Templeton Global Opportunities Trust
Financial Statements
Statement of Assets and Liabilities
December 31, 2013
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Assets:
|
|
|
|
|
|
Investments in securities:
|
|
|
|
|
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Cost
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$
|
|
448,494,343
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|
|
Value
|
$
|
|
616,282,275
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|
|
Cash
|
|
|
11,250,253
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|
|
Foreign currency, at value (cost $33,689)
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|
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33,689
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|
|
Receivables:
|
|
|
|
|
|
Investment securities sold
|
|
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7,618,674
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|
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Capital shares sold
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|
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381,175
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|
|
Dividends
|
|
|
756,423
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|
|
Other assets
|
|
|
7,476
|
|
|
Total assets
|
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636,329,965
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|
|
Liabilities:
|
|
|
|
|
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Payables:
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|
|
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Investment securities purchased
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325,817
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Capital shares redeemed
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|
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1,315,133
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|
|
Management fees
|
|
|
397,426
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|
|
Administrative fees
|
|
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74,085
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|
|
Distribution fees
|
|
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304,875
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|
|
Transfer agent fees
|
|
|
165,439
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|
|
Deferred tax
|
|
|
509,936
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|
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Accrued expenses and other liabilities
|
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132,264
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|
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Total liabilities
|
|
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3,224,975
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Net assets, at value
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$
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|
633,104,990
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Net assets consist of:
|
|
|
|
|
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Paid-in capital
|
$
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|
478,974,832
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|
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Undistributed net investment income
|
|
|
2,584,580
|
|
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Net unrealized appreciation (depreciation)
|
|
|
167,299,723
|
|
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Accumulated net realized gain (loss)
|
|
|
(15,754,145
|
)
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Net assets, at value
|
$
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|
633,104,990
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Class A:
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Net assets, at value
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$
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|
583,418,940
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|
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Shares outstanding
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25,021,218
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Net asset value per share
a
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$
|
23.32
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|
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Maximum offering price per share (net asset value per share ÷ 94.25%)
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$
|
24.74
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Class C:
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|
|
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Net assets, at value
|
$
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|
39,007,256
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Shares outstanding
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1,707,317
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Net asset value and maximum offering price per share
a
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$
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22.85
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Advisor Class:
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Net assets, at value
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$
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10,678,794
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Shares outstanding
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458,409
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Net asset value and maximum offering price per share
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$
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23.30
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a
Redemption price is equal to net asset value less contingent deferred sales charges, if applicable.
Annual Report
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The accompanying notes are an integral part of these financial statements.
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21
Templeton Global Opportunities Trust
Financial Statements
(continued)
Statement of Operations
for the year ended December 31, 2013
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Investment income:
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Dividends (net of foreign taxes of $1,179,541)
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$
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14,537,967
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|
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Interest
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|
503
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Income from securities loaned
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266,341
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Total investment income
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14,804,811
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Expenses:
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|
|
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Management fees (Note 3a)
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4,698,960
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Administrative fees (Note 3b)
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875,813
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Distribution fees: (Note 3c)
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Class A
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1,458,446
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Class B
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|
73
|
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Class C
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349,885
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Transfer agent fees: (Note 3e)
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Class A
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689,956
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Class B
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9
|
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Class C
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41,348
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Advisor Class
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|
9,200
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Custodian fees (Note 4)
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75,712
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Reports to shareholders
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60,727
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Registration and filing fees
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|
76,403
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Professional fees
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|
99,302
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Trustees’ fees and expenses
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|
57,331
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Other
|
|
32,133
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|
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Total expenses
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|
8,525,298
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|
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Net investment income
|
|
6,279,513
|
|
|
Realized and unrealized gains (losses):
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|
|
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|
Net realized gain (loss) from:
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|
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|
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Investments
|
|
52,631,823
|
|
|
Foreign currency transactions
|
|
(363,365
|
)
|
|
Net realized gain (loss)
|
|
52,268,458
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|
|
Net change in unrealized appreciation (depreciation) on:
|
|
|
|
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Investments
|
|
85,851,365
|
|
|
Translation of other assets and liabilities denominated in foreign currencies
|
|
27,740
|
|
|
Change in deferred taxes on unrealized appreciation
|
|
(509,936
|
)
|
|
Net change in unrealized appreciation (depreciation)
|
|
85,369,169
|
|
|
Net realized and unrealized gain (loss)
|
|
137,637,627
|
|
|
Net increase (decrease) in net assets resulting from operations
|
$
|
143,917,140
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|
22
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The accompanying notes are an integral part of these financial statements.
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Annual Report
Templeton Global Opportunities Trust
Financial Statements
(continued)
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Statements of Changes in Net Assets
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Year Ended December 31,
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2013
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|
|
2012
|
|
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Increase (decrease) in net assets:
|
|
|
|
|
|
|
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Operations:
|
|
|
|
|
|
|
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Net investment income
|
$
|
6,279,513
|
|
$
|
10,348,365
|
|
|
Net realized gain (loss) from investments and foreign currency transactions
|
|
52,268,458
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|
|
(14,514,946
|
)
|
|
Net change in unrealized appreciation (depreciation) on investments, translation of other
|
|
|
|
|
|
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assets and liabilities denominated in foreign currencies and deferred taxes
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|
85,369,169
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136,677,175
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|
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Net increase (decrease) in net assets resulting from operations
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|
143,917,140
|
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|
132,510,594
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Distributions to shareholders from:
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|
|
|
|
|
|
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Net investment income:
|
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|
|
|
|
|
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Class A
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|
(5,361,855
|
)
|
|
(10,428,993
|
)
|
|
Class B
|
|
—
|
|
|
(520
|
)
|
|
Class C
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|
(180,547
|
)
|
|
(312,175
|
)
|
|
Advisor Class
|
|
(114,531
|
)
|
|
(129,602
|
)
|
|
Total distributions to shareholders
|
|
(5,656,933
|
)
|
|
(10,871,290
|
)
|
|
Capital share transactions: (Note 2)
|
|
|
|
|
|
|
|
Class A
|
|
(170,702,006
|
)
|
|
(115,393,412
|
)
|
|
Class B
|
|
(87,451
|
)
|
|
(477,825
|
)
|
|
Class C
|
|
(346,980
|
)
|
|
(4,780,141
|
)
|
|
Advisor Class
|
|
2,256,385
|
|
|
(558,023
|
)
|
|
Total capital share transactions
|
|
(168,880,052
|
)
|
|
(121,209,401
|
)
|
|
Net increase (decrease) in net assets
|
|
(30,619,845
|
)
|
|
429,903
|
|
|
Net assets:
|
|
|
|
|
|
|
|
Beginning of year
|
|
663,724,835
|
|
|
663,294,932
|
|
|
End of year
|
$
|
633,104,990
|
|
$
|
663,724,835
|
|
|
Undistributed net investment income included in net assets:
|
|
|
|
|
|
|
|
End of year
|
$
|
2,584,580
|
|
$
|
2,462,674
|
|
Annual Report
|
The accompanying notes are an integral part of these financial statements.
|
23
Templeton Global Opportunities Trust
Notes to Financial Statements
1. O
RGANIZATION AND
S
IGNIFICANT
A
CCOUNTING
P
OLICIES
Templeton Global Opportunities Trust (Fund) is registered under the Investment Company Act of 1940, as amended, (1940 Act) as an open-end investment company. The Fund offers three classes of shares: Class A, Class C, and Advisor Class. Effective March 22, 2013, all Class B shares were converted to Class A. Each class of shares differs by its initial sales load, contingent deferred sales charges, voting rights on matters affecting a single class, its exchange privilege and fees primarily due to differing arrangements for distribution and transfer agent fees.
The following summarizes the Fund’s significant accounting policies.
a. Financial Instrument Valuation
The Fund’s investments in financial instruments are carried at fair value daily. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. The Fund calculates the net asset value (NAV) per share at the close of the New York Stock Exchange (NYSE), generally at 4 p.m. Eastern time (NYSE close) on each day the NYSE is open for trading. Under procedures approved by the Fund’s Board of Trustees (the Board), the Fund’s administrator, investment manager and other affiliates have formed the Valuation and Liquidity Oversight Committee (VLOC). The VLOC provides administration and oversight of the Fund’s valuation policies and procedures, which are approved annually by the Board. Among other things, these procedures allow the Fund to utilize independent pricing services, quotations from securities and financial instrument dealers, and other market sources to determine fair value.
Equity securities listed on an exchange or on the NASDAQ National Market System are valued at the last quoted sale price or the official closing price of the day, respectively. Foreign equity securities are valued as of the close of trading on the foreign stock exchange on which the security is primarily traded or as of the NYSE close, whichever is earlier. The value is then converted into its U.S. dollar equivalent at the foreign exchange rate in effect at the NYSE close on the day that the value of the security is determined. Over-the-counter (OTC) securities are valued within the range of the most recent quoted bid and ask prices. Securities that trade in multiple markets or on multiple exchanges are valued according to the broadest and most representative market. Certain equity securities are valued based upon fundamental characteristics or relationships to similar securities.
The Fund has procedures to determine the fair value of financial instruments for which market prices are not reliable or readily available. Under these procedures, the VLOC convenes on a regular basis to review such financial instruments and considers a number of factors, including significant unobservable valuation inputs, when arriving at fair value. The VLOC primarily employs a market-based approach which may use related or comparable assets or liabilities, recent transactions, market multiples, book values, and other relevant information for the investment to determine the fair value of the investment. An income-based valuation approach may also be used in which the anticipated future cash flows of the investment are discounted to calculate fair value. Discounts may also be applied due to the nature or duration of any restrictions on the disposition
24
|
Annual Report
Templeton Global Opportunities Trust
Notes to Financial Statements
(continued)
|
1.
|
O
RGANIZATION AND
S
IGNIFICANT
A
CCOUNTING
P
OLICIES
(continued)
|
|
a.
|
Financial Instrument Valuation
(continued)
|
of the investments. Due to the inherent uncertainty of valuations of such investments, the fair values may differ significantly from the values that would have been used had an active market existed. The VLOC employs various methods for calibrating these valuation approaches including a regular review of key inputs and assumptions, transactional back-testing or disposition analysis, and reviews of any related market activity.
Trading in securities on foreign securities stock exchanges and OTC markets may be completed before the daily NYSE close. In addition, trading in certain foreign markets may not take place on every NYSE business day. Occasionally, events occur between the time at which trading in a foreign security is completed and the close of the NYSE that might call into question the reliability of the value of a portfolio security held by the Fund. As a result, differences may arise between the value of the Fund’s portfolio securities as determined at the foreign market close and the latest indications of value at the close of the NYSE. In order to minimize the potential for these differences, the VLOC monitors price movements following the close of trading in foreign stock markets through a series of country specific market proxies (such as baskets of American Depositary Receipts, futures contracts and exchange traded funds). These price movements are measured against established trigger thresholds for each specific market proxy to assist in determining if an event has occurred that may call into question the reliability of the values of the foreign securities held by the Fund. If such an event occurs, the securities may be valued using fair value procedures, which may include the use of independent pricing services.
Also, when the last day of the reporting period is a non-business day, certain foreign markets may be open on those days that the NYSE is closed, which could result in differences between the value of the Fund’s portfolio securities on the last business day and the last calendar day of the reporting period. Any significant security valuation changes due to an open foreign market are adjusted and reflected by the Fund for financial reporting purposes.
b. Foreign Currency Translation
Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars based on the exchange rate of such currencies against U.S. dollars on the date of valuation. The Fund may enter into foreign currency exchange contracts to facilitate transactions denominated in a foreign currency. Purchases and sales of securities, income and expense items denominated in foreign currencies are translated into U.S. dollars at the exchange rate in effect on the transaction date. Portfolio securities and assets and liabilities denominated in foreign currencies contain risks that those currencies will decline in value relative to the U.S. dollar. Occasionally, events may impact the availability or reliability of foreign exchange rates used to convert the U.S. dollar equivalent value. If such an event occurs, the foreign exchange rate will be valued at fair value using procedures established and approved by the Board.
Annual Report
|
25
Templeton Global Opportunities Trust
Notes to Financial Statements
(continued)
|
1.
|
O
RGANIZATION AND
S
IGNIFICANT
A
CCOUNTING
P
OLICIES
(continued)
|
|
b.
|
Foreign Currency Translation
(continued)
|
The Fund does not separately report the effect of changes in foreign exchange rates from changes in market prices on securities held. Such changes are included in net realized and unrealized gain or loss from investments on the Statement of Operations.
Realized foreign exchange gains or losses arise from sales of foreign currencies, currency gains or losses realized between the trade and settlement dates on securities transactions and the difference between the recorded amounts of dividends, interest, and foreign withholding taxes and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign exchange gains and losses arise from changes in foreign exchange rates on foreign denominated assets and liabilities other than investments in securities held at the end of the reporting period.
c. Securities Lending
The Fund participates in an agency based securities lending program. The Fund receives cash collateral against the loaned securities in an amount equal to at least 102% of the market value of the loaned securities. Collateral is maintained over the life of the loan in an amount not less than 100% of the market value of loaned securities, as determined at the close of fund business each day; any additional collateral required due to changes in security values is delivered to the Fund on the next business day. The collateral is invested in a non-registered money fund. The Fund receives income from the investment of cash collateral, in addition to lending fees and rebates paid by the borrower. The Fund bears the market risk with respect to the collateral investment, securities loaned, and the risk that the agent may default on its obligations to the Fund. The securities lending agent has agreed to indemnify the Fund in the event of default by a third party borrower. At December 31, 2013, the Fund had no securities on loan.
d. Investment in Templeton China Opportunities Fund, Ltd.
The Fund invests in Templeton China Opportunities Fund, Ltd. (China Fund), a private offering of unregistered shares in a Cayman Islands Exempt Company. The China Fund investment objective is to seek capital growth primarily through investments in A-shares of Chinese companies listed on the Shanghai and Shenzhen stock exchanges. Chinese A-shares are traded in Chinese Renminbi and are only available as an investment to domestic (Chinese) investors and holders of a Qualified Foreign Institutional Investors license. The China Fund is managed by Templeton Investment Counsel, LLC (the investment manager). No additional management or administrative fees are incurred on assets invested in the China Fund.
The China Fund may be subject to certain restrictions and administrative processes relating to its ability to repatriate cash balances, investment proceeds and earnings associated with its investment, as such activities are subject to approval by agencies of the Chinese government and thus the Fund may incur delays in redeeming its investment in the China Fund. The Fund’s investment in the China Fund is valued based upon the fair value of the China Fund’s portfolio securities and other assets and liabilities.
26
|
Annual Report
Templeton Global Opportunities Trust
Notes to Financial Statements
(continued)
|
1.
|
O
RGANIZATION AND
S
IGNIFICANT
A
CCOUNTING
P
OLICIES
(continued)
|
|
e.
|
Income and Deferred Taxes
|
It is the Fund’s policy to qualify as a regulated investment company under the Internal Revenue Code. The Fund intends to distribute to shareholders substantially all of its taxable income and net realized gains to relieve it from federal income and excise taxes. As a result, no provision for U.S. federal income taxes is required.
The Fund may be subject to foreign taxation related to income received, capital gains on the sale of securities and certain foreign currency transactions in the foreign jurisdictions in which it invests. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests. When a capital gain tax is determined to apply the Fund records an estimated deferred tax liability in an amount that would be payable if the securities were disposed of on the valuation date.
The Fund recognizes the tax benefits of uncertain tax positions only when the position is “more likely than not” to be sustained upon examination by the tax authorities based on the technical merits of the tax position. As of December 31, 2013, and for all open tax years, the Fund has determined that no liability for unrecognized tax benefits is required in the Fund’s financial statements related to uncertain tax positions taken on a tax return (or expected to be taken on future tax returns). Open tax years are those that remain subject to examination and are based on each tax jurisdiction statute of limitation.
f. Security Transactions, Investment Income, Expenses and Distributions
Security transactions are accounted for on trade date. Realized gains and losses on security transactions are determined on a specific identification basis. Estimated expenses are accrued daily. Dividend income is recorded on the ex-dividend date except that certain dividends from foreign securities are recognized as soon as the Fund is notified of the ex-dividend date. Distributions to shareholders are recorded on the ex-dividend date and are determined according to income tax regulations (tax basis). Distributable earnings determined on a tax basis may differ from earnings recorded in accordance with accounting principles generally accepted in the United States of America. These differences may be permanent or temporary. Permanent differences are reclassified among capital accounts to reflect their tax character. These reclassifications have no impact on net assets or the results of operations. Temporary differences are not reclassified, as they may reverse in subsequent periods.
Realized and unrealized gains and losses and net investment income, not including class specific expenses, are allocated daily to each class of shares based upon the relative proportion of net assets of each class. Differences in per share distributions, by class, are generally due to differences in class specific expenses.
Annual Report
|
27
Templeton Global Opportunities Trust
Notes to Financial Statements
(continued)
|
1.
|
O
RGANIZATION AND
S
IGNIFICANT
A
CCOUNTING
P
OLICIES
(continued)
|
|
g.
|
Accounting Estimates
|
The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the amounts of income and expenses during the reporting period. Actual results could differ from those estimates.
h. Guarantees and Indemnifications
Under the Fund’s organizational documents, its officers and trustees are indemnified by the Fund against certain liabilities arising out of the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts with service providers that contain general indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. Currently, the Fund expects the risk of loss to be remote.
2. S
HARES OF
B
ENEFICIAL
I
NTEREST
At December 31, 2013, there were an unlimited number of shares authorized (without par value).
Transactions in the Fund’s shares were as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31,
|
|
|
|
|
|
|
|
2013
|
|
|
2012
|
|
|
|
Shares
|
|
|
|
Amount
|
|
Shares
|
|
|
|
Amount
|
|
|
Class A Shares:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares sold
|
2,817,053
|
|
|
$
|
58,904,354
|
|
3,336,869
|
|
|
$
|
57,590,839
|
|
|
Shares issued in reinvestment of
|
|
|
|
|
|
|
|
|
|
|
|
|
|
distributions
|
183,011
|
|
|
|
4,010,400
|
|
381,925
|
|
|
|
7,064,633
|
|
|
Shares redeemed
|
(11,374,296
|
)
|
|
|
(233,616,760
|
)
|
(10,506,800
|
)
|
|
|
(180,048,884
|
)
|
|
Net increase (decrease)
|
(8,374,232
|
)
|
$
|
(170,702,006
|
)
|
(6,788,006
|
)
|
$
|
(115,393,412
|
)
|
|
Class B Shares:
a
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares sold
|
87
|
|
|
$
|
1,699
|
|
836
|
|
|
$
|
13,482
|
|
|
Shares issued in reinvestment of
|
|
|
|
|
|
|
|
|
|
|
|
|
|
distributions
|
—
|
|
|
|
—
|
|
25
|
|
|
|
449
|
|
|
Shares redeemed
|
(4,581
|
)
|
|
|
(89,150
|
)
|
(28,739
|
)
|
|
|
(491,756
|
)
|
|
Net increase (decrease)
|
(4,494
|
)
|
|
$
|
(87,451
|
)
|
(27,878
|
)
|
|
$
|
(477,825
|
)
|
|
Class C Shares:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares sold
|
251,200
|
|
|
$
|
5,073,615
|
|
130,046
|
|
|
$
|
2,191,721
|
|
|
Shares issued in reinvestment of
|
|
|
|
|
|
|
|
|
|
|
|
|
|
distributions
|
8,197
|
|
|
|
168,864
|
|
16,004
|
|
|
|
289,319
|
|
|
Shares redeemed
|
(278,521
|
)
|
|
|
(5,589,459
|
)
|
(434,456
|
)
|
|
|
(7,261,181
|
)
|
|
Net increase (decrease)
|
(19,124
|
)
|
|
$
|
(346,980
|
)
|
(288,406
|
)
|
|
$
|
(4,780,141
|
)
|
28
|
Annual Report
Templeton Global Opportunities Trust
Notes to Financial Statements
(continued)
|
|
|
|
|
|
|
|
|
|
|
|
|
2. S
HARES OF
B
ENEFICIAL
I
NTEREST
(continued)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31,
|
|
|
|
|
|
|
2013
|
|
|
2012
|
|
|
|
|
Shares
|
|
|
Amount
|
|
Shares
|
|
|
Amount
|
|
|
Advisor Class Shares:
|
|
|
|
|
|
|
|
|
|
|
|
Shares sold
|
166,304
|
|
$
|
3,688,820
|
|
73,155
|
|
$
|
1,273,113
|
|
|
Shares issued in reinvestment of
|
|
|
|
|
|
|
|
|
|
|
|
distributions
|
3,797
|
|
|
84,637
|
|
4,964
|
|
|
91,822
|
|
|
Shares redeemed
|
(71,338
|
)
|
|
(1,517,072
|
)
|
(113,352
|
)
|
|
(1,922,958
|
)
|
|
Net increase (decrease)
|
98,763
|
|
$
|
2,256,385
|
|
(35,233
|
)
|
$
|
(558,023
|
)
|
|
|
|
a
Effective March 22, 2013, all Class B shares were converted to Class A.
|
|
|
|
|
|
|
|
|
|
3. T
RANSACTIONS WITH
A
FFILIATES
Franklin Resources, Inc. is the holding company for various subsidiaries that together are referred to as Franklin Templeton Investments. Certain officers and trustees of the Fund are also officers and/or directors of the following subsidiaries:
|
|
|
|
Subsidiary
|
Affiliation
|
|
Templeton Investment Counsel, LLC (TIC)
|
Investment manager
|
|
Templeton Asset Management Ltd. (TAML)
|
Investment manager
|
|
Franklin Templeton Investments (Asia) Limited (FTIA)
|
Investment manager
|
|
Franklin Templeton Services, LLC (FT Services)
|
Administrative manager
|
|
Franklin Templeton Distributors, Inc. (Distributors)
|
Principal underwriter
|
|
Franklin Templeton Investor Services, LLC (Investor Services)
|
Transfer agent
|
a. Management Fees
The Fund pays an investment management fee to TIC based on the average daily net assets of the Fund as follows:
|
|
|
|
|
Annualized Fee Rate
|
|
Net Assets
|
|
0.750
|
%
|
Up to and including $1 billion
|
|
0.730
|
%
|
Over $1 billion, up to and including $5 billion
|
|
0.710
|
%
|
Over $5 billion, up to and including $10 billion
|
|
0.690
|
%
|
Over $10 billion, up to and including $15 billion
|
|
0.670
|
%
|
Over $15 billion, up to and including $20 billion
|
|
0.650
|
%
|
In excess of $20 billion
|
Under a subadvisory agreement, TAML and FTIA, affiliates of TIC, provide subadvisory services to the Fund. The subadvisory fee is paid by TIC based on the average daily net assets, and is not an additional expense of the Fund.
Annual Report
|
29
Templeton Global Opportunities Trust
Notes to Financial Statements
(continued)
|
3.
|
T
RANSACTIONS WITH
A
FFILIATES
(continued)
i
|
|
b.
|
Administrative Fees
|
The Fund pays an administrative fee to FT Services based on the Fund’s average daily net assets as follows:
|
|
|
|
|
Annualized Fee Rate
|
|
Net Assets
|
|
0.150
|
%
|
Up to and including $200 million
|
|
0.135
|
%
|
Over $200 million, up to and including $700 million
|
|
0.100
|
%
|
Over $700 million, up to and including $1.2 billion
|
|
0.075
|
%
|
In excess of $1.2 billion
|
c. Distribution Fees
The Board has adopted distribution plans for each share class, with the exception of Advisor Class shares, pursuant to Rule 12b-1 under the 1940 Act. Distribution fees are not charged on shares held by affiliates. Under the Fund’s Class A reimbursement distribution plan, the Fund reimburses Distributors for costs incurred in connection with the servicing, sale and distribution of the Fund’s shares up to the maximum annual plan. Under the Class A reimbursement distribution plan, costs exceeding the maximum for the current plan year cannot be reimbursed in subsequent periods.
In addition, under the Fund’s Class B and C compensation distribution plans, the Fund pays Distributors for costs incurred in connection with the servicing, sale and distribution of the Fund’s shares up to the maximum annual plan rate for each class. The plan year, for purposes of monitoring compliance with the maximum annual plan rates, is February 1 through January 31.
The maximum annual plan rates, based on the average daily net assets, for each class, are as follows:
|
|
|
|
|
Class A
|
0.25
|
%
|
|
Class B
|
1.00
|
%
|
|
Class C
|
1.00
|
%
|
d. Sales Charges/Underwriting Agreements
Front-end sales charges and contingent deferred sales charges (CDSC) do not represent expenses of the Fund. These charges are deducted from the proceeds of sales of Fund shares prior to investment or from redemption proceeds prior to remittance, as applicable. Distributors has advised the Fund of the following commission transactions related to the sales and redemptions of the Fund’s shares for the year:
|
|
|
|
|
Sales charges retained net of commissions paid to unaffiliated
|
|
|
|
broker/dealers
|
$
|
45,813
|
|
CDSC retained
|
$
|
1,905
|
30
|
Annual Report
Templeton Global Opportunities Trust
Notes to Financial Statements
(continued)
|
3.
|
T
RANSACTIONS WITH
A
FFILIATES
(continued)
i
|
|
e.
|
Transfer Agent Fees
|
Each class of shares pays transfer agent fees to Investor Services for its performance of shareholder servicing obligations and reimburses Investor Services for out of pocket expenses incurred, including shareholding servicing fees paid to third parties. These fees are allocated daily based upon their relative proportion of such classes’ aggregate net assets.
For the year ended December 31, 2013, the Fund paid transfer agent fees of $740,513, of which $445,843 was retained by Investor Services.
4. E
XPENSE
O
FFSET
A
RRANGEMENT
The Fund has entered into an arrangement with its custodian whereby credits realized as a result of uninvested cash balances are used to reduce a portion of the Fund’s custodian expenses. During the year ended December 31, 2013, there were no credits earned.
5. I
NCOME
T
AXES
For tax purposes, capital losses may be carried over to offset future capital gains. Capital loss carryforwards with no expiration, if any, must be fully utilized before those losses with expiration dates.
At December 31, 2013, the Fund had capital loss carryforwards of $12,226,739 expiring in 2018.
During the year ended December 31, 2013, the Fund utilized $52,169,539 of capital loss carryforwards.
The tax character of distributions paid during the years ended December 31, 2013 and 2012, was as follows:
|
|
|
|
|
|
|
|
|
2013
|
|
2012
|
|
Distributions paid from ordinary income
|
$
|
5,656,933
|
$
|
10,871,290
|
At December 31, 2013, the cost of investments, net unrealized appreciation (depreciation) and undistributed ordinary income for income tax purposes were as follows:
|
|
|
|
|
|
Cost of investments
|
$
|
452,747,155
|
|
|
|
|
Unrealized appreciation
|
$
|
182,137,025
|
|
|
Unrealized depreciation
|
|
(18,601,905
|
)
|
|
Net unrealized appreciation (depreciation)
|
$
|
163,535,120
|
|
|
|
|
Distributable earnings – undistributed ordinary income
|
$
|
3,308,188
|
|
Annual Report
|
31
Templeton Global Opportunities Trust
Notes to Financial Statements
(continued)
5. I
NCOME
T
AXES
(continued)
i
Differences between income and/or capital gains as determined on a book basis and a tax basis are primarily due to differing treatment of wash sales.
6. I
NVESTMENT
T
RANSACTIONS
Purchases and sales of investments (excluding short term securities) for the year ended December 31, 2013, aggregated $173,511,381 and $339,390,909, respectively.
7. C
ONCENTRATION OF
R
ISK
Investing in foreign securities may include certain risks and considerations not typically associated with investing in U.S. securities, such as fluctuating currency values and changing local and regional economic, political and social conditions, which may result in greater market volatility. In addition, certain foreign securities may not be as liquid as U.S. securities.
8. R
ESTRICTED
S
ECURITIES
The Fund invests in securities that are restricted under the Securities Act of 1933 (1933 Act) or which are subject to legal, contractual, or other agreed upon restrictions on resale. Restricted securities are often purchased in private placement transactions, and cannot be sold without prior registration unless the sale is pursuant to an exemption under the 1933 Act. Disposal of these securities may require greater effort and expense, and prompt sale at an acceptable price may be difficult. The Fund may have registration rights for restricted securities. The issuer generally incurs all registration costs.
At December 31, 2013, the Fund held investments in restricted securities, excluding certain securities exempt from registration under the 1933 Act deemed to be liquid, as follows:
|
|
|
|
|
|
|
|
|
Shares
|
Issuer
|
Acquisition Dates
|
|
Cost
|
|
Value
|
|
415,426
|
Templeton China Opportunities Fund, Ltd., Reg D
|
|
|
|
|
|
|
|
(Value is 0.77% of Net Assets)
|
1/27/10 - 10/09/13
|
$
|
4,151,700
|
$
|
4,877,104
|
9. C
REDIT
F
ACILITY
The Fund, together with other U.S. registered and foreign investment funds (collectively, Borrowers), managed by Franklin Templeton Investments, are borrowers in a joint syndicated senior unsecured credit facility totaling $1.5 billion (Global Credit Facility) which, after an extension of the original terms, matured on February 14, 2014. This Global Credit Facility provides a source of funds to the Borrowers for temporary and emergency purposes, including the ability to meet future unanticipated or unusually large redemption requests. Effective February 14, 2014, the Borrowers renewed the Global Credit Facility which matures on February 13, 2015.
32
|
Annual Report
Templeton Global Opportunities Trust
Notes to Financial Statements
(continued)
9. C
REDIT
F
ACILITY
(continued)
Under the terms of the Global Credit Facility, the Fund shall, in addition to interest charged on any borrowings made by the Fund and other costs incurred by the Fund, pay its share of fees and expenses incurred in connection with the implementation and maintenance of the Global Credit Facility, based upon its relative share of the aggregate net assets of all of the Borrowers, including an annual commitment fee of 0.07% based upon the unused portion of the Global Credit Facility. These fees are reflected in other expenses on the Statement of Operations. During the year ended December 31, 2013, the Fund did not use the Global Credit Facility.
10. F
AIR
V
ALUE
M
EASUREMENTS
The Fund follows a fair value hierarchy that distinguishes between market data obtained from independent sources (observable inputs) and the Fund’s own market assumptions (unobservable inputs). These inputs are used in determining the value of the Fund’s financial instruments and are summarized in the following fair value hierarchy:
-
Level 1 – quoted prices in active markets for identical financial instruments
-
Level 2 – other significant observable inputs (including quoted prices for similar financial
instruments, interest rates, prepayment speed, credit risk, etc.)
-
Level 3 – significant unobservable inputs (including the Fund’s own assumptions in
determining the fair value of financial instruments)
The input levels are not necessarily an indication of the risk or liquidity associated with financial instruments at that level.
For movements between the levels within the fair value hierarchy, the Fund has adopted a policy of recognizing the transfers as of the date of the underlying event which caused the movement.
A summary of inputs used as of December 31, 2013, in valuing the Fund’s assets carried at fair value, is as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
|
Assets:
|
|
|
|
|
|
|
|
|
|
Investments in Securities:
|
|
|
|
|
|
|
|
|
|
Equity Investments
a,b
|
$
|
611,405,171
|
$
|
—
|
$
|
—
|
$
|
611,405,171
|
|
Non-Registered Mutual Funds
|
|
—
|
|
—
|
|
4,877,104
|
|
4,877,104
|
|
Total Investments in Securities
|
$
|
611,405,171
|
$
|
—
|
$
|
4,877,104
|
$
|
616,282,275
|
|
|
|
a
Includes common and preferred stocks.
|
|
|
|
|
|
|
|
|
|
b
For detailed categories, see the accompanying Statement of Investments.
|
|
|
|
|
|
|
A reconciliation of assets in which Level 3 inputs are used in determining fair value is presented when there are significant Level 3 investments at the end of the year.
Annual Report
|
33
Templeton Global Opportunities Trust
Notes to Financial Statements
(continued)
11. N
EW
A
CCOUNTING
P
RONOUNCEMENTS
In June 2013, the Financial Accounting Standards Board issued Accounting Standards Update (ASU) No. 2013-08, Investment Companies (Topic 946): Amendments to the Scope, Measurement, and Disclosure Requirements. The ASU modifies the criteria used in defining an investment company under U.S. Generally Accepted Accounting Principles and also sets forth certain measurement and disclosure requirements. Under the ASU, an entity that is registered under the 1940 Act automatically qualifies as an investment company. The ASU is effective for interim and annual reporting periods beginning after December 15, 2013. Management has reviewed the requirements and believes the adoption of this ASU will not have a material impact on the financial statements.
12. S
UBSEQUENT
E
VENTS
The Fund has evaluated subsequent events through the issuance of the financial statements and determined that no events have occurred that require disclosure other than those already disclosed in the financial statements.
A
BBREVIATIONS
Selected Portfolio
ADR
- American Depositary Receipt
IDR
- International Depositary Receipt
34
|
Annual Report
Templeton Global Opportunities Trust
Report of Independent Registered Public Accounting Firm
To the Board of Trustees and Shareholders of Templeton Global Opportunities Trust
In our opinion, the accompanying statement of assets and liabilities, including the statement of investments, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of Templeton Global Opportunities Trust (the “Fund”) at December 31, 2013, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended and the financial highlights for each of the periods presented, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as “financial statements”) are the responsibility of the Fund’s management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at December 31, 2013 by correspondence with the custodian, transfer agent and brokers, provide a reasonable basis for our opinion.
PricewaterhouseCoopers LLP
San Francisco, California
February 19, 2014
Annual Report
|
35
Templeton Global Opportunities Trust
Tax Information (unaudited)
Under Section 854(b)(1)(A) of the Internal Revenue Code (Code), the Fund hereby reports 55.79% of the ordinary income dividends as income qualifying for the dividends received deduction for the fiscal year ended December 31, 2013.
Under Section 854(b)(1)(B) of the Code, the Fund hereby reports the maximum amount allowable but no less than $12,708,064 as qualified dividends for purposes of the maximum rate under Section 1(h)(11) of the Code for the fiscal year ended December 31, 2013. Distributions, including qualified dividend income, paid during calendar year 2013 will be reported to shareholders on Form 1099-DIV by mid-February 2014. Shareholders are advised to check with their tax advisors for information on the treatment of these amounts on their individual income tax returns.
At December 31, 2013, more than 50% of the Fund’s total assets were invested in securities of foreign issuers. In most instances, foreign taxes were withheld from income paid to the Fund on these investments. As shown in the table below, the Fund hereby reports to shareholders the foreign source income and foreign taxes paid, pursuant to Section 853 of the Code. This written statement will allow shareholders of record on December 20, 2013, to treat their proportionate share of foreign taxes paid by the Fund as having been paid directly by them. The shareholder shall consider these amounts as foreign taxes paid in the tax year in which they receive the Fund distribution.
The following table provides a detailed analysis of foreign tax paid, foreign source income, and foreign qualified dividends as reported by the Fund, to Class A, Class C, and Advisor Class shareholders of record.
|
|
|
|
|
|
|
|
|
|
|
Foreign Tax Paid
|
|
Foreign Source Income
|
|
Foreign Qualified Dividends
|
|
Class
|
|
Per Share
|
|
Per Share
|
|
Per Share
|
|
Class A
|
$
|
0.0414
|
$
|
0.2193
|
$
|
0.1667
|
|
Class C
|
$
|
0.0414
|
$
|
0.1065
|
$
|
0.0811
|
|
Advisor Class
|
$
|
0.0414
|
$
|
0.2714
|
$
|
0.2064
|
Foreign Tax Paid Per Share (Column 1) is the amount per share available to you, as a tax credit (assuming you held your shares in the Fund for a minimum of 16 days during the 31-day period beginning 15 days before the ex-dividend date of the Fund’s distribution to which the foreign taxes relate), or, as a tax deduction.
36
|
Annual Report
Templeton Global Opportunities Trust
Tax Information (unaudited)
(continued)
Foreign Source Income Per Share (Column 2) is the amount per share of income dividends attributable to foreign securities held by the Fund, plus any foreign taxes withheld on these dividends. The amounts reported include foreign source qualified dividends that have not been adjusted for the rate differential applicable to such dividend income.
1
Foreign Qualified Dividends Per Share (Column 3) is the amount per share of foreign source qualified dividends, plus any foreign taxes withheld on these dividends. These amounts represent the portion of the Foreign Source Income reported to you in column 2 that were derived from qualified foreign securities held by the Fund.
1
By mid-February 2014, shareholders will receive Form 1099-DIV which will include their share of taxes paid and foreign source income distributed during the calendar year 2013. The Foreign Source Income reported on Form 1099-DIV has not been adjusted for the rate differential on foreign source qualified dividend income. Shareholders are advised to check with their tax advisors for information on the treatment of these amounts on their 2013 individual income tax returns.
1
Qualified dividends are taxed at reduced long term capital gains tax rates. In determining the amount of foreign tax credit that may be applied against the U.S. tax liability of individuals receiving foreign source qualified dividends, adjustments may be required to the foreign tax credit limitation calculation to reflect the rate differential applicable to such dividend income. The rules however permit certain individuals to elect not to apply the rate differential adjustments for capital gains and/or dividends for any taxable year. Please consult your tax advisor and the instructions to Form 1116 for more information.
Annual Report
|
37
Templeton Global Opportunities Trust
Board Members and Officers
The name, year of birth and address of the officers and board members, as well as their affiliations, positions held with the Trust, principal occupations during at least the past five years and number of U.S. registered portfolios overseen in the Franklin Templeton Investments fund complex are shown below. Generally, each board member serves until that person’s successor is elected and qualified.
|
|
|
|
|
|
|
Independent Board Members
|
|
|
|
|
|
|
|
|
|
Number of Portfolios in
|
|
|
Name, Year of Birth
|
|
Length of
|
Fund Complex Overseen
|
Other Directorships Held
|
|
and Address
|
Position
|
Time Served
|
by Board Member*
|
During at Least the Past 5 Years
|
|
Harris J. Ashton (1932)
|
Trustee
|
Since 1992
|
141
|
Bar-S Foods (meat packing company)
|
|
300 S.E. 2nd Street
|
|
|
|
(1981-2010).
|
|
Fort Lauderdale, FL 33301-1923
|
|
|
|
|
|
Principal Occupation During at Least the Past 5 Years:
|
|
|
|
Director of various companies; and
formerly,
Director, RBC Holdings, Inc. (bank holding company) (until 2002); and President, Chief
|
|
Executive Officer and Chairman of the Board, General Host Corporation (nursery and craft centers) (until 1998).
|
|
|
|
Ann Torre Bates (1958)
|
Trustee
|
Since 2008
|
38
|
SLM Corporation (Sallie Mae), Ares
|
|
300 S.E. 2nd Street
|
|
|
|
Capital Corporation (specialty finance
|
|
Fort Lauderdale, FL 33301-1923
|
|
|
|
company), Allied Capital Corporation
|
|
|
|
|
|
(financial services) (2003-2010)
|
|
|
|
|
|
and United Natural Foods, Inc.,
|
|
|
|
|
|
(October 2013).
|
|
Principal Occupation During at Least the Past 5 Years:
|
|
|
|
Director of various companies; and
formerly,
Executive Vice President and Chief Financial Officer, NHP Incorporated (manager of multifamily
|
|
housing) (1995-1997); and Vice President and Treasurer, US Airways, Inc. (until 1995).
|
|
|
|
|
Frank J. Crothers (1944)
|
Trustee
|
Since 1989
|
27
|
Talon Metals Corp. (mining explo-
|
|
300 S.E. 2nd Street
|
|
|
|
ration), Fortis, Inc. (utility holding
|
|
Fort Lauderdale, FL 33301-1923
|
|
|
|
company) and AML Foods Limited
|
|
|
|
|
|
(retail distributors).
|
|
Principal Occupation During at Least the Past 5 Years:
|
|
|
|
Director and Vice Chairman, Caribbean Utilities Company, Ltd.; director of various other private business and nonprofit organizations; and
|
|
formerly,
Chairman, Atlantic Equipment and Power Ltd. (1977-2003).
|
|
|
|
|
|
Edith E. Holiday (1952)
|
Lead
|
Trustee since
|
141
|
Hess Corporation (exploration and
|
|
300 S.E. 2nd Street
|
Independent
|
1996 and Lead
|
|
refining of oil and gas), H.J. Heinz
|
|
Fort Lauderdale, FL 33301-1923
|
Trustee
|
Independent
|
|
Company (processed foods and allied
|
|
|
|
Trustee since
|
|
products) (1994-2013), RTI
|
|
|
|
2007
|
|
International Metals, Inc. (manufac-
|
|
|
|
|
|
ture and distribution of titanium),
|
|
|
|
|
|
Canadian National Railway (railroad)
|
|
|
|
|
|
and White Mountains Insurance
|
|
|
|
|
|
Group, Ltd. (holding company).
|
|
Principal Occupation During at Least the Past 5 Years:
|
|
|
|
Director or Trustee of various companies and trusts; and
formerly,
Assistant to the President of the United States and Secretary of the
|
|
Cabinet (1990-1993); General Counsel to the United States Treasury Department (1989-1990); and Counselor to the Secretary and Assistant
|
|
Secretary for Public Affairs and Public Liaison – United States Treasury Department (1988-1989).
|
|
|
|
|
|
|
38
|
Annual Report
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of Portfolios in
|
|
|
Name, Year of Birth
|
|
|
Length of
|
Fund Complex Overseen
|
Other Directorships Held
|
|
and Address
|
|
Position
|
Time Served
|
by Board Member*
|
During at Least the Past 5 Years
|
|
J. Michael Luttig (1954)
|
|
Trustee
|
Since 2009
|
141
|
Boeing Capital Corporation (aircraft
|
|
300 S.E. 2nd Street
|
|
|
|
|
financing) (2006-2013).
|
|
Fort Lauderdale, FL 33301-1923
|
|
|
|
|
|
|
Principal Occupation During at Least the Past 5 Years:
|
|
|
|
Executive Vice President, General Counsel and member of Executive Council, The Boeing Company (aerospace company); and
formerly,
|
|
Federal Appeals Court Judge, U.S. Court of Appeals for the Fourth Circuit (1991-2006).
|
|
|
David W. Niemiec (1949)
|
|
Trustee
|
Since 2005
|
34
|
Emeritus Corporation (assisted living)
|
|
300 S.E. 2nd Street
|
|
|
|
|
(1999-2010) and OSI
|
|
Fort Lauderdale, FL 33301-1923
|
|
|
|
|
Pharmaceuticals, Inc. (pharmaceutical
|
|
|
|
|
|
|
products) (2006-2010).
|
|
Principal Occupation During at Least the Past 5 Years:
|
|
|
|
Advisor, Saratoga Partners (private equity fund); and
formerly,
Managing Director, Saratoga Partners (1998-2001) and SBC Warburg Dillon
|
|
Read (investment banking) (1997-1998); Vice Chairman, Dillon, Read & Co. Inc. (investment banking) (1991-1997); and Chief Financial
|
|
Officer, Dillon, Read & Co. Inc. (1982-1997).
|
|
|
|
|
|
|
Frank A. Olson (1932)
|
|
Trustee
|
Since 2003
|
141
|
Hess Corporation (exploration and
|
|
300 S.E. 2nd Street
|
|
|
|
|
refining of oil and gas) (1998-2013).
|
|
Fort Lauderdale, FL 33301-1923
|
|
|
|
|
|
|
Principal Occupation During at Least the Past 5 Years:
|
|
|
|
Chairman Emeritus, The Hertz Corporation (car rental) (since 2000) (Chairman of the Board (1980-2000) and Chief Executive Officer
|
|
(1977-1999)); and
formerly,
Chairman of the Board, President and Chief Executive Officer, UAL Corporation (airlines) (until 1987).
|
|
|
|
Larry D. Thompson (1945)
|
|
Trustee
|
Since 2006
|
141
|
Cbeyond, Inc. (business communica-
|
|
300 S.E. 2nd Street
|
|
|
|
|
tions provider) (2010-2012), The
|
|
Fort Lauderdale, FL 33301-1923
|
|
|
|
|
Southern Company (energy company)
|
|
|
|
|
|
|
(2010-2012) and The Washington
|
|
|
|
|
|
|
Post Company (education and media
|
|
|
|
|
|
|
organization).
|
|
Principal Occupation During at Least the Past 5 Years:
|
|
|
|
Executive Vice President – Government Affairs, General Counsel and Corporate Secretary, PepsiCo, Inc. (consumer products) (June 2012);
|
|
and
formerly,
John A. Sibley Professor of Corporate and Business Law, University of Georgia School of Law (2011-2012); Senior Vice
|
|
President – Government Affairs, General Counsel and Secretary, PepsiCo, Inc. (2004-2011); Senior Fellow of The Brookings Institution
|
|
(2003-2004); Visiting Professor, University of Georgia School of Law (2004); and Deputy Attorney General, U.S. Department of Justice
|
|
(2001-2003).
|
|
|
|
|
|
|
|
|
Constantine D. Tseretopoulos
|
|
Trustee
|
Since 1989
|
27
|
None
|
|
(1954
|
)
|
|
|
|
|
|
300 S.E. 2nd Street
|
|
|
|
|
|
|
Fort Lauderdale, FL 33301-1923
|
|
|
|
|
|
|
Principal Occupation During at Least the Past 5 Years:
|
|
|
|
Physician, Chief of Staff, owner and operator of the Lyford Cay Hospital (1987-present); director of various nonprofit organizations; and
|
|
formerly,
Cardiology Fellow, University of Maryland (1985-1987); and Internal Medicine Resident, Greater Baltimore Medical Center
|
|
(1982-1985).
|
|
|
|
|
|
|
Robert E. Wade (1946)
|
|
Trustee
|
Since 2006
|
45
|
El Oro Ltd (investments).
|
|
300 S.E. 2nd Street
|
|
|
|
|
|
|
Fort Lauderdale, FL 33301-1923
|
|
|
|
|
|
|
Principal Occupation During at Least the Past 5 Years:
|
|
|
|
Attorney at law engaged in private practice (1972-2008) and member of various boards.
|
|
Annual Report
|
39
|
|
|
|
|
|
|
Interested Board Members and Officers
|
|
|
|
|
|
|
|
|
Number of Portfolios in
|
|
|
Name, Year of Birth
|
|
Length of
|
Fund Complex Overseen
|
Other Directorships Held
|
|
and Address
|
Position
|
Time Served
|
by Board Member*
|
During at Least the Past 5 Years
|
|
**Gregory E. Johnson (1961)
|
Trustee
|
Since June 2013
|
152
|
None
|
|
One Franklin Parkway
|
|
|
|
|
|
San Mateo, CA 94403-1906
|
|
|
|
|
|
Principal Occupation During at Least the Past 5 Years:
|
|
|
|
Chairman of the Board, Member – Office of the Chairman, Director, President and Chief Executive Officer, Franklin Resources, Inc.; officer
|
|
and/or director or trustee, as the case may be, of some of the other subsidiaries of Franklin Resources, Inc. and of 44 of the investment
|
|
companies in Franklin Templeton Investments; and Chairman, Investment Company Institute.
|
|
|
**Rupert H. Johnson, Jr. (1940)
|
Chairman of
|
Chairman of the
|
141
|
None
|
|
One Franklin Parkway
|
the Board,
|
Board since June
|
|
|
|
San Mateo, CA 94403-1906
|
Trustee and
|
2013, Trustee
|
|
|
|
|
Vice President
|
since 1993 and
|
|
|
|
|
|
Vice President
|
|
|
|
|
|
since 1996
|
|
|
|
Principal Occupation During at Least the Past 5 Years:
|
|
|
|
Vice Chairman, Member – Office of the Chairman and Director, Franklin Resources, Inc.; Director, Franklin Advisers, Inc.; Senior Vice
|
|
President, Franklin Advisory Services, LLC; and officer and/or director or trustee, as the case may be, of some of the other subsidiaries of
|
|
Franklin Resources, Inc. and of 41 of the investment companies in Franklin Templeton Investments.
|
|
|
|
|
Alison E. Baur (1964)
|
Vice President
|
Since 2012
|
Not Applicable
|
Not Applicable
|
|
One Franklin Parkway
|
|
|
|
|
|
San Mateo, CA 94403-1906
|
|
|
|
|
|
Principal Occupation During at Least the Past 5 Years:
|
|
|
|
Deputy General Counsel, Franklin Templeton Investments; and officer of some of the other subsidiaries of Franklin Resources, Inc. and of 46
|
|
of the investment companies in Franklin Templeton Investments.
|
|
|
|
|
|
Norman J. Boersma (1957)
|
President and
|
Since 2012
|
Not Applicable
|
Not Applicable
|
|
Lyford Cay
|
Chief Executive
|
|
|
|
|
Nassau, Bahamas
|
Officer –
|
|
|
|
|
|
Investment
|
|
|
|
|
|
Management
|
|
|
|
|
Principal Occupation During at Least the Past 5 Years:
|
|
|
|
Director, President and Chief Executive Officer, Templeton Global Advisors Ltd.; Executive Vice President/Director of Research, Franklin
|
|
Templeton Investment Corp.; Chief Investment Officer of Templeton Global Equity Group; and officer of six of the investment companies in
|
|
Franklin Templeton Investments.
|
|
|
|
|
|
|
|
Laura F. Fergerson (1962)
|
Chief Executive
|
Since 2009
|
Not Applicable
|
Not Applicable
|
|
One Franklin Parkway
|
Officer –
|
|
|
|
|
San Mateo, CA 94403-1906
|
Finance and
|
|
|
|
|
|
Administration
|
|
|
|
|
Principal Occupation During at Least the Past 5 Years:
|
|
|
|
Senior Vice President, Franklin Templeton Services, LLC; and officer of 46 of the investment companies in Franklin Templeton Investments.
|
40
|
Annual Report
|
|
|
|
|
|
|
|
|
|
Number of Portfolios in
|
|
|
Name, Year of Birth
|
|
Length of
|
Fund Complex Overseen
|
Other Directorships Held
|
|
and Address
|
Position
|
Time Served
|
by Board Member*
|
During at Least the Past 5 Years
|
|
Aliya S. Gordon (1973)
|
Vice President
|
Since 2009
|
Not Applicable
|
Not Applicable
|
|
One Franklin Parkway
|
|
|
|
|
|
San Mateo, CA 94403-1906
|
|
|
|
|
|
Principal Occupation During at Least the Past 5 Years:
|
|
|
|
Senior Associate General Counsel, Franklin Templeton Investments; officer of 46 of the investment companies in Franklin Templeton
|
|
Investments; and
formerly,
Litigation Associate, Steefel, Levitt & Weiss, LLP (2000-2004).
|
|
|
|
|
Steven J. Gray (1955)
|
Vice President
|
Since 2009
|
Not Applicable
|
Not Applicable
|
|
One Franklin Parkway
|
|
|
|
|
|
San Mateo, CA 94403-1906
|
|
|
|
|
|
Principal Occupation During at Least the Past 5 Years:
|
|
|
|
Senior Associate General Counsel, Franklin Templeton Investments; Vice President, Franklin Templeton Distributors, Inc.; and officer of 46 of
|
|
the investment companies in Franklin Templeton Investments.
|
|
|
|
|
|
Selena L. Holmes (1965)
|
Vice President
|
Since 2012
|
Not Applicable
|
Not Applicable
|
|
100 Fountain Parkway
|
– AML
|
|
|
|
|
St. Petersburg, FL 33716-1205
|
Compliance
|
|
|
|
|
Principal Occupation During at Least the Past 5 Years:
|
|
|
|
Director, Global Compliance Monitoring; and officer of 46 of the investment companies in Franklin Templeton Investments.
|
|
|
|
Kimberly H. Novotny (1972)
|
Vice President
|
Since March 2013
|
Not Applicable
|
Not Applicable
|
|
300 S.E. 2nd Street
|
|
|
|
|
|
Fort Lauderdale, FL 33301-1923
|
|
|
|
|
|
Principal Occupation During at Least the Past 5 Years:
|
|
|
|
Associate General Counsel, Franklin Templeton Investments; Vice President and Secretary, Fiduciary Trust International of the South; Vice
|
|
President, Templeton Investment Counsel, LLC; Assistant Secretary, Franklin Resources, Inc.; and officer of 46 of the investment companies
|
|
in Franklin Templeton Investments.
|
|
|
|
|
|
|
Mark H. Otani (1968)
|
Treasurer,
|
Since 2009
|
Not Applicable
|
Not Applicable
|
|
One Franklin Parkway
|
Chief Financial
|
|
|
|
|
San Mateo, CA 94403-1906
|
Officer and
|
|
|
|
|
|
Chief
|
|
|
|
|
|
Accounting
|
|
|
|
|
|
Officer
|
|
|
|
|
Principal Occupation During at Least the Past 5 Years:
|
|
|
|
Director, Global Fund Accounting Operations, Franklin Templeton Investments; and officer of 14 of the investment companies in Franklin
|
|
Templeton Investments.
|
|
|
|
|
|
|
|
Robert C. Rosselot (1960)
|
Chief
|
Since March 2013
|
Not Applicable
|
Not Applicable
|
|
300 S.E. 2nd Street
|
Compliance
|
|
|
|
|
Fort Lauderdale, FL 33301-1923
|
Officer
|
|
|
|
|
|
|
Principal Occupation During at Least the Past 5 Years:
|
|
|
|
Director, Global Compliance, Franklin Templeton Investments; officer of 46 of the investment companies in Franklin Templeton Investments;
|
|
and
formerly,
Senior Associate General Counsel, Franklin Templeton Investments (2007-2013); and Secretary and Vice President, Templeton
|
|
Group of Funds (2004-2013).
|
|
|
|
|
Annual Report
|
41
|
|
|
|
|
|
|
|
|
|
Number of Portfolios in
|
|
|
Name, Year of Birth
|
|
Length of
|
Fund Complex Overseen
|
Other Directorships Held
|
|
and Address
|
Position
|
Time Served
|
by Board Member*
|
During at Least the Past 5 Years
|
|
Karen L. Skidmore (1952)
|
Vice President
|
Since 2009
|
Not Applicable
|
Not Applicable
|
|
One Franklin Parkway
|
|
|
|
|
|
San Mateo, CA 94403-1906
|
|
|
|
|
|
Principal Occupation During at Least the Past 5 Years:
|
|
|
|
Senior Associate General Counsel, Franklin Templeton Investments; and officer of 46 of the investment companies in Franklin Templeton
|
|
Investments.
|
|
|
|
|
|
|
|
Craig S. Tyle (1960)
|
Vice President
|
Since 2005
|
Not Applicable
|
Not Applicable
|
|
One Franklin Parkway
|
|
|
|
|
|
San Mateo, CA 94403-1906
|
|
|
|
|
|
Principal Occupation During at Least the Past 5 Years:
|
|
|
|
General Counsel and Executive Vice President, Franklin Resources, Inc.; and officer of some of the other subsidiaries of Franklin Resources,
|
|
Inc. and of 46 of the investment companies in Franklin Templeton Investments.
|
|
|
|
|
Lori A. Weber (1964)
|
Secretary and
|
Secretary since
|
Not Applicable
|
Not Applicable
|
|
300 S.E. 2nd Street
|
Vice President
|
March 2013 and
|
|
|
|
Fort Lauderdale, FL 33301-1923
|
|
Vice President
|
|
|
|
|
|
since 2011
|
|
|
|
Principal Occupation During at Least the Past 5 Years:
|
|
|
|
Senior Associate General Counsel, Franklin Templeton Investments; Assistant Secretary, Franklin Resources, Inc.; Vice President and
|
|
Secretary, Templeton Investment Counsel, LLC; Vice President, Fiduciary Trust International of the South; and officer of 46 of the investment
|
|
companies in Franklin Templeton Investments.
|
|
|
|
*We base the number of portfolios on each separate series of the U.S. registered investment companies within the Franklin Templeton Investments fund complex. These portfolios
have a common investment manager or affiliated investment managers.
** Gregory E. Johnson is considered to be an interested person of the Fund under the federal securities laws due to his position as an officer and director of Franklin Resources, Inc.
(Resources), which is the parent company of the Fund’s investment manager and distributor. Rupert H. Johnson, Jr. is considered to be an interested person of the Fund under the
federal securities laws due to his position as officer and director and major shareholder of Resources.
Note 1: Rupert H. Johnson, Jr. is the uncle of Gregory E. Johnson.
Note 2: Officer information is current as of the date of this report. It is possible that after this date, information about officers may change.
Note 3: Effective June 13, 2013, Charles B. Johnson ceased to be a trustee of the Fund
The Sarbanes-Oxley Act of 2002 and Rules adopted by the U.S. Securities and Exchange Commission require the Fund to disclose whether the Fund’s Audit Committee
includes at least one member who is an audit committee financial expert within the meaning of such Act and Rules. The Fund’s Board has determined that there is at least
one such financial expert on the Audit Committee and has designated each of Ann Torre Bates and David W. Niemiec as an audit committee financial expert. The Board
believes that Ms. Bates and Mr. Niemiec qualify as such an expert in view of their extensive business background and experience. Ms. Bates has served as a member of the
Fund Audit Committee since 2008. She currently serves as a director of SLM Corporation and Ares Capital Corporation and was formerly a director of Allied Capital
Corporation from 2003 to 2010, Executive Vice President and Chief Financial Officer of NHP Incorporated, and Vice President and Treasurer of US Airways, Inc. Mr. Niemiec
has served as a member of the Fund Audit Committee since 2005, currently serves as an Advisor to Saratoga Partners and was formerly its Managing Director from 1998 to
2001. Mr. Niemiec was formerly a director of Emeritus Corporation from 1999 to 2010 and OSI Pharmaceuticals, Inc. from 2006 to 2010, Managing Director of SBC Warburg
Dillon Read from 1997 to 1998, and was Vice Chairman from 1991 to 1997 and Chief Financial Officer from 1982 to 1997 of Dillon, Read & Co. Inc. As a result of such back-
ground and experience, the Board believes that Ms. Bates and Mr. Niemiec have each acquired an understanding of generally accepted accounting principles and financial
statements, the general application of such principles in connection with the accounting estimates, accruals and reserves, and analyzing and evaluating financial state-
ments that present a breadth and level of complexity of accounting issues generally comparable to those of the Fund, as well as an understanding of internal controls and
procedures for financial reporting and an understanding of audit committee functions. Ms. Bates and Mr. Niemiec are independent Board members as that term is defined
under the applicable U.S. Securities and Exchange Commission Rules and Releases.
The Statement of Additional Information (SAI) includes additional information about the board members and is available, without charge, upon request. Shareholders may
call (800) DIAL BEN/342-5236 to request the SAI.
42
|
Annual Report
Templeton Global Opportunities Trust
Shareholder Information
Proxy Voting Policies and Procedures
The Trust’s investment manager has established Proxy Voting Policies and Procedures (Policies) that the Trust uses to determine how to vote proxies relating to portfolio securities. Shareholders may view the Trust’s complete Policies online at franklintempleton.com. Alternatively, shareholders may request copies of the Policies free of charge by calling the Proxy Group collect at (954) 527-7678 or by sending a written request to: Franklin Templeton Companies, LLC, 300 S.E. 2nd Street, Fort Lauderdale, FL 33301, Attention: Proxy Group. Copies of the Trust’s proxy voting records are also made available online at franklintempleton.com and posted on the U.S. Securities and Exchange Commission’s website at sec.gov and reflect the most recent 12-month period ended June 30.
Quarterly Statement of Investments
The Trust files a complete statement of investments with the U.S. Securities and Exchange Commission for the first and third quarters for each fiscal year on Form N-Q. Shareholders may view the filed Form N-Q by visiting the Commission’s website at sec.gov. The filed form may also be viewed and copied at the Commission’s Public Reference Room in Washington, DC. Information regarding the operations of the Public Reference Room may be obtained by calling (800) SEC-0330.
Householding of Reports and Prospectuses
You will receive the Fund’s financial reports every six months as well as an annual updated summary prospectus (prospectus available upon request). To reduce Fund expenses, we try to identify related shareholders in a household and send only one copy of the financial reports and summary prospectus. This process, called “householding,” will continue indefinitely unless you instruct us otherwise. If you prefer not to have these documents householded, please call us at (800) 632-2301. At any time you may view current prospectuses/summary prospectuses and financial reports on our website. If you choose, you may receive these documents through electronic delivery.
Annual Report
|
43
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|
|
|
|
Annual Report and Shareholder Letter
|
|
|
|
|
Te
mpleton
|
|
|
G
lobal
O
pportunities
Tr
ust
|
|
|
|
|
|
|
Investment Manager
|
|
|
Templeton Investment Counsel, LLC
|
|
|
|
|
Subadvisors
|
|
|
Franklin Templeton Investments (Asia) Limited
|
|
|
Templeton Asset Management Ltd.
|
|
|
|
|
Distributor
|
|
|
Franklin Templeton Distributors, Inc.
|
|
|
(800) DIAL BEN
®
/342-5236
|
|
|
franklintempleton.com
|
|
|
|
|
Shareholder Services
|
|
|
(800) 632-2301
|
|
|
|
|
|
|
|
|
Authorized for distribution only when accompanied or preceded by a summary prospectus and/or prospectus.
|
|
Investors should carefully consider a fund’s investment goals, risks, charges and expenses before investing.
|
|
A prospectus contains this and other information; please read it carefully before investing.
|
|
|
To ensure the highest quality of service, telephone calls to or from our service departments may be monitored, recorded and
|
|
accessed. These calls can be identified by the presence of a regular beeping tone.
|
|
|
© 2014 Franklin Templeton Investments. All rights reserved.
|
415 A 02/14
|
Item 2. Code of Ethics.
(a) The Registrant has adopted a code of ethics that applies to its principal executive officers and principal financial and accounting officer.
(c) N/A
(d) N/A
(f) Pursuant to Item 12 (a)(1), the Registrant is attaching as an exhibit a copy of its code of ethics that applies to its principal executive officers and principal financial and accounting officer.
Item 3. Audit Committee Financial Expert.
(a)(1) The Registrant has an audit committee financial expert serving on its audit committee.
(2) The audit committee financial expert is David W. Niemiec and he is "independent" as defined under the relevant Securities and Exchange Commission Rules and Releases.
Item 4. Principal Accountant Fees and Services.
(a) Audit Fees
The aggregate fees paid to the principal accountant for professional services rendered by the principal accountant for the audit of the registrant’s annual financial statements or for services that are normally provided by the principal accountant in connection with statutory and regulatory filings or engagements were $41,788 for the fiscal year ended December 31, 2013 and $42,545 for the fiscal year ended December 31, 2012.
(b) Audit-Related Fees
The aggregate fees paid to the principal accountant for assurance and related services rendered by the principal accountant to the registrant that are reasonably related to the performance of the audit of the registrant's financial statements and are not reported under paragraph (a) of Item 4 were $2,894 for the fiscal year ended December 31, 2013 and $2,894 for the fiscal year ended December 31, 2012. The services for which these fees were paid included attestation services.
There were no fees paid to the principal accountant for assurance and related services rendered by the principal accountant to the registrant's investment adviser and any entity controlling, controlled by or under common control with the investment adviser that provides ongoing services to the registrant that are reasonably related to the performance of the audit of their financial statements.
(c) Tax Fees
There were no fees paid to the principal accountant for professional services rendered by the principal accountant to the registrant for tax compliance, tax advice and tax planning.
The aggregate fees paid to the principal accountant for professional services rendered by the principal accountant to the registrant’s
investment adviser and any entity controlling, controlled by or under common control with the investment adviser that provides ongoing services to the registrant for tax compliance, tax advice and tax planning were $6,930 for the fiscal year ended December 31, 2013 and $4,600 for the fiscal year ended December 31, 2012. The services for which these fees were paid included technical tax consultation for capital gain tax reporting for foreign governments and requirements on local country’s self certification forms.
(d) All Other Fees
The aggregate fees paid to the principal accountant for products and services rendered by the principal accountant to the registrant not reported in paragraphs (a)-(c) of Item 4 were $0 for the fiscal year ended December 31, 2013 and $252 for the fiscal year ended December 31, 2012. The services for which these fees were paid include review of materials provided to the fund Board in connection with the investment management contract renewal process.
The aggregate fees paid to the principal accountant for products and services rendered by the principal accountant to the registrant’s investment adviser and any entity controlling, controlled by or under common control with the investment adviser that provides ongoing services to the registrant other than services reported in paragraphs (a)-(c) of Item 4 were $44,069 for the fiscal year ended December 31, 2013 and $452,198 for the fiscal year ended December 31, 2012. The services for which these fees were paid included preparation and review of materials provided to the fund Board in connection with the investment management contract renewal process and certifying asset under management.
(e) (1) The registrant’s audit committee is directly responsible for approving the services to be provided by the auditors, including:
(i) pre-approval of all audit and audit related services;
(ii) pre-approval of all non-audit related services to be provided to the Fund by the auditors;
(iii) pre-approval of all non-audit related services to be provided to the registrant by the auditors to the registrant’s investment adviser or to any entity that controls, is controlled by or is under common control with the registrant’s investment adviser and that provides ongoing services to the registrant where the non-audit services relate directly to the operations or financial reporting of the registrant; and
(iv) establishment by the audit committee, if deemed necessary or appropriate, as an alternative to committee pre-approval of services to be provided by the auditors, as required by paragraphs (ii) and (iii) above, of policies and procedures to permit such services to be pre-approved by other means, such as through establishment of guidelines or by action of a designated member or members of the committee; provided the policies and procedures are detailed as to the particular service and the committee is informed of each service and such policies and procedures do not include delegation of audit committee responsibilities, as contemplated under the Securities Exchange Act of 1934, to management; subject, in the case of (ii)
through (iv), to any waivers, exceptions or exemptions that may be available under applicable law or rules.
(e) (2) None of the services provided to the registrant described in paragraphs (b)-(d) of Item 4 were approved by the audit committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of regulation S-X.
(f) No disclosures are required by this Item 4(f).
(g) The aggregate non-audit fees paid to the principal accountant for services rendered by the principal accountant to the registrant and the registrant’s investment adviser and any entity controlling, controlled by or under common control with the investment adviser that provides ongoing services to the registrant were $53,893 for the fiscal year ended December 31, 2013 and $459,944 for the fiscal year ended December 31, 2012.
(h) The registrant’s audit committee of the board has considered whether the provision of non-audit services that were rendered to the registrant’s investment adviser (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser), and any entity controlling, controlled by, or under common control with the investment adviser that provides ongoing services to the registrant that were not pre-approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X is compatible with maintaining the principal accountant’s independence.
Item 5. Audit Committee of Listed Registrants.
N/A
Item 6. Schedule of Investments. N/A
Item 7
.
Disclosure of Proxy Voting Policies and Procedures for
Closed-End Management Investment Companies. N/A
Item 8. Portfolio Managers of Closed-End Management Investment Companies. N/A
Item 9
.
Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers. N/A
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 that would require disclosure herein.
Item 11. Controls and Procedures.
(a)
Evaluation of Disclosure Controls and Procedures
. The Registrant maintains disclosure controls and procedures that are designed to
ensure that information required to be disclosed in the Registrant’s filings under the Securities Exchange Act of 1934 and the Investment Company Act of 1940 is recorded, processed, summarized and reported within the periods specified in the rules and forms of the Securities and Exchange Commission. Such information is accumulated and communicated to the Registrant’s management, including its principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. The Registrant’s management, including the principal executive officer and the principal financial officer, recognizes that any set of controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives.
Within 90 days prior to the filing date of this Shareholder Report on Form N-CSR, the Registrant had carried out an evaluation, under the supervision and with the participation of the Registrant’s management, including the Registrant’s principal executive officer and the Registrant’s principal financial officer, of the effectiveness of the design and operation of the Registrant’s disclosure controls and procedures. Based on such evaluation, the Registrant’s principal executive officer and principal financial officer concluded that the Registrant’s disclosure controls and procedures are effective.
(b)
Changes in Internal Controls
. There have been no changes in the Registrant’s internal controls or in other factors that could materially affect the internal controls over financial reporting subsequent to the date of their evaluation in connection with the preparation of this Shareholder Report on Form N-CSR.
Item 12. Exhibits.
(a)(1)
Code of Ethics
(a) (2) Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 of Laura F. Fergerson, Chief Executive Officer - Finance and Administration, and Mark H. Otani, Chief Financial Officer and Chief Accounting Officer
(b) Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 of Laura F. Fergerson, Chief Executive Officer - Finance and Administration, and Mark H. Otani, Chief Financial Officer and Chief Accounting Officer
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.
TEMPLETON
GLOBAL OPPORTUNITIES TRUST
By
/s/LAURA F. FERGERSON
Laura F. Fergerson
Chief
Executive Officer –
Finance and Administration
Date
February 27, 2014
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
/s/LAURA F. FERGERSON
Laura F. Fergerson
Chief
Executive Officer –
Finance and Administration
Date
February 27, 2014
By
/s/MARK H. OTANI
Mark H. Otani
Chief Financial Officer and
Chief Accounting Officer
Date
February 27, 2014
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