    79,070         268,838   

BioScrip *

    138,500         650,950   

BioTelemetry *

    77,774         622,970   

CryoLife

    9,874         100,715   

Cynosure, Cl A *

    11,933         398,801   

Enzo Biochem *

    61,120         171,136   

Harvard Bioscience *

    11,282         62,615   

HealthStream *

    10,885         315,012   

Icad *

    35,532         324,052   

NeoGenomics *

    179,826         814,612   

Sharps Compliance *

    81,203         510,767   

Streamline Health Solutions *

    98,245         222,033   

Trinity Biotech ADR

    49,930         837,326   

Vascular Solutions *

    17,330         555,600   
     

 

 

 
        7,204,692   
     

 

 

 

INDUSTRIALS — 21.9%

     

Argan

    22,340          721,805   

CECO Environmental

    79,900         942,021   

Celadon Group

    13,839         357,600   

Comfort Systems USA

    47,203          976,630   

Echo Global Logistics *

    25,027         723,280   

FreightCar America

    36,661          956,486   

GP Strategies *

    10,050         327,530   

 

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

 

3


THE ADVISORS’ INNER CIRCLE FUND    THOMSON HORSTMANN &
   BRYANT MICROCAP FUND
   APRIL 30, 2015
   (Unaudited)

 

 

 

COMMON STOCK — continued                
    Shares         Value  

INDUSTRIALS — (continued)

     

Graham

    25,998       $ 608,353   

Great Lakes Dredge & Dock *

    42,962         249,180   

Hill International *

    22,698         87,387   

Hurco

    38,843         1,256,960   

Insteel Industries

    61,860         1,253,284   

Jason Industries Inc *

    34,607         254,188   

Kadant

    5,340         272,126   

LB Foster, Cl A

    23,810         1,017,401   

Lydall *

    17,380         466,479   

Manitex International *

    26,949         267,065   

Marten Transport

    11,850         263,781   

Miller Industries

    6,550         146,589   

MYR Group *

    21,630         634,192   

NN

    59,500         1,497,020   

PMFG *

    168,400         747,696   

Preformed Line Products

    8,417         353,093   

SIFCO Industries

    55,200         804,264   

Sparton *

    19,309         497,593   

Ultralife *

    100,443         409,807   
     

 

 

 
        16,091,810   
     

 

 

 

INFORMATION TECHNOLOGY — 12.8%

     

Actua Corp *

    47,570         688,338   

Alliance Fiber Optic Products

    19,680         361,325   

Brightcove *

    11,047         76,445   

CalAmp *

    16,320         321,667   

Callidus Software *

    60,603         748,447   

Computer Task Group

    5,123         42,162   

Datawatch *

    42,550         311,040   

DSP Group *

    54,060          615,203   

eGain *

    97,578          317,128   

Extreme Networks *

    251,250          633,150   

Fabrinet *

    10,524          190,590   

Information Services Group

    55,861         219,534   

IntraLinks Holdings *

    68,160         667,968   

 

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

 

4


THE ADVISORS’ INNER CIRCLE FUND    THOMSON HORSTMANN &
   BRYANT MICROCAP FUND
   APRIL 30, 2015
   (Unaudited)

 

 

 

COMMON STOCK — continued                
    Shares         Value  

INFORMATION TECHNOLOGY — (continued)

     

Iteris *

    168,500       $ 298,245   

Marchex, Cl B

    37,493         159,345   

On Track Innovations *

    87,647         120,953   

PAR Technology *

    40,451         165,849   

Perceptron

    8,462         103,067   

Pericom Semiconductor

    6,965         87,202   

PRGX Global *

    13,310         56,434   

Qumu *

    55,200         762,312   

Seachange International *

    95,646         641,785   

Stamps.com *

    1,910         118,210   

Telenav *

    67,880         567,477   

Upland Software *

    12,886         79,378   

Xcerra *

    67,358         662,129   

Zix *

    91,280         388,853   
     

 

 

 
        9,404,236   
     

 

 

 

MATERIALS — 3.6%

     

AEP Industries *

    24,871         1,246,037   

Olympic Steel

    32,610         357,080   

US Concrete *

    27,920         1,013,496   
     

 

 

 
        2,616,613   
     

 

 

 

UTILITIES — 1.3%

     

Consolidated Water

    79,191         951,084   
     

 

 

 

TOTAL COMMON STOCK

     

(Cost $70,745,620)

        71,211,766   
     

 

 

 
     
SHORT-TERM INVESTMENT (B) — 1.1%                

SEI Daily Income Trust Government Fund, Cl A, 0.02%
(Cost $809,830)

    809,830          809,830   
     

 

 

 

TOTAL INVESTMENTS — 98.2%

     

(Cost $71,555,450)

      $ 72,021,596   
     

 

 

 

 

   Percentages are based on Net Assets of $73,373,202.
* Non-income producing security.
(A) Real Estate Investment Trust
(B) Rate shown is the 7-day effective yield as of April 30, 2015.

ADR American Depositary Receipt

Cl —Class

 

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

 

5


THE ADVISORS’ INNER CIRCLE FUND    THOMSON HORSTMANN &
   BRYANT MICROCAP FUND
   APRIL 30, 2015
   (Unaudited)

 

 

 

STATEMENT OF ASSETS AND LIABILITIES      

Assets:

 

Investments, at Value (Cost $71,555,450)

  $         72,021,596   

Receivable for Investment Securities Sold

    2,220,401   

Receivable for Capital Shares Sold

    87,410   

Dividend and Interest Receivable

    19,767   

Prepaid Expenses

    25,743   
 

 

 

 

Total Assets

    74,374,917   
 

 

 

 

Liabilities:

 

Payable for Investment Securities Purchased

    866,067   

Payable due to Investment Adviser

    44,675   

Payable for Capital Shares Redeemed

    23,105   

Payable due to Administrator

    11,507   

Payable due to Trustees

    5,389   

Chief Compliance Officer Fees Payable

    3,769   

Payable due to Shareholder Servicing Agent

    838   

Distribution Fees Payable

    790   

Other Accrued Expenses and Other Payables

    45,575   
 

 

 

 

Total Liabilities

    1,001,715   
 

 

 

 

Net Assets

  $ 73,373,202   
 

 

 

 
 
NET ASSETS CONSIST OF:      

Paid-in-Capital

  $ 72,467,384   

Accumulated Net Investment Loss

    (175,930

Accumulated Net Realized Gain on Investments

    615,602   

Net Unrealized Appreciation on Investments

    466,146   
 

 

 

 

Net Assets

  $ 73,373,202   
 

 

 

 

Net Asset Value, Offering and Redemption Price Per Share*-

 

Institutional Class Shares (unlimited authorization - no par value)
($69,625,600 ÷ 5,183,387 shares)

  $ 13.43   
 

 

 

 

Net Asset Value, Offering and Redemption Price Per Share*-

 

Investor Class Shares (unlimited authorization - no par value)
($3,747,602 ÷ 282,271 shares)

  $ 13.28   
 

 

 

 

 

* Redemption price per share may vary depending on the length of time shares are held.

 

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

 

6


THE ADVISORS’ INNER CIRCLE FUND    THOMSON HORSTMANN &
   BRYANT MICROCAP FUND
   FOR THE SIX MONTHS ENDED
   APRIL 30, 2015
   (Unaudited)

 

 

 

STATEMENT OF OPERATIONS      

Investment Income:

 

Dividends

  $ 298,741   
 

 

 

 

Total Investment Income

    298,741   
 

 

 

 

Expenses:

 

Investment Advisory Fees

            463,310   

Administration Fees

    69,424   

Trustees’ Fees

    9,305   

Distribution Fees (Investor Class Shares)

    5,674   

Shareholder Serving Fees (Investor Class Shares)

    5,674   

Chief Compliance Officer Fees

    5,292   

Transfer Agent Fees

    44,183   

Registration and Filing Fees

    18,209   

Legal Fees

    17,723   

Printing Fees

    13,612   

Audit Fees

    10,909   

Custodian Fees

    2,480   

Other Expenses

    11,396   
 

 

 

 

Total Expenses

    677,191   
 

 

 

 

Less:

 

Waiver of Investment Advisory Fees

    (202,511

Fees Paid Indirectly — Note 4

    (9
 

 

 

 

Net Expenses

    474,671   
 

 

 

 

Net Investment Loss

    (175,930
 

 

 

 

Net Realized Gain Investments

    850,636   

Net Change in Unrealized Appreciation (Depreciation) on Investments

    (2,301,330
 

 

 

 

Net Realized and Unrealized Loss on Investments

    (1,450,694
 

 

 

 

Net Decrease in Net Assets Resulting from Operations

  $ (1,626,624
 

 

 

 

 

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

 

7


THE ADVISORS’ INNER CIRCLE FUND    THOMSON HORSTMANN &
   BRYANT MICROCAP FUND

 

 

 

STATEMENTS OF CHANGES IN NET ASSETS                
    Six-Months
Ended
April 30, 2015
(Unaudited)
        Year
Ended
October 31,
2014
 

Operations:

     

Net Investment Loss

  $ (175,930     $ (394,599

Net Realized Gain on Investments

    850,636          4,747,793   

Net Change in Unrealized Appreciation (Depreciation) on Investments

    (2,301,330       (5,706,603
 

 

 

     

 

 

 

Net Decrease in Net Assets Resulting From Operations

    (1,626,624       (1,353,409
 

 

 

     

 

 

 

Dividends and Distributions to Shareholders:

     

Net Capital Gains

     

Institutional

    (4,268,605       (962,549

Investor

    (302,507       (30,622
 

 

 

     

 

 

 

Total Dividends and Distributions to Shareholders

    (4,571,112       (993,171
 

 

 

     

 

 

 

Capital Share Transactions:(1)

     

Institutional Class Shares

     

Issued

    11,674,697          22,869,753   

Reinvestment of Distributions

    1,834,585          955,539   

Redeemed

    (8,447,289       (7,205,039
 

 

 

     

 

 

 

Net Institutional Class Share Transactions

    5,061,993          16,620,253   
 

 

 

     

 

 

 

Investor Class Shares

     

Issued

    310,733          5,924,871   

Reinvestment of Distributions

    301,426          30,571   

Redemption Fees — Note 2

    380            

Redeemed

    (1,643,800       (2,066,876
 

 

 

     

 

 

 

Net Investor Share Class Transactions

    (1,031,261       3,888,566   
 

 

 

     

 

 

 

Net Increase in Net Assets From Capital Share Transactions

    4,030,732          20,508,819   
 

 

 

     

 

 

 

Total Increase (Decrease) in Net Assets

    (2,167,004       18,162,239   

Net Assets:

     

Beginning of Period

    75,540,206          57,377,967   
 

 

 

     

 

 

 

End of Period (including accumulated net investment loss of
($175,930) and $—, respectively)

  $ 73,373,202        $ 75,540,206   
 

 

 

     

 

 

 

 

(1) For share transactions, see Note 6 in the Notes to Financial Statements.

Amount designated as “—” is $0.

 

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

 

8


THE ADVISORS’ INNER CIRCLE FUND    THOMSON HORSTMANN &
   BRYANT MICROCAP FUND

 

 

 

FINANCIAL HIGHLIGHTS

Selected Per Share Date & Ratios

For a Share Outstanding Throughout the Year or Period

 

     Institutional Class Shares  
     Period
Ended
April 30,
2015
(Unaudited)
    Year
Ended
October  31,
2014
    Year
Ended
October  31,
2013
    Period
Ended
October 31,
2012‡
 

Net Asset Value, Beginning of Period

   $ 14.60      $ 14.90      $ 10.34      $ 10.00   
  

 

 

   

 

 

   

 

 

   

 

 

 

Income (Loss) from Investment Operations:

        

Net Investment Loss*

     (0.03     (0.08     (0.08     (0.03

Net Realized and Unrealized Gain (Loss)

     (0.27     0.03 **      4.74        0.37   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total from Investment Operations

     (0.30     (0.05     4.66        0.34   
  

 

 

   

 

 

   

 

 

   

 

 

 

Dividends and Distributions:

        

Net Investment Income

                   (0.04       

Capital Gains

     (0.87     (0.25     (0.06       
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Dividends and Distributions

     (0.87     (0.25     (0.10       
  

 

 

   

 

 

   

 

 

   

 

 

 

Net Asset Value, End of Period

   $ 13.43      $ 14.60      $ 14.90      $ 10.34   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Return†

     (2.17 )%      (0.38 )%      45.44     3.40
  

 

 

   

 

 

   

 

 

   

 

 

 

Ratios and Supplemental Data

        

Net Assets, End of Period (Thousands)

   $ 69,626      $ 70,343      $ 55,741      $ 1,382   

Ratio of Expenses to Average Net Assets(1)

     1.25 %††      1.25     1.25     1.25 %†† 

Ratio of Expenses to Average Net Assets (Excluding Waivers and Reimbursements)

     1.79 %††      1.80     2.65     72.09 %†† 

Ratio of Net Investment Loss to Average
Net Assets

     (0.45 )%††      (0.52 )%      (0.64 )%      (0.49 )%†† 

Portfolio Turnover Rate

     48     57     36     17 %^ 

 

* Per share calculations were performed using average shares for the period.
** The amount shows for a share outstanding throughout the period does not accord with the aggregate net losses on investments for the period because of the sales and repurchase of Fund shares in relation to fluctuating market value of the investments of the Fund.
Total return is for the period indicated and has not been annualized. Returns shown do not reflect the deductions of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. Total return would have been lower had the Advisor not waived its fee and reimbursed other expenses.
†† Annualized.
^ Portfolio turnover rate is for the period indicated and has not been annualized.
Commenced operations on March 30, 2012.
(1) The ratio of net expenses to average net assets includes the effects of fees paid indirectly. If these expense offsets were excluded, the ratios would have been the same.

Amount designated as “—” is $0.

 

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

 

9


THE ADVISORS’ INNER CIRCLE FUND    THOMSON HORSTMANN &
   BRYANT MICROCAP FUND

 

 

 

FINANCIAL HIGHLIGHTS

Selected Per Share Date & Ratios

For a Share Outstanding Throughout the Year or Period

 

     Investor Class Shares  
     Period
Ended
April 30,
2015
(Unaudited)
    Year
Ended
October 31,
2014
    Year
Ended
October 31,
2013
    Period
Ended
October 31,
2012‡
 

Net Asset Value, Beginning of Period

   $ 14.47      $ 14.85      $ 10.33      $ 10.00   
  

 

 

   

 

 

   

 

 

   

 

 

 

Income (Loss) from Investment Operations:

        

Net Investment Loss*

     (0.06     (0.16     (0.15     (0.05

Net Realized and Unrealized Gain (Loss)

     (0.26     0.03 **      4.75        0.38   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total from Investment Operations

     (0.32     (0.13     4.60        0.33   
  

 

 

   

 

 

   

 

 

   

 

 

 

Redemption Fees

     0.00 (1)             0.00 (1)        
  

 

 

   

 

 

   

 

 

   

 

 

 

Dividends and Distributions:

        

Net Investment Income

                   (0.02       

Capital Gains

     (0.87     (0.25     (0.06       
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Dividends and Distributions

     (0.87     (0.25     (0.08       
  

 

 

   

 

 

   

 

 

   

 

 

 

Net Asset Value, End of Period

   $ 13.28      $ 14.47      $ 14.85      $ 10.33   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Return†

     (2.34 )%      (0.93 )%      44.81     3.30
  

 

 

   

 

 

   

 

 

   

 

 

 

Ratios and Supplemental Data

        

Net Assets, End of Period (Thousands)

   $ 3,747      $ 5,197      $ 1,637      $ 58   

Ratio of Expenses to Average Net Assets(1)

     1.75 %††      1.75     1.75     1.55 %†† 

Ratio of Expenses to Average Net Assets (Excluding Waivers and Reimbursements)

     2.29 %††      2.31     3.73     331.49 %†† 

Ratio of Net Investment Loss to Average Net Assets

     (0.91 )%††      (1.06 )%      (1.12 )%      (0.88 )%†† 

Portfolio Turnover Rate

     48     57     36     17 %^ 

 

* Per share calculations were performed using average shares for the period.
** The amount shows for a share outstanding throughout the period does not accord with the aggregate net losses on investments for the period because of the sales and repurchase of Fund shares in relation to fluctuating market value of the investments of the Fund.
Total return is for the period indicated and has not been annualized. Returns shown do not reflect the deductions of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. Total return would have been lower had the Advisor not waived its fee and reimbursed other expenses.
†† Annualized.
^ Portfolio turnover rate is for the period indicated and has not been annualized.
Commenced operations on March 30, 2012.
(1) Amount represents less than $0.01 per share.
(2) The ratio of net expenses to average net assets includes the effects of fees paid indirectly. If these expense offsets were excluded, the ratios would have been the same.

Amount designated as “—” is $0.

 

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

 

10


THE ADVISORS’ INNER CIRCLE FUND    THOMSON HORSTMANN &
   BRYANT MICROCAP FUND
   APRIL 30, 2015
   (Unaudited)

 

 

 

NOTES TO FINANCIAL STATEMENTS

1. Organization:

The Advisors’ Inner Circle Fund (the “Trust”) is organized as a Massachusetts business trust under an Amended and Restated Agreement and Declaration of Trust dated February 18, 1997. The Trust is registered under the Investment Company Act of 1940, as amended, as an open-end management investment company with 54 funds. The financial statements herein are those of the Thomson Horstmann & Bryant Microcap Fund (the “Fund”). The investment objective of the Fund is capital appreciation. The Fund is diversified and invests primarily (at least 80% of its net assets) in equity securities of micro-capitalization companies. The financial statements of the remaining funds of the Trust are presented separately. The assets of each fund are segregated, and a shareholder’s interest is limited to the fund in which shares are held.

2. Significant Accounting Policies:

The following is a summary of the Significant Accounting Policies followed by the Fund.

Use of Estimates — The Fund is an investment company in conformity with U.S. generally accepted accounting principles (“U.S. GAAP”). Therefore, the Fund follows the accounting and reporting guidelines for investment companies. The preparation of financial statements, in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates and such differences could be material.

Security Valuation — Securities listed on a securities exchange, market or automated quotation system for which quotations are readily available (except for securities traded on NASDAQ), including securities traded over the counter, are valued at the last quoted sale price on the primary exchange or market (foreign or domestic) on which they are traded, or, if there is no such reported sale, at the most recent quoted bid price. For securities traded on NASDAQ, the NASDAQ Official Closing Price will be used. The short-term investment is valued at net asset value.

 

11


THE ADVISORS’ INNER CIRCLE FUND    THOMSON HORSTMANN &
   BRYANT MICROCAP FUND
   APRIL 30, 2015
   (Unaudited)

 

 

 

Securities for which market prices are not “readily available” are valued in accordance with fair value procedures established by the Fund’s Board of Trustees (the “Board”). The Fund’s fair value procedures are implemented through a fair value committee (the “Committee”) designated by the Board. Some of the more common reasons that may necessitate that a security be valued using fair value procedures include: the security’s trading has been halted or suspended; the security has been de-listed from a national exchange; the security’s primary trading market is temporarily closed at a time when under normal conditions it would be open; the security has not been traded for an extended period of time; the security’s primary pricing source is not able or willing to provide a price; or trading of the security is subject to local government imposed restrictions. When a security is valued in accordance with the fair value procedures, the Committee will determine the value after taking into consideration relevant information reasonably available to the Committee. As of April 30, 2015, there were no securities valued in accordance with the fair value procedures.

In accordance with the authoritative guidance on fair value measurements and disclosure under U.S. GAAP, the Fund discloses fair value of its investments in a hierarchy that prioritizes the inputs to valuation techniques used to measure the fair value. The objective of a fair value measurement is to determine the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (an exit price). Accordingly, the fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3).The three levels of the fair value hierarchy are described below:

 

   

Level 1 — Unadjusted quoted prices in active markets for identical, unrestricted assets or liabilities that the Fund has the ability to access at the measurement date;

 

   

Level 2 — Other significant observable inputs (includes quoted prices for similar securities, interest rates, prepayment speeds, credit risk, referenced indices, quoted prices in inactive markets, adjusted quoted prices in active markets, adjusted quoted prices on foreign equity securities that were adjusted in accordance with pricing procedures approved by the Board, etc.); and

 

12


THE ADVISORS’ INNER CIRCLE FUND    THOMSON HORSTMANN &
   BRYANT MICROCAP FUND
   APRIL 30, 2015
   (Unaudited)

 

 

 

 

   

Level 3 — Prices, inputs or exotic modeling techniques which are both significant to the fair value measurement and unobservable (supported by little or no market activity).

Investments are classified within the level of the lowest significant input considered in determining fair value. Investments classified within Level 3 whose fair value measurement considers several inputs may include Level 1 or Level 2 inputs as components of the overall fair value measurement.

As of April 30, 2015, all of the Fund’s investments were considered Level 1. For details of investment classifications, reference the Schedule of Investments.

For the period ended April 30, 2015, there have been no transfers between Level 1 and Level 2 assets and liabilities. During the period ended April 30, 2015, there were no Level 3 securities.

During the period ended April 30, 2015, there have been no significant changes to the Fund’s fair valuation methodologies.

Federal Income Taxes — It is the Fund’s intention to continue to qualify as a regulated investment company for Federal income tax purposes by complying with the appropriate provisions of Subchapter M of the Internal Revenue Code of 1986, as amended. Accordingly, no provisions for Federal income taxes have been made in the financial statements.

The Fund evaluates tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether it is “more-likely than-not” (i.e., greater than 50-percent) that each tax position will be sustained upon examination by a taxing authority based on the technical merits of the position. Tax positions not deemed to meet the more-likely-than-not threshold are recorded as a tax benefit or expense in the current year. The Fund did not record any tax provision in the current period. However, management’s conclusions regarding tax positions taken may be subject to review and adjustment at a later date based on factors including, but not limited to, examination by tax authorities (i.e., the last 3 year ends, as applicable), on-going analysis of and changes to tax laws, regulations and interpretations thereof.

As of and during the period ended April 30, 2015, the Fund did not have a liability for any unrecognized tax benefits. The Fund recognizes interest and penalties, if any, related to unrecognized tax benefits as income tax expense in the Statement of Operations. During the period ended April 30, 2015, the Fund did not incur any interest or penalties.

 

13


THE ADVISORS’ INNER CIRCLE FUND    THOMSON HORSTMANN &
   BRYANT MICROCAP FUND
   APRIL 30, 2015
   (Unaudited)

 

 

 

Security Transactions and Investment Income — Security transactions are accounted for on trade date for financial reporting purposes. Costs used in determining realized gains and losses on the sale of investment securities are based on specific identification. Dividend income is recorded on the ex-dividend date. Interest income is recognized on the accrual basis from settlement date.

Expenses — Expenses that are directly related to the Fund are charged to the Fund. Other operating expenses of the Trust are prorated to the Fund based on number of funds and/or relative net assets.

Classes — Class specific expenses are borne by that class of shares. Income, realized and unrealized gains (losses), and non-class specific expenses are allocated to the respective class on the basis of relative daily net assets.

Dividends and Distributions to Shareholders — The Fund distributes its net investment income, if any quarterly. Any net realized capital gains are distributed at least annually. All distributions are recorded on ex-dividend date.

Redemption Fees — The Fund retains redemption fees of 2.00% on redemptions of fund shares held for less than 30 days. For the period ended April 30, 2015 the Fund retained redemption fees of $380.

3. Transactions with Affiliates:

Certain officers of the Trust are also officers of SEI Investments Global Funds Services (the “Administrator”), a wholly owned subsidiary of SEI Investments Company, and/or SEI Investments Distribution Co. (the “Distributor”). Such officers are paid no fees by the Trust, other than the Chief Compliance Officer (“CCO”) as described below, for serving as officers of the Trust.

A portion of the services provided by the CCO and his staff, whom are employees of the Administrator, are paid for by the Trust as incurred. The services include regulatory oversight of the Trust’s Advisors and service providers as required by SEC regulations. The CCO’s services and fees have been approved by and are reviewed by the Board.

4. Administration, Distribution, Shareholder Servicing, Custodian and Transfer Agent Agreements:

The Fund and the Administrator are parties to an Administration Agreement, under which the Administrator provides administrative services to the Fund. For these

 

14


THE ADVISORS’ INNER CIRCLE FUND    THOMSON HORSTMANN &
   BRYANT MICROCAP FUND
   APRIL 30, 2015
   (Unaudited)

 

 

 

services, the Administrator is paid an asset based fee, which will vary depending on the number of share classes and the average daily net assets of the Fund. For the period ended April 30, 2015, the Fund paid $69,424 for these services.

The Trust and the Distributor are parties to a Distribution Agreement. The Distributor receives no fees under the agreement.

The Fund has entered into shareholder servicing agreements with third-party service providers pursuant to which the service providers provide certain shareholder services to Fund shareholders (the “Service Plan”). Under the Service Plan, the Fund may pay service providers a fee at a rate of up to 0.25% annually of the average daily net assets attributable to Investor Class Shares, subject to the arrangement for provision of shareholder and administrative services. For the period ended April 30, 2015, the Fund’s Investor Shares incurred $5,674 of shareholder servicing fees, an effective rate of 0.25%.

The Fund has adopted a distribution plan under Rule 12b-1 under the 1940 Act for Investor Class Shares that allows the Fund to pay distribution and service fees for the sale and distribution of its shares, and for services provided to shareholders. The maximum annual distribution fee for Investor Class Shares of the Fund is 0.25% of average daily net assets. For the period ended April 30, 2015, the Fund’s Investor Shares incurred $5,674 of distribution fees, an effective rate of 0.25%.

DST Systems, Inc. serves as the transfer agent and dividend disbursing agent for the Fund under a transfer agency agreement with the Trust. During the period ended April 30, 2015, the Fund earned cash management credits of $9, which were used to offset transfer agent expenses. This amount is labeled as “Fees Paid Indirectly” on the Statement of Operations.

MUFG Union Bank, N.A. acts as custodian (the “Custodian”) for the Fund. The Custodian plays no role in determining the investment policies of the Fund or which securities are to be purchased or sold by the Fund.

5. Investment Advisory Agreement:

Under the terms of an investment advisory agreement, Thomson Horstmann & Bryant, Inc. (the “Adviser”) provides investment advisory services to the Fund at a fee calculated at an annual rate of 1.25% of the Fund’s average daily net assets. The Adviser has contractually agreed to waive fees and reimburse expenses in order to keep Total Annual Fund Operating Expenses after Fee Waivers and/or Expense Reimbursements (excluding interest, taxes, brokerage commissions, Acquired Fund Fees and Expenses, and extraordinary expenses) (collectively “excluded expenses”)

 

15


THE ADVISORS’ INNER CIRCLE FUND    THOMSON HORSTMANN &
   BRYANT MICROCAP FUND
   APRIL 30, 2015
   (Unaudited)

 

 

 

from exceeding 1.25% and 1.75% of the Fund’s Institutional Class and Investor Class Shares’ average daily net assets, respectively, until March 29, 2016. In addition, if at any point it becomes unnecessary for the Adviser to reduce fees and make expense reimbursements, the Adviser may retain the difference between the Total Annual Fund Operating Expenses (less excluded expenses) and 1.25% and 1.75% for the Institutional Class Shares and Investor Class Shares, respectively, to recapture all or a portion of its prior fee reductions and expense reimbursements made during the preceding three-year period. This Agreement may be terminated: (i) by the Board, for any reason at any time; or (ii) by the Adviser, upon ninety (90) days’ prior written notice to the Trust, effective as of the close of business on March 29, 2016. As of April 30, 2015, fees which were previously waived and/or reimbursed by the Adviser which may be subject to possible future reimbursement, up to the expense cap in place at the time the fees were waived, to the Adviser were $431,474, expiring in 2016, $382,706 expiring in 2017 and $404,060 expiring in 2018. During the period ended April 30, 2015, there has been no recoupment of previously waived and reimbursed fees.

6. Share Transactions:

 

      Six Months
Ended
April 30,
2015
(Unaudited)
    Year Ended
October 31,
2014
 

Share Transactions:

    

Institutional Class Shares

    

Issued

     847,738        1,507,643   

Reinvested

     134,500        64,607   

Redeemed

     (618,337     (493,207
  

 

 

   

 

 

 

Net Institutional Share Transactions

     363,901        1,079,043   
  

 

 

   

 

 

 

Investor Class Shares

    

Issued

     22,782        387,023   

Reinvested

     22,328        2,075   

Redeemed

     (121,993     (140,157
  

 

 

   

 

 

 

Net Investor Share Transactions

     (76,883     248,941   
  

 

 

   

 

 

 

7. Investment Transactions:

For the period ended April 30, 2015, the Fund made purchases of $35,169,554 and sales of $36,061,109 in investment securities other than long-term U.S. Government and short-term securities. There were no purchases or sales of long-term U.S. Government securities.

 

16


THE ADVISORS’ INNER CIRCLE FUND    THOMSON HORSTMANN &
   BRYANT MICROCAP FUND
   APRIL 30, 2015
   (Unaudited)

 

 

 

8. Federal Tax Information:

The amount and character of income and capital gain distributions to be paid, if any, are determined in accordance with Federal income tax regulations, which may differ from U.S. GAAP. As a result, net investment income (loss) and net realized gain (loss) on investment transactions for a reporting period may differ significantly from distributions during such period. These book/tax differences may be temporary or permanent. To the extent these differences are permanent in nature, they are charged or credited to undistributed net investment income (loss), accumulated net realized gain (loss) or paid-in capital, as appropriate, in the period that the differences arise.

The tax character of dividends and distributions declared during the last two fiscal years was as follows:

 

    Ordinary
Income
    Long Term
Capital Gain
    Total  
2014   $ 842,325      $ 150,846      $ 993,171   
2013     13,250               13,250   

As of October 31, 2014, the components of Distributable Earnings on a tax basis were as follows:

 

Undistributed Ordinary Income

   $ 1,719,313   

Undistributed Long-Term Capital Gain

     2,851,283   

Unrealized Appreciation

     2,532,957   

Other Temporary Differences

     1   
  

 

 

 

Total Distributable Earnings

   $ 7,103,554   
  

 

 

 

The Federal tax cost and aggregate gross unrealized appreciation and depreciation for the investments held by the Fund at April 30, 2015, were as follows:

 

Federal Tax
Cost

    Aggregate Gross
Unrealized
Appreciation
    Aggregate Gross
Unrealized
Depreciation
    Net
Unrealized
Appreciation
 
$ 71,555,450      $ 6,786,010      ($ 6,319,864   $ 466,146   

9. Other:

At April 30, 2015, 79% of the Institutional Class Shares total shares outstanding were held by two record shareholders and 90% of the Investor Class Shares total shares outstanding were held by two record shareholders. These shareholders were comprised of omnibus accounts that were held on behalf of multiple underlying shareholders.

 

17


THE ADVISORS’ INNER CIRCLE FUND    THOMSON HORSTMANN &
   BRYANT MICROCAP FUND
   APRIL 30, 2015
   (Unaudited)

 

 

 

In the normal course of business, the Fund enters into contracts that provide general indemnifications. The Fund’s maximum exposure under these arrangements is dependent on future claims that may be made against the Fund and, therefore, cannot be established; however, based on experience, the risk of loss from such claim is considered remote.

10. New Accounting Pronouncement:

In May 2015, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2015-07 regarding “Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share”. The amendments in this update are effective for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. ASU No. 2015-07 will eliminate the requirement to categorize investments in the fair value hierarchy if their fair value is measured at net asset value (NAV) per share (or its equivalent) using the practical expedient in the FASB’s fair value measurement guidance. At this time, management is evaluating the implications of ASU No. 2015-07 and its impact on the financial statement disclosures has not yet been determined.

11. Subsequent Events:

Management has evaluated the need for additional disclosures and/or adjustments resulting from subsequent events through the date the financial statements were issued. Based on this evaluation, no additional disclosures and/or adjustments were required to the financial statements.

 

18


THE ADVISORS’ INNER CIRCLE FUND    THOMSON HORSTMANN &
   BRYANT MICROCAP FUND
   APRIL 30, 2015
   (Unaudited)

 

 

 

DISCLOSURE OF FUND EXPENSES

All mutual funds have operating expenses. As a shareholder of a mutual fund, your investment is affected by these ongoing costs, which include (among others) costs for Fund management, administrative services, and shareholder reports like this one. It is important for you to understand the impact of these costs on your investment returns.

Operating expenses such as these are deducted from the mutual fund’s gross income and directly reduce your final investment return. These expenses are expressed as a percentage of the mutual fund’s average net assets; this percentage is known as the mutual fund’s expense ratio.

The following examples use the expense ratio and are intended to help you understand the ongoing costs (in dollars) of investing in your Fund and to compare these costs with those of other mutual funds. The examples are based on an investment of $1,000 made at the beginning of the period and held for the entire period from November 1, 2014 to April 30, 2015.

The table on the next page illustrates your Fund’s costs in two ways:

Actual Fund Return. This section helps you to estimate the actual expenses after fee waivers that your Fund incurred over the period. The “Expenses Paid During Period” column shows the actual dollar expense cost incurred by a $1,000 investment in the Fund, and the “Ending Account Value” number is derived from deducting that expense cost from the Fund’s gross investment return.

You can use this information, together with the actual amount you invested in the Fund, to estimate the expenses you paid over that period. Simply divide your ending starting account value by $1,000 to arrive at a ratio (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply that ratio by the number shown for your Fund under “Expenses Paid During Period.”

Hypothetical 5% Return. This section helps you compare your Fund’s costs with those of other mutual funds. It assumes that the Fund had an annual 5% return before expenses during the period, but that the expense ratio (Column 3) for the period is unchanged. This example is useful in making comparisons because the Securities and Exchange Commission requires all mutual funds to make this 5% calculation. You can assess your Fund’s comparative cost by comparing the hypothetical result for your Fund in the “Expense Paid During Period” column with those that appear in the same charts in the shareholder reports for other mutual funds.

Note: Because the return is set at 5% for comparison purposes — NOT your Fund’s actual return — the account values shown may not apply to your specific investment.

 

19


THE ADVISORS’ INNER CIRCLE FUND    THOMSON HORSTMANN &
   BRYANT MICROCAP FUND
   APRIL 30, 2015
   (Unaudited)

 

 

 

DISCLOSURE OF FUND EXPENSES — concluded
      Beginning
Account
Value
11/01/14
     Ending
Account
Value 4/30/15
     Annualized
Expense
Ratios
    Expenses Paid
During Period*
 

Actual Fund Return

          

Institutional Class

   $ 1,000.00       $ 978.30         1.25   $ 6.13   

Investor Class

     1,000.00         976.60         1.75        8.58   

Hypothetical 5% Return

          

Institutional Class

   $ 1,000.00       $ 1,018.60         1.25   $ 6.26   

Investor Class

     1,000.00         1,016.12         1.75        8.75   

 

* Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period.)

 

20


THE ADVISORS’ INNER CIRCLE FUND    THOMSON HORSTMANN &
   BRYANT MICROCAP FUND
   APRIL 30, 2015
   (Unaudited)

 

 

 

BOARD CONSIDERATIONS IN RE-APPROVING THE ADVISORY AGREEMENT

Pursuant to Section 15 of the Investment Company Act of 1940 (the “1940 Act”), the Fund’s advisory agreement (the “Agreement”) must be renewed after its initial two-year term: (i) by the vote of the Board of Trustees (the “Board” or the “Trustees”) of The Advisors’ Inner Circle Fund (the “Trust”) or by a vote of a majority of the shareholders of the Fund; and (ii) by the vote of a majority of the Trustees who are not parties to the Agreement or “interested persons” of any party thereto, as defined in the 1940 Act (the “Independent Trustees”), cast in person at a meeting called for the purpose of voting on such renewal.

A Board meeting was held on November 18, 2014 to decide whether to renew the Agreement for an additional one-year term. In preparation for the meeting, the Trustees requested that the Adviser furnish information necessary to evaluate the terms of the Agreement. Prior to the meeting, the Independent Trustees of the Fund met to review and discuss the information provided and submitted a request for additional information to the Adviser, and information was provided in response to this request. The Trustees used this information, as well as other information that the Adviser and other service providers of the Fund presented or submitted to the Board at the meeting and other meetings held during the prior year, to help them decide whether to renew the Agreement for an additional year.

Specifically, the Board requested and received written materials from the Adviser and other service providers of the Fund regarding: (i) the nature, extent and quality of the Adviser’s services; (ii) the Adviser’s investment management personnel; (iii) the Adviser’s operations and financial condition; (iv) the Adviser’s brokerage practices (including any soft dollar arrangements) and investment strategies; (v) the Fund’s advisory fee paid to the Adviser and overall fees and operating expenses compared with a peer group of mutual funds; (vi) the level of the Adviser’s profitability from its relationship with the Fund, including both direct and indirect benefits accruing to the Adviser and its affiliates; (vii) the Adviser’s potential economies of scale; (viii) the Adviser’s compliance systems; (ix) the Adviser’s policies on and compliance procedures for personal securities transactions; and (x) the Fund’s performance compared with a peer group of mutual funds and the Fund’s benchmark index.

Representatives from the Adviser, along with other Fund service providers, presented additional information and participated in question and answer sessions at the Board meeting to help the Trustees evaluate the Adviser’s services, fee and other aspects of the Agreement. The Independent Trustees received advice from independent counsel and met in executive sessions outside the presence of Fund management and the Adviser.

 

21


THE ADVISORS’ INNER CIRCLE FUND    THOMSON HORSTMANN &
   BRYANT MICROCAP FUND
   APRIL 30, 2015
   (Unaudited)

 

 

 

At the Board meeting, the Trustees, including all of the Independent Trustees, based on their evaluation of the information provided by the Adviser and other service providers of the Fund, renewed the Agreement. In considering the renewal of the Agreement, the Board considered various factors that they determined were relevant, including: (i) the nature, extent and quality of the services provided by the Adviser; (ii) the investment performance of the Fund and the Adviser; (iii) the costs of the services provided and profits realized by the Adviser from its relationship with the Fund, including both direct and indirect benefits accruing to the Adviser and its affiliates; (iv) the extent to which economies of scale are being realized by the Adviser; and (v) whether fee levels reflect any economies of scale being realized by the Adviser for the benefit of Fund investors, as discussed in further detail below.

Nature, Extent and Quality of Services Provided by the Adviser

In considering the nature, extent and quality of the services provided by the Adviser, the Board reviewed the portfolio management services provided by the Adviser to the Fund, including the quality and continuity of the Adviser’s portfolio management personnel and the resources of the Adviser. The Trustees reviewed the terms of the Agreement. The Trustees also reviewed the Adviser’s investment approach for the Fund. The most recent investment adviser registration form (“Form ADV”) for the Adviser was provided to the Board, as was the response of the Adviser to a detailed series of questions which included, among other things, information about the background and experience of the portfolio managers primarily responsible for the day-to-day management of the Fund.

The Trustees also considered other services provided to the Fund by the Adviser such as selecting broker-dealers for executing portfolio transactions, monitoring adherence to the Fund’s investment restrictions, and monitoring compliance with various Fund policies and procedures and with applicable securities laws and regulations. Based on the factors above, as well as those discussed below, the Board concluded, within the context of its full deliberations, that the nature, extent and quality of the services provided to the Fund by the Adviser were sufficient to support renewal of the Agreement.

Investment Performance of the Fund and the Adviser

The Board was provided with information regarding the Fund’s performance since the Agreement was last renewed, as well as information regarding the Fund’s performance over other time periods including since its inception. The Trustees also reviewed reports prepared by the Fund’s administrator comparing the Fund’s performance to its benchmark index and a peer group of mutual funds as classified by

 

22


THE ADVISORS’ INNER CIRCLE FUND    THOMSON HORSTMANN &
   BRYANT MICROCAP FUND
   APRIL 30, 2015
   (Unaudited)

 

 

 

Lipper, an independent provider of investment company data, over various periods of time. Representatives from the Adviser provided information regarding and led discussions of factors impacting the performance of the Fund, outlining current market conditions and explaining their expectations and strategies for the future. The Trustees considered reasons for the underperformance of the Fund relative to its benchmark and peer group and the steps recently taken by the Adviser in an effort to improve the performance of the Fund. Based on this information, the Board concluded, within the context of its full deliberations, that the investment results that the Adviser had been able to achieve for the Fund were sufficient to support renewal of the Agreement.

Costs of Advisory Services, Profitability and Economies of Scale

In considering the advisory fee payable by the Fund to the Adviser, the Trustees reviewed, among other things, a report of the advisory fee paid to the Adviser. The Trustees also reviewed reports prepared by the Fund’s administrator comparing the Fund’s net and gross expense ratios and advisory fees to those paid by a peer group of mutual funds as classified by Lipper. The Trustees reviewed the management fees charged by the Adviser to institutional and other clients with comparable mandates. The Trustees considered any differences in management fees and took into account the respective demands, resources and complexity associated with the Fund and other client accounts as well as the extensive regulatory and tax regimes to which the Fund is subject. The Board concluded, within the context of its full deliberations, that the advisory fee was reasonable in light of the nature and quality of the services rendered by the Adviser.

The Trustees reviewed the costs of services provided by and the profits realized by the Adviser from its relationship with the Fund, including both direct and indirect benefits accruing to the Adviser and its affiliates. The Trustees noted that the profitability of any adviser was affected by numerous factors, including its organizational structure and method for allocating expenses. The Trustees concluded that the profit margins of the Adviser with respect to the management of the Fund were not unreasonable. The Board also considered the Adviser’s commitment to managing the Fund and its willingness to continue its expense limitation and fee waiver arrangement with the Fund.

The Trustees considered the Adviser’s views relating to economies of scale in connection with the Fund as Fund assets grow and the extent to which any such economies of scale are shared with the Fund and Fund shareholders. The Board considered the existence of any economies of scale and whether those were passed

 

23


THE ADVISORS’ INNER CIRCLE FUND    THOMSON HORSTMANN &
   BRYANT MICROCAP FUND
   APRIL 30, 2015
   (Unaudited)

 

 

 

along to the Fund’s shareholders through a graduated advisory fee schedule or other means, including fee waivers. The Trustees recognized that economies of scale are difficult to identify and quantify and are rarely identifiable on a fund-by-fund basis. Based on this evaluation, the Board was unable to conclude that economies of scale, if any, were not appropriately shared with the Fund.

Based on the Board’s deliberations and its evaluation of the information described above and other factors and information it believed relevant in the exercise of its reasonable business judgment, the Board, including all of the Independent Trustees, unanimously concluded that the terms of the Agreement, including the fees payable thereunder, were fair and reasonable and agreed to renew the Agreement for another year. In its deliberations, the Board did not identify any particular factor (or conclusion with respect thereto) or single piece of information that was all-important, controlling or determinative of its decision and each Trustee may have attributed different weights to the various factors (and conclusions with respect thereto) and information.

 

24


Thomson Horstmann & Bryant Microcap Fund

P.O. Box 219009

Kansas City, MO 64121

1-855-THB-FUND

(1-855-842-3863)

Adviser:

Thomson Horstmann & Bryant, Inc.

501 Merritt 7

Norwalk, CT 06851

Distributor:

SEI Investments Distribution Co.

One Freedom Valley Drive

Oaks, PA 19456

Administrator:

SEI Investments Global Funds Services

One Freedom Valley Drive

Oaks, PA 19456

Legal Counsel:

Morgan, Lewis & Bockius LLP

1701 Market Street

Philadelphia, PA 19103-2921

This information must be preceded or accompanied by a current prospectus for the Fund described.

THB-SA-001-0400


Item 2. Code of Ethics.

Not applicable for semi-annual report.

 

Item 3. Audit Committee Financial Expert.

Not applicable for semi-annual report.

 

Item 4. Principal Accountant Fees and Services.

Not applicable for semi-annual report.

 

Item 5. Audit Committee of Listed Registrants.

Not applicable to open-end management investment companies.

 

Item 6. Schedule of Investments.

Schedule of Investments is included as part of the Report to Shareholders filed under Item 1 of this form.

 

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

Not applicable to open-end management investment companies.

 

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

Not applicable. Effective for closed-end management investment companies for fiscal years ending on or after December 31, 2005

 

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

Not applicable to open-end management investment companies.

 

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

There have been no changes to the procedures by which shareholders may recommend nominees to the Registrant’s Board of Trustees during the period covered by this report.

 

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 Act (17 CFR 270.30a-3(c))) as of a date within 90 days of the filing date of the report, are effective based on the evaluation of these controls and procedures required by Rule 30a-3(b) under the Act (17 CFR 270.30a-3(b)) and Rules 13a-15(b) or 15d-15(b) under the Exchange Act (17 CFR 240.13a-15(b) or 240.15d-15(b)).

(b) There has been no change in the Registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the Act (17 CFR 270.30a-3(d)) that occurred during the 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.


Items 12. Exhibits.

(a)(1) Not applicable for semi-annual report.

(a)(2) A separate certification for the principal executive officer and the principal financial officer of the Registrant as required by Rule 30a-2(a) under the Investment Company Act of 1940, as amended (17 CFR 270.30a-2(a)), are filed herewith.

(b) Officer certifications as required by Rule 30a-2(b) under the Investment Company Act of 1940, as amended (17 CFR 270.30a-2(b)) also accompany this filing as an Exhibit.


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)       The Advisors’ Inner Circle Fund
By (Signature and Title)      

/s/ Michael Beattie

      Michael Beattie, President
Date: June 26, 2015      

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/ Michael Beattie

      Michael Beattie, President
Date: June 26, 2015      
By (Signature and Title)      

/s/ Rami Abdel-Rahman

      Rami Abdel-Rahman
      Treasurer, Controller & CFO
Date: June 26, 2015