An asset review by responsible entity BalmainTRILOGY has found that there is no significant cash income being earned by Pacific First Mortgage Fund (PFMF), formerly known as the City Pacific First Mortgage Fund.

According to BalmainTRILOGY joint chief executive Andrew Griffin, the asset review has found that a substantial majority of the loans in the portfolio were in default.

"As a consequence it is going to take time and a great deal of effort to get PFMF reworked in the interests of unitholders," Griffin said.

"We know that this is a difficult situation for unitholders who are keen to know the future of their fund and are wanting answers as soon as possible.

"We are confident that the thick veil that previously shrouded the affairs of the fund will be removed once and for all in the very near future."

BalmainTRILOGY also advised that it is still continuing with a legal review and will soon inform unitholders of proposed recovery actions.

The tax statements for members' individual investments in the PFMF have been sent to all unitholders so they can complete their 2008/09 tax returns.

Meanwhile, ASIC have given BalmainTRILOGY an extension for the time it has to prepare and lodge financial statements for PFMF for the financial year to 30 June 2009 from 30 September 2009 to 15 November 2009.

BalmainTRILOGY joint chief executive Rodger Bacon said the responsibility for the 2008/09 accounts actually rested with City Pacific Limited (CPL).

BalmainTRILOGY was confirmed as the new manager of PFMF on 20 July and took responsibility for the accounts because CPL went into receivership and then liquidation.