Carlyle Credit Income Fund (CCIF) N-CSR Certified annual shareholder report (management investment company)

united states
securities and exchange commission
washington, d.c. 20549

form n-csr

certified shareholder report of registered management
investment companies

Investment Company Act file number 811-22554

Vertical Capital Income Fund

(Exact name of registrant as specified in charter)

80 Arkay Drive, Hauppauge, NY 11788

(Address of principal executive offices) (Zip code)

Richard Malinowski, Gemini Fund Services, LLC

17605 Wright Street, Omaha, Nebraska, 68130

(Name and address of agent for service)

Registrant's telephone number, including area code: 631-470-2734

Date of fiscal year end: 9/30

Date of reporting period: 9/30/16

Item 1. Reports to Stockholders.

Vertical Capital Income Fund

Cusip: 92535C104

VCAPX

Annual Report

September 30, 2016

Investor Information: 1-866-277-VCIF

This report and the financial statements contained herein are submitted for the general information of shareholders and are not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus. Nothing contained herein is to be considered an offer of sale or solicitation of an offer to buy shares of the Vertical Capital Income Fund. Such offering is made only by prospectus, which includes details as to offering price and other material information.

Distributed by Northern Lights Distributors, LLC
Member FINRA

March 21, 2017

Dear Shareholders:

We are pleased to report the completion of another successful year for the Vertical Capital Income Fund (the “Fund”). Consistent with our investment objective to seek income, the Fund once again made continuous monthly distributions for each of the last twelve months of its fiscal year ending September 30, 2016. During the same period, the Fund produced a total return (load waived) of 15.10% compared to one of its key benchmarks, the Barclays Capital Mortgage Backed Securities Index (the “Barclays Index”), which had a total return of 3.61%. Including the maximum load of 4.50%, the Fund had a total return of 9.94%. Since inception the Fund has produced a cumulative total return of 9.74% (load waived) and 8.69% (including the maximum load). This compares to 2.60% for the Barclays Index. The SEC Annual Yield was 1.72% as measured on September 30, 2016.

Investment Strategy

The Fund’s investment strategy is to purchase performing first lien residential mortgages at a discount to their unpaid principal balances (UPB). The Fund’s current distributions are supported from the receipt of monthly interest payments, after payment of the Fund’s operating expenses. The Fund’s annual total return includes its current earnings plus any unrealized gains or losses in the estimated value of the Fund’s investments, or realized gains or losses when a loan is paid off or sold for more, or less, than its carrying value.

The Fund continues to have ample acquisition opportunities as these are generated, in part, from new purchase mortgage originations, refinance originations, loan modifications, short-term loans and, in part, from trading activity among secondary market participants. At the end of 2016 the one-to-four family residences market in which the Fund invests had $10.2 trillion of outstanding loans, of which $837 billion were owned by non-institutional or government-related holders. Total originations were almost $1.9 trillion in 2016 and are generally expected to decrease to about $1.6 trillion, a number that’s in line with historical stabilized market levels. New purchase originations in 2017 are estimated to increase by 10% as the U.S. continues to have strong household formation coupled with future job and wage growth and continuing home price appreciation, whereas refinance originations are estimated to be lower as interest rates are expected to rise .

During the fiscal year we acquired 148 loans with the following average characteristics: 79.7% price to UPB, 63.0% loan to value, 4.5% coupon, 5.7% effective rate and a FICO score of 665. Each of these metrics compares favorably to the portfolio averages as a whole as of September 30, 2016: 80.1% price to UPB, 73.5% price to updated real estate value, 4.2% coupon, 5.5% effective rate and a FICO score of 663. We attribute the improvement in acquisition metrics to our constant search for new selling relationships and buying opportunities and our strict adherence to an investment process that results in acquiring only the most attractive risk-adjusted loans at price levels where we want to own them.

1 

Macroeconomic and Housing Market Outlook

Economic growth continues to advance at a slow but positive pace, generally in the 2% range; with wage growth slightly higher at 2.5%. Inflation has been a concern of the Federal Reserve and most experts assume that the Fed will raise short-term interest rates two to four times during 2017. The Fed is also expected to decrease the size of its balance sheet which could impact its purchases of mortgage-backed securities and longer term Treasuries, a significant factor in the marketplace since the economic downturn. There is also a continued shortage of housing, especially at the affordable end of the market, that will not be remedied during 2017, so we are confident that we will continue to see ample investment opportunities at attractive prices going forward.

Fund Results of Operations and Liquidity

The Fund continued its track record of making continuous monthly cash dividends that were fully covered by operating earnings; and, like prior years, ended the year in a positive net working capital position. The Fund raised $44.4 million from the sale of equity shares, including the DRIP, and obtained another $22.1 million from loans sales and loan prepayments. The Fund invested $23.3 million in new investments and funded redemptions totaling $36.1 million.

In conclusion, we are pleased with the Fund’s performance for the fiscal year and believe there are many reasons to be optimistic about the future.

We thank you for your investment in Vertical Capital Income Fund.

Regards,

Robert J. Chapman
Chairman of the Board of Trustees and Co-Portfolio Manager

David Aisner
Co-Portfolio Manager

2 

Vertical Capital Income Fund

PERFORMANCE OF A $10,000 INVESTMENT (Unaudited)

Since Inception through September 30, 2016*

	One Year	Since Inception*
The Vertical Capital Income Fund	15.10%	9.74%
The Vertical Capital Income Fund with load	9.94%	8.68%
Barclays Capital Mortgage Backed Securities Index	3.61%	2.60%

* The Fund commenced operations on December 30, 2011. The performance of the Fund is based on average annual returns.

The Barclays Capital Mortgage Backed Securities Index is an unmanaged index composed of securities backed by mortgage pools of Ginnie Mae, Freddie Mac and Fannie Mae. Investors can not invest directly in an index or benchmark.

Past performance is not predictive of future results. The investment return and principal value of an investment will fluctuate. An investor’s shares, when redeemed, may be worth more or less than the original cost. Total return is calculated assuming reinvestment of all dividends and distributions. Total returns would have been lower had the Adviser not waived its fees and reimbursed a portion of the Fund’s expenses. The Fund’s total gross annual operating expenses, is 2.67% per the December 18, 2015 Prospectus. The graph does not reflect the deduction of taxes that a shareholder would have to pay on Fund distributions or the redemption of the Fund shares. For performance information current to the most recent month -end,please call 1-866-277-VCIF.

PORTFOLIO COMPOSITION** (Unaudited)
Mortgage Notes	99.8	%
Other Investments	0.2	%
	100.0	%
**  Based on Investments at Value as of September 30, 2016.

3 

Vertical Capital Income Fund

PORTFOLIO OF INVESTMENTS

September 30, 2016

Principal			Loan Type	Interest Rate	Maturity	Value
		MORTGAGE NOTES - 93.2%
$	120,108	Loan ID 200003	Fixed	7.250%	9/1/2035	$	111,716
	270,086	Loan ID 200004	Fixed	7.990%	10/1/2036		283,590
	69,619	Loan ID 200006	ARM	7.990%	1/1/2036		73,100
	51,127	Loan ID 200008	ARM	4.250%	3/28/2035		53,683
	51,369	Loan ID 200012	ARM	9.800%	7/1/2037		44,547
	56,984	Loan ID 200013	Fixed	5.250%	9/1/2040		55,765
	38,401	Loan ID 200015	Fixed	7.000%	8/1/2030		11,993
	39,779	Loan ID 200016	ARM	10.375%	1/1/2031		41,768
	53,446	Loan ID 200018	Fixed	7.000%	1/1/2033		52,736
	61,290	Loan ID 200019	Fixed	5.000%	12/1/2036		53,736
	77,385	Loan ID 200020	Fixed	5.630%	7/1/2033		81,254
	100,651	Loan ID 200023	Fixed	5.875%	12/1/2050		83,276
	134,130	Loan ID 200025	ARM	3.375%	3/1/2034		140,837
	205,980	Loan ID 200026	Interest Only	4.750%	1/1/2050		109,730
	228,102	Loan ID 200028	Interest Only	4.750%	6/1/2050		202,177
	217,913	Loan ID 200029	Fixed	6.310%	7/1/2037		167,714
	279,709	Loan ID 200031	Fixed	5.000%	1/1/2051		293,695
	338,589	Loan ID 200032	Fixed	3.130%	1/1/2051		327,260
	561,834	Loan ID 200035	Fixed	4.000%	11/1/2050		445,110
	66,954	Loan ID 200036	Fixed	7.940%	1/12/2034		70,302
	164,743	Loan ID 200037	Fixed	7.800%	5/1/2035		172,980
	121,768	Loan ID 200041	Fixed	4.875%	8/1/2039		127,856
	41,678	Loan ID 200042	Fixed	7.000%	12/1/2037		43,762
	63,243	Loan ID 200043	Fixed	6.125%	7/1/2039		66,405
	121,293	Loan ID 200045	Fixed	5.625%	12/1/2038		127,358
	38,441	Loan ID 200046	Fixed	8.000%	7/1/2027		38,441
	53,344	Loan ID 200048	Fixed	5.500%	8/1/2039		56,011
	89,285	Loan ID 200051	Fixed	8.150%	11/1/2034		25,802
	158,684	Loan ID 200052	Fixed	5.125%	5/1/2040		166,618
	61,149	Loan ID 200053	Fixed	5.000%	9/1/2042		30,967
	56,042	Loan ID 200054	Fixed	8.250%	3/1/2039		58,844
	83,863	Loan ID 200055	Fixed	10.000%	1/5/2036		88,056
	127,883	Loan ID 200057	ARM	3.125%	10/1/2036		107,431
	59,855	Loan ID 200059	Fixed	6.000%	8/1/2039		29,931
	35,135	Loan ID 200060	Fixed	5.750%	8/1/2039		36,892
	31,141	Loan ID 200061	Fixed	5.750%	7/1/2024		32,698
	26,553	Loan ID 200065	ARM	7.500%	1/1/2037		27,880
	222,319	Loan ID 200072	Fixed	0.000%	2/1/2051		233,435
	168,535	Loan ID 200073	Fixed	0.000%	2/1/2026		176,962
	157,266	Loan ID 200074	Fixed	0.000%	2/1/2031		165,129
	205,360	Loan ID 200075	Fixed	4.250%	2/1/2042		215,629
	171,640	Loan ID 200076	Fixed	4.250%	12/1/2041		139,416
	73,524	Loan ID 200077	Fixed	3.750%	8/1/2042		76,169
	32,748	Loan ID 200078	Fixed	7.000%	8/1/2036		32,296

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

4 

Vertical Capital Income Fund

PORTFOLIO OF INVESTMENTS (Continued)

September 30, 2016

Principal			Loan Type	Interest Rate	Maturity	Value
		MORTGAGE NOTES (Continued) - 93.2 %
$	135,816	Loan ID 200079	Fixed	2.000%	8/1/2049	$	44,252
	138,151	Loan ID 200081	Fixed	2.000%	9/1/2037		45,100
	68,203	Loan ID 200082	Fixed	8.250%	4/1/2040		62,001
	187,530	Loan ID 200084	Fixed	7.000%	3/1/2039		164,198
	198,242	Loan ID 200086	Fixed	3.000%	11/1/2050		108,975
	224,564	Loan ID 200087	Fixed	5.000%	3/1/2051		145,347
	124,118	Loan ID 200088	Fixed	7.000%	6/1/2039		108,460
	269,541	Loan ID 200089	Fixed	2.000%	3/1/2052		174,693
	274,810	Loan ID 200090	Fixed	2.000%	11/1/2036		65,571
	285,613	Loan ID 200091	Fixed	2.000%	11/1/2051		210,696
	260,658	Loan ID 200092	Fixed	3.380%	5/1/2036		169,709
	135,491	Loan ID 200093	Fixed	5.000%	2/1/2038		134,705
	234,518	Loan ID 200094	ARM	3.375%	9/1/2037		165,679
	380,584	Loan ID 200100	Fixed	5.000%	7/1/2037		347,249
	74,405	Loan ID 200102	Fixed	8.250%	3/1/2040		67,833
	185,410	Loan ID 200105	Fixed	3.000%	12/1/2050		82,614
	156,474	Loan ID 200106	Fixed	2.000%	2/1/2052		68,255
	442,886	Loan ID 200107	Fixed	2.000%	7/1/2052		216,056
	186,255	Loan ID 200108	Fixed	3.000%	6/1/2047		146,328
	113,456	Loan ID 200110	Fixed	8.250%	8/1/2039		115,352
	206,929	Loan ID 200111	Fixed	6.000%	11/1/2050		60,433
	305,250	Loan ID 200112	Fixed	3.000%	9/1/2049		93,509
	125,790	Loan ID 200114	Fixed	3.000%	10/1/2051		73,738
	407,184	Loan ID 200115	Fixed	2.000%	11/1/2051		133,872
	148,031	Loan ID 200116	Fixed	7.125%	3/1/2039		130,003
	405,886	Loan ID 200125	Fixed	2.000%	5/1/2051		206,177
	126,161	Loan ID 200126	Fixed	8.250%	8/1/2039		128,444
	141,983	Loan ID 200127	Fixed	5.000%	8/1/2039		46,875
	72,965	Loan ID 200128	Fixed	3.000%	7/1/2037		34,625
	461,304	Loan ID 200129	Fixed	4.625%	3/1/2052		353,853
	34,420	Loan ID 200131	Fixed	3.875%	11/1/2027		35,847
	229,514	Loan ID 200133	Fixed	3.490%	1/1/2043		235,478
	185,457	Loan ID 200134	Fixed	3.750%	12/1/2042		192,712
	124,256	Loan ID 200135	Fixed	4.375%	12/1/2042		130,469
	231,095	Loan ID 200136	Fixed	2.875%	10/1/2027		226,886
	127,523	Loan ID 200137	Fixed	4.500%	9/1/2042		133,899
	46,219	Loan ID 200139	Fixed	4.625%	5/1/2027		48,530
	79,694	Loan ID 200141	Fixed	4.250%	2/1/2042		83,679
	127,773	Loan ID 200143	Fixed	3.000%	2/1/2037		127,741
	391,425	Loan ID 200145	Fixed	2.000%	8/1/2051		252,578
	100,089	Loan ID 200152	ARM	3.750%	9/1/2037		89,976
	98,693	Loan ID 200154	Fixed	11.050%	9/1/2037		103,628
	54,116	Loan ID 200156	Fixed	8.130%	9/19/2032		45,952
	122,981	Loan ID 200157	Fixed	3.750%	1/1/2043		119,567

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

5 

Vertical Capital Income Fund

PORTFOLIO OF INVESTMENTS (Continued)

September 30, 2016

Principal				Loan Type	Interest Rate	Maturity	Value
		MORTGAGE NOTES (Continued) - 93.2 %
$	158,032	Loan ID 200158		Fixed	3.625%	12/1/2042	$	146,456
	183,360	Loan ID 200159		Fixed	3.750%	6/1/2042		190,277
	127,920	Loan ID 200160		Fixed	3.250%	2/1/2043		129,098
	470,129	Loan ID 200161		Fixed	3.875%	11/1/2041		490,891
	226,738	Loan ID 200162		Fixed	3.875%	7/1/2042		236,629
	120,169	Loan ID 200163		Fixed	4.000%	1/1/2042		125,794
	199,369	Loan ID 200165		Fixed	4.375%	12/1/2041		209,337
	118,538	Loan ID 200166		Fixed	4.000%	2/1/2032		123,922
	124,794	Loan ID 200168		Fixed	3.750%	10/1/2042		128,667
	24,282	Loan ID 200169		Fixed	6.923%	9/1/2034		25,497
	142,095	Loan ID 200172		Fixed	7.250%	2/1/2037		148,795
	91,918	Loan ID 200174		Fixed	7.340%	4/1/2037		96,514
	53,298	Loan ID 200175		Fixed	9.600%	5/1/2037		55,750
	55,325	Loan ID 200177		Fixed	8.000%	1/11/2022		58,091
	18,586	Loan ID 200179		Fixed	7.250%	7/27/2019		19,515
	112,483	Loan ID 200181		Fixed	7.500%	6/1/2041		118,107
	84,792	Loan ID 200182		Fixed	8.750%	10/10/2016		89,032
	74,760	Loan ID 200184		Fixed	4.375%	12/1/2042		69,929
	28,472	Loan ID 200185		Fixed	5.375%	6/1/2042		29,896
	54,291	Loan ID 200186		Fixed	5.125%	8/1/2042		57,005
	152,059	Loan ID 200188		Fixed	3.875%	2/1/2043		158,545
	170,535	Loan ID 200189		Fixed	4.125%	8/1/2042		179,061
	338,645	Loan ID 200190		Fixed	3.625%	11/1/2042		350,076
	131,689	Loan ID 200191		Fixed	4.125%	11/1/2042		138,274
	166,035	Loan ID 200194		Fixed	4.750%	9/1/2041		174,337
	269,388	Loan ID 200195		Fixed	3.875%	3/1/2042		281,101
	101,511	Loan ID 200196	��	Fixed	4.500%	1/1/2043		106,586
	39,541	Loan ID 200197		Fixed	4.750%	11/1/2042		41,518
	41,373	Loan ID 200198		Fixed	5.250%	10/1/2042		43,441
	291,418	Loan ID 200199		Fixed	4.000%	9/1/2042		304,423
	248,214	Loan ID 200200		Fixed	3.875%	9/1/2042		227,271
	56,086	Loan ID 200201		Fixed	5.125%	8/1/2041		58,890
	59,757	Loan ID 200202		Fixed	4.375%	12/1/2042		62,745
	24,287	Loan ID 200206		Fixed	3.990%	12/1/2042		25,246
	49,635	Loan ID 200208		Fixed	4.250%	1/1/2043		52,116
	209,788	Loan ID 200209		Fixed	3.875%	8/1/2042		218,984
	88,557	Loan ID 200210		Fixed	4.625%	5/1/2043		92,985
	136,218	Loan ID 200212		Fixed	3.875%	2/1/2042		124,645
	287,472	Loan ID 200213		Fixed	4.125%	1/1/2038		268,345
	56,943	Loan ID 200214		Fixed	5.750%	7/1/2039		59,790
	116,498	Loan ID 200216		Fixed	5.750%	9/1/2039		117,031
	146,441	Loan ID 200217		Fixed	5.250%	7/1/2040		153,763
	76,153	Loan ID 200218		Fixed	4.250%	12/1/2041		44,079
	201,954	Loan ID 200219		Fixed	4.250%	4/1/2043		212,052

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

6 

Vertical Capital Income Fund

PORTFOLIO OF INVESTMENTS (Continued)

September 30, 2016

Principal			Loan Type	Interest Rate	Maturity	Value
		MORTGAGE NOTES (Continued) - 93.2 %
$	217,212	Loan ID 200220	Fixed	3.875%	5/1/2043	$	200,208
	167,310	Loan ID 200221	Fixed	4.250%	4/1/2043		174,777
	211,383	Loan ID 200224	Fixed	4.000%	7/1/2043		201,211
	83,010	Loan ID 200226	Fixed	5.250%	7/1/2041		87,161
	51,652	Loan ID 200228	Fixed	4.625%	8/1/2042		54,234
	164,714	Loan ID 200229	Fixed	3.750%	7/1/2042		169,075
	148,297	Loan ID 200230	Fixed	3.500%	2/1/2043		150,259
	132,404	Loan ID 200231	Fixed	3.625%	12/1/2042		119,986
	69,662	Loan ID 200232	Fixed	3.875%	8/1/2042		72,703
	175,517	Loan ID 200233	Fixed	2.990%	11/1/2027		174,538
	94,590	Loan ID 200235	Fixed	3.750%	12/1/2042		98,134
	319,336	Loan ID 200238	ARM	3.625%	7/1/2035		166,474
	120,389	Loan ID 200243	Fixed	3.750%	4/1/2043		122,392
	28,470	Loan ID 200244	Fixed	5.000%	5/1/2042		29,893
	205,112	Loan ID 200245	Fixed	3.875%	3/1/2043		213,875
	92,878	Loan ID 200286	Fixed	4.500%	7/1/2043		97,522
	101,891	Loan ID 200287	Fixed	4.375%	7/1/2043		106,986
	342,351	Loan ID 200288	Fixed	4.375%	11/1/2041		359,469
	348,136	Loan ID 200289	Fixed	5.500%	9/1/2043		365,543
	294,143	Loan ID 200290	Fixed	4.250%	4/1/2043		308,850
	181,771	Loan ID 200294	Fixed	3.875%	2/1/2043		188,951
	259,262	Loan ID 200295	Fixed	3.875%	6/1/2043		269,726
	209,364	Loan ID 200296	Fixed	3.250%	2/1/2043		211,239
	181,414	Loan ID 200297	Fixed	3.375%	10/1/2042		184,594
	197,088	Loan ID 200299	Fixed	3.625%	10/1/2042		203,042
	119,288	Loan ID 200300	Fixed	8.400%	10/20/2037		125,253
	103,052	Loan ID 200302	Fixed	9.875%	10/1/2035		92,902
	72,230	Loan ID 200303	Fixed	5.250%	10/1/2032		45,252
	142,239	Loan ID 200304	Fixed	7.250%	10/1/2033		149,351
	250,929	Loan ID 200305	Fixed	7.000%	3/1/2036		211,594
	725,239	Loan ID 200306	Fixed	4.870%	5/1/2049		718,294
	48,698	Loan ID 200307	Fixed	6.500%	7/1/2031		48,698
	111,246	Loan ID 200308	ARM	6.750%	5/1/2035		38,256
	210,821	Loan ID 200309	Fixed	2.000%	12/1/2048		185,588
	133,642	Loan ID 200312	Fixed	9.000%	4/1/2039		121,674
	46,987	Loan ID 200313	Fixed	8.500%	3/1/2028		34,080
	63,304	Loan ID 200314	Fixed	8.000%	3/1/2040		36,515
	311,377	Loan ID 200315	ARM	3.750%	6/1/2037		145,763
	74,726	Loan ID 200317	Fixed	7.000%	9/1/2032		78,462
	295,845	Loan ID 200318	Fixed	6.500%	10/1/2036		301,484
	548,976	Loan ID 200324	Fixed	5.500%	11/1/2037		239,733
	555,352	Loan ID 200325	Fixed	6.000%	5/1/2042		217,674
	77,680	Loan ID 200326	Fixed	8.375%	10/1/2036		81,564
	150,749	Loan ID 200327	Fixed	6.790%	10/26/2036		158,286

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

7 

Vertical Capital Income Fund

PORTFOLIO OF INVESTMENTS (Continued)

September 30, 2016

Principal			Loan Type	Interest Rate	Maturity	Value
		MORTGAGE NOTES (Continued) - 93.2 %
$	254,591	Loan ID 200330	Fixed	7.000%	8/1/2037	$	264,986
	102,866	Loan ID 200332	Fixed	5.775%	10/1/2037		108,009
	91,324	Loan ID 200334	Fixed	7.000%	1/1/2033		95,890
	272,762	Loan ID 200335	Fixed	2.000%	11/1/2052		206,466
	119,538	Loan ID 200336	Fixed	7.000%	12/1/2042		37,174
	45,405	Loan ID 200337	Fixed	7.000%	10/1/2034		47,675
	53,257	Loan ID 200338	ARM	10.500%	8/1/2029		55,920
	162,490	Loan ID 200339	Fixed	2.000%	10/1/2033		157,637
	34,625	Loan ID 200340	Fixed	7.000%	3/1/2030		36,356
	292,715	Loan ID 200341	Fixed	7.000%	8/1/2035		206,277
	63,342	Loan ID 200348	Fixed	6.500%	7/1/2038		65,011
	239,681	Loan ID 200349	Fixed	7.000%	1/1/2037		158,340
	58,380	Loan ID 200350	Fixed	7.500%	3/1/2029		61,299
	73,054	Loan ID 200352	Fixed	7.000%	8/1/2030		53,961
	43,094	Loan ID 200355	ARM	8.500%	7/1/2032		40,241
	133,863	Loan ID 200358	Fixed	3.000%	4/1/2025		106,099
	29,364	Loan ID 200360	ARM	3.000%	1/1/2025		28,504
	71,703	Loan ID 200361	Fixed	7.500%	1/1/2034		75,289
	110,763	Loan ID 200362	Fixed	5.000%	6/1/2045		62,575
	147,324	Loan ID 200363	Fixed	6.000%	3/1/2049		110,233
	67,426	Loan ID 200366	Fixed	6.250%	1/1/2033		67,426
	180,573	Loan ID 200368	Fixed	4.500%	4/1/2036		189,601
	264,934	Loan ID 200369	Fixed	6.000%	4/1/2044		278,180
	61,179	Loan ID 200373	Fixed	7.000%	12/1/2036		53,464
	75,703	Loan ID 200374	ARM	7.000%	5/1/2034		75,703
	429,105	Loan ID 200376	Fixed	2.900%	6/1/2053		336,222
	80,755	Loan ID 200377	ARM	3.500%	10/1/2036		29,207
	231,751	Loan ID 200378	Fixed	5.500%	5/1/2045		216,312
	185,709	Loan ID 200380	Fixed	4.220%	4/1/2049		163,599
	290,725	Loan ID 200381	Fixed	4.780%	6/1/2037		258,806
	392,204	Loan ID 200383	Fixed	5.030%	12/1/2046		390,936
	296,844	Loan ID 200384	Fixed	5.000%	11/1/2047		257,775
	146,523	Loan ID 200385	Fixed	8.250%	1/1/2040		153,850
	223,156	Loan ID 200386	Fixed	6.000%	3/1/2041		164,154
	75,300	Loan ID 200387	Fixed	4.000%	6/1/2039		64,728
	194,944	Loan ID 200388	Fixed	4.000%	3/1/2051		95,273
	121,781	Loan ID 200389	Fixed	4.820%	8/1/2047		109,908
	201,907	Loan ID 200390	Fixed	4.780%	4/16/2047		181,991
	176,265	Loan ID 200391	Fixed	4.000%	1/13/2035		168,039
	67,526	Loan ID 200392	Fixed	10.000%	6/5/2034		65,261
	105,026	Loan ID 200393	Fixed	5.070%	8/1/2037		89,908
	129,525	Loan ID 200394	Fixed	7.150%	8/1/2037		135,212
	78,880	Loan ID 200395	Fixed	4.860%	4/1/2047		70,329
	73,345	Loan ID 200396	Fixed	10.000%	2/1/2036		77,012

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

8 

Vertical Capital Income Fund

PORTFOLIO OF INVESTMENTS (Continued)

September 30, 2016

Principal			Loan Type	Interest Rate	Maturity	Value
		MORTGAGE NOTES (Continued) - 93.2 %
$	115,112	Loan ID 200397	ARM	9.375%	9/1/2037	$	120,868
	136,984	Loan ID 200398	Fixed	4.800%	2/1/2037		122,106
	79,193	Loan ID 200399	Fixed	4.980%	6/1/2037		62,298
	52,682	Loan ID 200403	Fixed	8.300%	10/15/2032		55,316
	57,715	Loan ID 200404	Fixed	8.100%	5/1/2037		60,601
	99,222	Loan ID 200405	Fixed	4.870%	12/1/2035		95,465
	117,087	Loan ID 200406	Fixed	4.875%	10/1/2051		116,080
	235,441	Loan ID 200407	Fixed	6.500%	4/1/2042		245,606
	202,871	Loan ID 200408	Fixed	6.000%	4/1/2039		169,761
	346,714	Loan ID 200409	Fixed	6.000%	2/1/2049		279,865
	106,470	Loan ID 200411	Fixed	8.275%	6/1/2037		111,794
	311,225	Loan ID 200412	Fixed	5.500%	6/1/2045		194,829
	183,512	Loan ID 200416	Fixed	4.670%	8/1/2053		135,978
	71,377	Loan ID 200417	Fixed	7.000%	5/1/2035		74,945
	56,763	Loan ID 200418	Fixed	4.000%	6/1/2035		53,573
	166,277	Loan ID 200419	Fixed	4.000%	12/19/2035		168,651
	168,020	Loan ID 200420	Fixed	4.225%	4/10/2038		158,604
	76,859	Loan ID 200421	Fixed	7.710%	8/1/2037		77,100
	136,719	Loan ID 200422	Fixed	3.830%	8/1/2053		100,571
	130,816	Loan ID 200423	Fixed	4.500%	6/1/2043		122,104
	113,539	Loan ID 200424	Fixed	4.000%	9/1/2028		118,641
	252,980	Loan ID 200427	Fixed	3.625%	3/1/2043		261,188
	227,131	Loan ID 200430	Fixed	3.625%	7/1/2043		233,820
	190,108	Loan ID 200431	Fixed	4.625%	7/1/2043		199,614
	308,629	Loan ID 200432	Fixed	4.875%	5/1/2043		324,061
	130,025	Loan ID 200433	Fixed	4.250%	8/1/2043		136,526
	161,282	Loan ID 200434	Fixed	5.250%	10/1/2043		169,346
	199,939	Loan ID 200435	Fixed	4.625%	11/1/2052		196,711
	215,015	Loan ID 200436	Fixed	3.750%	4/1/2043		222,440
	332,446	Loan ID 200437	Fixed	5.625%	10/1/2043		349,069
	44,675	Loan ID 200439	Fixed	5.000%	8/1/2041		44,675
	195,216	Loan ID 200441	Fixed	6.000%	4/1/2045		161,943
	443,090	Loan ID 200442	Fixed	5.000%	12/1/2043		248,893
	273,414	Loan ID 200443	Fixed	3.000%	7/1/2049		213,621
	259,036	Loan ID 200444	Fixed	4.380%	11/1/2038		195,016
	162,980	Loan ID 200445	Fixed	5.250%	2/1/2039		171,129
	52,655	Loan ID 200447	Fixed	5.875%	11/4/2034		55,288
	79,125	Loan ID 200448	Interest Only	5.750%	5/1/2042		54,028
	126,833	Loan ID 200449	Fixed	5.000%	7/1/2041		133,174
	362,911	Loan ID 200451	Fixed	6.250%	7/1/2038		381,056
	134,495	Loan ID 200452	Fixed	3.000%	11/1/2041		101,690
	16,303	Loan ID 200453	ARM	6.250%	3/1/2026		17,118
	241,893	Loan ID 200456	Fixed	2.000%	11/1/2038		223,963
	210,252	Loan ID 200457	Fixed	5.750%	12/10/2030		220,764

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

9 

Vertical Capital Income Fund

PORTFOLIO OF INVESTMENTS (Continued)

September 30, 2016

Principal			Loan Type	Interest Rate	Maturity	Value
		MORTGAGE NOTES (Continued) - 93.2 %
$	190,148	Loan ID 200460	Fixed	7.000%	7/1/2041	$	199,656
	385,770	Loan ID 200462	Fixed	6.000%	7/1/2045		322,210
	157,764	Loan ID 200463	Fixed	6.000%	3/1/2037		37,636
	411,571	Loan ID 200464	ARM	8.750%	8/1/2037		154,637
	246,912	Loan ID 200465	Fixed	6.500%	7/1/2037		239,242
	449,658	Loan ID 200466	Fixed	7.000%	7/1/2037		442,798
	359,059	Loan ID 200467	Fixed	5.500%	9/1/2044		314,007
	105,113	Loan ID 200468	Fixed	5.625%	12/1/2044		85,874
	130,014	Loan ID 200469	Fixed	6.500%	7/1/2037		111,118
	293,233	Loan ID 200473	Fixed	4.000%	12/1/2042		250,604
	243,244	Loan ID 200474	Fixed	5.750%	11/1/2050		255,406
	169,436	Loan ID 200475	Fixed	5.450%	7/1/2049		177,908
	192,427	Loan ID 200476	Fixed	6.000%	9/1/2050		198,184
	214,884	Loan ID 200477	Fixed	4.125%	12/1/2028		224,580
	113,209	Loan ID 200482	Fixed	4.375%	11/1/2028		118,870
	106,348	Loan ID 200483	Fixed	4.375%	11/1/2028		111,665
	75,488	Loan ID 200485	Fixed	4.125%	2/1/2043		79,262
	251,317	Loan ID 200486	Fixed	3.500%	1/1/2043		257,497
	470,674	Loan ID 200487	Fixed	6.000%	3/1/2037		203,725
	160,331	Loan ID 200488	Fixed	4.250%	1/1/2044		153,876
	115,572	Loan ID 200489	Fixed	4.000%	3/1/2043		109,299
	80,611	Loan ID 200490	Fixed	4.000%	11/1/2028		84,308
	206,743	Loan ID 200491	Fixed	5.500%	10/1/2039		206,743
	122,250	Loan ID 200492	Fixed	4.000%	1/1/2043		127,875
	66,026	Loan ID 200493	Fixed	4.500%	12/1/2025		69,327
	278,897	Loan ID 200494	Fixed	4.625%	10/1/2043		292,842
	202,744	Loan ID 200496	Fixed	3.875%	2/1/2043		210,952
	325,599	Loan ID 200497	Fixed	3.250%	4/1/2043		329,073
	273,313	Loan ID 200499	Fixed	4.250%	1/1/2043		286,859
	220,627	Loan ID 200500	Fixed	5.875%	2/1/2037		226,087
	151,897	Loan ID 200501	Fixed	7.250%	12/1/2037		159,492
	191,591	Loan ID 200502	Fixed	5.000%	5/1/2052		116,834
	386,640	Loan ID 200504	Fixed	3.375%	3/1/2043		392,732
	74,765	Loan ID 200507	Fixed	4.500%	9/1/2042		78,504
	248,238	Loan ID 200508	Fixed	2.000%	10/1/2040		199,462
	305,490	Loan ID 200509	Fixed	2.000%	12/1/2052		120,356
	335,105	Loan ID 200514	Fixed	3.000%	4/1/2047		334,958
	100,238	Loan ID 200515	Fixed	8.250%	2/1/2039		105,250
	392,642	Loan ID 200516	Fixed	5.250%	2/1/2046		142,289
	104,345	Loan ID 200517	Fixed	8.000%	5/1/2039		105,480
	204,217	Loan ID 200518	Fixed	3.000%	12/1/2050		181,169
	316,291	Loan ID 200519	Fixed	3.000%	11/1/2049		312,494
	67,952	Loan ID 200520	Fixed	3.260%	7/1/2053		46,899
	120,605	Loan ID 200524	Fixed	3.500%	6/1/2043		123,811

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

10 

Vertical Capital Income Fund

PORTFOLIO OF INVESTMENTS (Continued)

September 30, 2016

Principal			Loan Type	Interest Rate	Maturity	Value
		MORTGAGE NOTES (Continued) - 93.2 %
$	286,381	Loan ID 200525	Fixed	3.250%	12/1/2042	$	284,041
	112,139	Loan ID 200527	Fixed	4.500%	12/1/2043		117,746
	137,646	Loan ID 200528	Fixed	4.375%	2/1/2044		144,529
	398,614	Loan ID 200529	Fixed	4.625%	2/1/2044		418,544
	32,647	Loan ID 200530	Fixed	5.375%	2/1/2044		34,280
	175,413	Loan ID 200531	Fixed	4.625%	11/1/2043		184,184
	112,794	Loan ID 200532	Fixed	3.250%	7/1/2043		111,974
	59,057	Loan ID 200536	Fixed	3.750%	10/1/2042		41,589
	122,691	Loan ID 200537	Fixed	4.500%	3/1/2042		117,486
	93,238	Loan ID 200538	Fixed	4.750%	1/1/2043		97,900
	84,826	Loan ID 200540	Fixed	3.875%	2/1/2043		88,428
	57,601	Loan ID 200543	ARM	7.250%	2/1/2037		6,994
	57,806	Loan ID 200545	Fixed	4.375%	2/1/2029		60,696
	122,432	Loan ID 200546	Fixed	5.375%	12/1/2043		128,554
	170,011	Loan ID 200548	Fixed	5.250%	2/1/2044		178,511
	135,367	Loan ID 200550	Fixed	3.750%	3/1/2043		140,133
	221,157	Loan ID 200555	Fixed	4.375%	1/1/2044		232,214
	119,491	Loan ID 200560	Fixed	5.750%	5/1/2035		125,466
	226,155	Loan ID 200561	Fixed	6.375%	12/1/2036		218,438
	139,675	Loan ID 200564	Fixed	4.875%	5/1/2039		137,388
	533,865	Loan ID 200565	Interest Only	4.000%	6/1/2037		472,685
	378,729	Loan ID 200566	Fixed	6.500%	7/1/2047		187,986
	133,066	Loan ID 200567	Fixed	3.375%	5/1/2043		135,466
	99,856	Loan ID 200569	Fixed	5.125%	2/1/2044		104,848
	430,147	Loan ID 200570	Fixed	3.625%	6/1/2043		443,537
	137,204	Loan ID 200571	Fixed	4.500%	7/1/2043		144,064
	166,554	Loan ID 200572	Fixed	4.375%	3/1/2044		174,882
	96,726	Loan ID 200573	Fixed	3.750%	9/1/2042		99,920
	131,064	Loan ID 200574	Fixed	4.875%	1/1/2044		137,617
	179,238	Loan ID 200577	Fixed	3.125%	4/1/2028		179,879
	184,896	Loan ID 200578	Fixed	4.750%	8/1/2040		194,141
	48,954	Loan ID 200579	Fixed	4.875%	5/1/2042		50,997
	176,661	Loan ID 200580	Fixed	4.125%	11/1/2041		169,417
	38,919	Loan ID 200581	Fixed	4.750%	9/1/2042		40,280
	375,223	Loan ID 200582	Fixed	4.000%	11/1/2042		347,942
	87,018	Loan ID 200583	Fixed	3.625%	9/1/2027		89,788
	351,090	Loan ID 200584	Fixed	3.375%	4/1/2043		309,102
	171,378	Loan ID 200585	Fixed	4.000%	6/1/2046		158,040
	329,737	Loan ID 200586	Fixed	3.500%	1/1/2043		338,229
	253,707	Loan ID 200588	Fixed	3.750%	5/1/2042		263,653
	61,058	Loan ID 200590	Fixed	4.125%	7/1/2042		54,387
	102,618	Loan ID 200591	Fixed	4.875%	3/1/2043		107,749
	98,997	Loan ID 200592	Fixed	4.375%	6/1/2042		103,946
	67,647	Loan ID 200593	Fixed	3.875%	6/1/2042		70,279

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

11 

Vertical Capital Income Fund

PORTFOLIO OF INVESTMENTS (Continued)

September 30, 2016

Principal				Loan Type	Interest Rate	Maturity	Value
			MORTGAGE NOTES (Continued) - 93.2 %
$	228,939		Loan ID 200594	Fixed	4.250%	4/1/2043	$	239,132
	39,668		Loan ID 200597	Fixed	5.625%	2/1/2044		41,651
	136,472		Loan ID 200598	Fixed	4.625%	2/1/2044		143,296
	121,060		Loan ID 200599	Fixed	4.125%	2/1/2043		126,930
	199,069		Loan ID 200600	Fixed	4.625%	4/1/2044		209,023
	109,609		Loan ID 200601	Fixed	4.000%	3/1/2043		114,772
	185,840		Loan ID 200602	Fixed	3.750%	3/1/2043		192,874
	71,213		Loan ID 200603	Fixed	4.125%	6/1/2043		74,377
	73,983		Loan ID 200604	Fixed	3.500%	1/1/2043		75,853
	141,501		Loan ID 200605	Fixed	4.875%	11/1/2043		136,637
	129,080		Loan ID 200606	Fixed	3.625%	12/1/2042		133,412
	219,314	��	Loan ID 200607	Fixed	2.875%	11/1/2027		216,983
	136,634		Loan ID 200608	Fixed	4.125%	11/1/2043		130,903
	57,183		Loan ID 200611	Fixed	4.625%	5/1/2043		60,042
	126,722		Loan ID 200612	Fixed	4.500%	2/1/2043		133,022
	206,552		Loan ID 200613	Fixed	3.369%	1/1/2043		210,565
	104,166		Loan ID 200614	Fixed	5.000%	1/1/2044		109,375
	102,602		Loan ID 200615	Fixed	4.250%	8/1/2043		107,732
	341,009		Loan ID 200616	Fixed	4.875%	2/1/2044		358,060
	93,334		Loan ID 200617	Fixed	4.750%	9/1/2043		50,312
	129,806		Loan ID 200618	Fixed	4.375%	5/1/2042		136,296
	230,741		Loan ID 200620	Fixed	4.250%	10/1/2043		217,153
	133,090		Loan ID 200621	Fixed	3.625%	1/1/2043		136,424
	74,004		Loan ID 200623	Fixed	4.375%	12/1/2042		77,705
	256,095		Loan ID 200624	Fixed	4.125%	4/1/2043		268,703
	117,444		Loan ID 200626	Fixed	4.500%	10/1/2043		111,374
	132,458		Loan ID 200627	Fixed	4.250%	10/1/2043		139,080
	76,268		Loan ID 200628	Fixed	3.250%	2/1/2028		77,059
	155,212		Loan ID 200629	Fixed	4.375%	9/1/2043		149,640
	166,595		Loan ID 200630	Fixed	5.250%	9/1/2043		174,925
	293,005		Loan ID 200631	Fixed	3.250%	6/1/2043		296,949
	345,410		Loan ID 200632	Fixed	5.250%	5/1/2044		362,681
	225,847		Loan ID 200633	Fixed	5.125%	5/1/2044		237,140
	233,147		Loan ID 200634	Fixed	4.375%	1/1/2044		244,804
	105,490		Loan ID 200635	Fixed	3.750%	5/1/2029		108,053
	196,174		Loan ID 200636	Fixed	3.750%	2/1/2053		205,983
	188,740		Loan ID 200638	Fixed	3.875%	3/1/2043		158,397
	170,260		Loan ID 200641	Fixed	5.250%	4/1/2044		178,773
	146,130		Loan ID 200642	Fixed	5.000%	3/1/2044		134,763
	169,345		Loan ID 200644	Fixed	4.750%	3/1/2044		177,812
	118,419		Loan ID 200645	Fixed	5.000%	4/1/2044		124,340
	118,578		Loan ID 200647	Fixed	4.250%	1/1/2044		124,507
	154,561		Loan ID 200648	Fixed	4.750%	3/1/2044		162,289
	143,172		Loan ID 200649	Fixed	4.375%	3/1/2044		148,614

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

12 

Vertical Capital Income Fund

PORTFOLIO OF INVESTMENTS (Continued)

September 30, 2016

Principal			Loan Type	Interest Rate	Maturity	Value
		MORTGAGE NOTES (Continued) - 93.2 %
$	130,180	Loan ID 200650	Fixed	4.875%	5/1/2044	$	125,652
	263,025	Loan ID 200651	Fixed	3.625%	7/1/2043		270,699
	170,911	Loan ID 200652	Fixed	4.125%	5/1/2038		119,066
	353,255	Loan ID 200653	Fixed	4.000%	4/1/2053		365,882
	279,649	Loan ID 200654	Fixed	5.125%	2/1/2041		156,077
	141,247	Loan ID 200655	Fixed	3.375%	5/1/2043		143,403
	153,774	Loan ID 200656	Fixed	6.875%	7/1/2037		72,339
	145,984	Loan ID 200657	Fixed	4.875%	8/1/2051		153,283
	285,784	Loan ID 200659	Fixed	4.000%	3/1/2053		219,418
	183,323	Loan ID 200660	Fixed	5.875%	3/1/2038		192,489
	212,768	Loan ID 200662	Fixed	5.000%	3/1/2044		223,406
	69,283	Loan ID 200663	Fixed	4.750%	5/1/2044		72,747
	276,915	Loan ID 200664	Fixed	4.750%	4/1/2044		290,760
	271,522	Loan ID 200665	Fixed	5.299%	12/1/2046		142,518
	217,454	Loan ID 200666	Fixed	5.890%	8/26/2035		152,888
	303,996	Loan ID 200668	Fixed	3.625%	4/1/2043		314,262
	156,135	Loan ID 200669	Fixed	5.250%	4/1/2044		163,942
	64,274	Loan ID 200670	Fixed	4.375%	2/1/2029		66,859
	238,699	Loan ID 200671	Fixed	4.625%	8/1/2043		249,292
	158,837	Loan ID 200672	Fixed	3.750%	7/1/2043		161,753
	310,932	Loan ID 200674	Fixed	4.500%	5/1/2044		301,123
	283,982	Loan ID 200675	Fixed	5.125%	4/1/2044		298,181
	123,753	Loan ID 200677	Fixed	3.625%	5/1/2028		127,587
	468,670	Loan ID 200678	Fixed	4.375%	2/1/2044		492,104
	255,988	Loan ID 200679	Fixed	5.000%	4/1/2044		205,583
	191,034	Loan ID 200682	Fixed	4.875%	5/1/2044		173,619
	214,261	Loan ID 200683	Fixed	4.500%	4/1/2044		224,975
	127,015	Loan ID 200684	Fixed	4.875%	4/1/2044		133,365
	231,268	Loan ID 200685	Fixed	4.875%	5/1/2044		242,831
	184,491	Loan ID 200688	Fixed	4.250%	3/1/2053		116,974
	135,305	Loan ID 200689	Fixed	4.375%	12/1/2043		126,543
	226,662	Loan ID 200690	Fixed	4.250%	4/1/2044		236,455
	288,628	Loan ID 200691	Fixed	4.500%	5/1/2044		303,059
	245,442	Loan ID 200692	Fixed	4.625%	7/1/2044		257,714
	107,631	Loan ID 200694	Fixed	4.500%	9/1/2043		113,013
	48,869	Loan ID 200696	Fixed	3.750%	10/1/2042		50,790
	136,614	Loan ID 200697	Fixed	4.500%	1/1/2044		129,759
	189,088	Loan ID 200699	Fixed	4.125%	7/1/2044		196,726
	94,476	Loan ID 200700	Fixed	4.250%	2/1/2044		98,933
	168,618	Loan ID 200701	Fixed	4.750%	6/1/2044		177,049
	97,641	Loan ID 200704	Fixed	4.375%	3/1/2043		102,476
	134,353	Loan ID 200705	Fixed	4.625%	4/1/2044		141,070
	103,587	Loan ID 200706	Fixed	4.990%	6/1/2044		108,767
	100,720	Loan ID 200707	Fixed	4.875%	2/1/2044		105,756

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

13 

Vertical Capital Income Fund

PORTFOLIO OF INVESTMENTS (Continued)

September 30, 2016

Principal			Loan Type	Interest Rate	Maturity	Value
		MORTGAGE NOTES (Continued) - 93.2 %
$	133,716	Loan ID 200708	Fixed	4.875%	2/1/2044	$	140,402
	51,489	Loan ID 200709	Fixed	4.375%	4/1/2043		54,064
	116,807	Loan ID 200710	Fixed	4.500%	7/1/2044		103,002
	116,802	Loan ID 200711	Fixed	3.750%	7/1/2043		118,849
	217,476	Loan ID 200712	Fixed	3.875%	2/1/2044		200,225
	98,131	Loan ID 200713	Fixed	4.250%	12/1/2043		102,526
	605,673	Loan ID 200714	Fixed	4.175%	11/1/2036		532,498
	211,169	Loan ID 200716	ARM	3.507%	8/1/2037		136,498
	143,465	Loan ID 200720	ARM	3.500%	4/1/2042		102,076
	186,281	Loan ID 200721	Fixed	3.000%	8/1/2037		146,239
	191,871	Loan ID 200725	Fixed	7.000%	7/1/2037		95,766
	149,993	Loan ID 200726	Fixed	4.125%	9/1/2037		98,967
	172,927	Loan ID 200727	Fixed	2.625%	7/1/2037		166,044
	340,902	Loan ID 200729	ARM	3.625%	11/1/2037		186,621
	446,642	Loan ID 200730	ARM	3.125%	9/1/2036		282,922
	199,990	Loan ID 200732	Fixed	4.125%	9/1/2027		178,928
	233,025	Loan ID 200733	Fixed	3.750%	12/1/2042		241,973
	245,029	Loan ID 200734	ARM	3.375%	4/1/2044		254,559
	102,846	Loan ID 200735	Fixed	4.500%	6/1/2044		107,988
	145,589	Loan ID 200736	Fixed	4.750%	5/1/2044		131,664
	143,573	Loan ID 200737	Fixed	4.750%	5/1/2044		100,516
	592,951	Loan ID 200738	Fixed	4.125%	6/1/2044		622,411
	355,714	Loan ID 200739	Fixed	4.625%	8/1/2044		343,488
	132,641	Loan ID 200740	Fixed	4.875%	6/1/2044		139,273
	179,073	Loan ID 200742	Fixed	4.250%	4/1/2043		179,037
	193,944	Loan ID 200744	Fixed	3.625%	6/1/2043		199,952
	124,119	Loan ID 200745	Fixed	3.250%	6/1/2043		123,897
	335,586	Loan ID 200747	Fixed	4.125%	5/1/2043		351,677
	454,857	Loan ID 200748	Fixed	4.750%	12/1/2043		477,599
	155,202	Loan ID 200749	Fixed	4.750%	9/1/2043		162,962
	245,562	Loan ID 200750	Fixed	4.750%	5/1/2044		257,840
	171,903	Loan ID 200752	Fixed	4.750%	10/1/2043		66,996
	60,406	Loan ID 200753	Fixed	5.250%	5/1/2044		59,187
	226,216	Loan ID 200754	Fixed	4.750%	8/1/2044		237,527
	56,340	Loan ID 200755	Fixed	4.250%	6/1/2043		58,618
	192,129	Loan ID 200756	Fixed	4.875%	11/1/2043		175,319
	128,266	Loan ID 200759	Fixed	3.750%	6/1/2043		131,560
	174,945	Loan ID 200760	Fixed	3.750%	6/1/2043		181,328
	304,669	Loan ID 200762	Fixed	3.875%	5/1/2042		317,671
	155,512	Loan ID 200763	Fixed	4.250%	11/1/2043		148,831
	206,870	Loan ID 200765	Fixed	4.875%	11/1/2043		216,000
	499,913	Loan ID 200766	Fixed	3.625%	12/1/2042		516,694
	138,743	Loan ID 200770	Fixed	4.000%	5/1/2043		109,666
	176,662	Loan ID 200771	Fixed	4.500%	4/1/2043		170,149

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

14 

Vertical Capital Income Fund

PORTFOLIO OF INVESTMENTS (Continued)

September 30, 2016

Principal			Loan Type	Interest Rate	Maturity	Value
		MORTGAGE NOTES (Continued) - 93.2 %
$	250,072	Loan ID 200772	Fixed	3.750%	3/1/2043	$	259,868
	58,638	Loan ID 200773	Fixed	3.750%	10/1/2043		47,360
	208,176	Loan ID 200774	Fixed	3.875%	7/1/2043		216,838
	45,087	Loan ID 200775	Fixed	4.250%	4/1/2043		47,342
	82,358	Loan ID 200776	Fixed	4.250%	3/1/2044		86,010
	54,123	Loan ID 200777	Fixed	4.750%	6/1/2044		50,795
	144,398	Loan ID 200779	Fixed	4.625%	8/1/2044		151,618
	169,347	Loan ID 200781	Fixed	4.625%	9/1/2044		177,195
	141,690	Loan ID 200783	Fixed	4.750%	9/1/2044		139,179
	115,782	Loan ID 200785	Fixed	4.500%	8/1/2044		121,571
	229,451	Loan ID 200786	Fixed	4.625%	7/1/2044		222,069
	43,595	Loan ID 200787	Fixed	4.750%	9/1/2044		45,298
	192,235	Loan ID 200788	Fixed	3.625%	12/1/2028		196,545
	131,728	Loan ID 200789	Fixed	3.750%	9/1/2044		122,696
	152,947	Loan ID 200790	Fixed	4.250%	8/1/2044		160,594
	205,253	Loan ID 200791	Fixed	4.875%	6/1/2044		215,515
	365,060	Loan ID 200792	Fixed	3.375%	1/1/2043		237,813
	370,347	Loan ID 200793	Fixed	2.000%	10/1/2051		152,293
	234,344	Loan ID 200794	Fixed	3.000%	4/1/2050		56,481
	94,760	Loan ID 200795	Fixed	6.750%	8/1/2036		91,121
	71,993	Loan ID 200796	Fixed	2.170%	12/1/2053		46,695
	419,521	Loan ID 200797	Fixed	4.000%	6/1/2052		365,269
	59,706	Loan ID 200799	Fixed	4.000%	2/5/2053		59,085
	61,199	Loan ID 200800	Fixed	4.000%	1/1/2053		33,311
	215,485	Loan ID 200802	Fixed	7.000%	1/1/2042		69,716
	360,995	Loan ID 200803	Fixed	2.250%	11/1/2050		143,237
	155,198	Loan ID 200805	Fixed	4.000%	7/1/2050		112,720
	158,720	Loan ID 200806	Fixed	5.000%	8/1/2049		90,954
	296,269	Loan ID 200807	Fixed	3.460%	7/1/2047		219,896
	58,500	Loan ID 200808	Fixed	3.000%	11/1/2050		21,936
	116,908	Loan ID 200809	Fixed	4.000%	4/1/2050		49,719
	139,127	Loan ID 200810	Fixed	4.000%	1/1/2050		81,863
	111,160	Loan ID 200811	Fixed	4.000%	4/1/2050		76,375
	272,825	Loan ID 200813	Fixed	2.000%	12/1/2049		118,785
	242,361	Loan ID 200814	Fixed	8.250%	7/1/2039		254,479
	314,241	Loan ID 200815	Fixed	2.000%	3/1/2053		154,802
	282,365	Loan ID 200817	Fixed	4.000%	1/1/2050		185,594
	54,490	Loan ID 200818	Fixed	3.490%	8/1/2051		45,315
	264,687	Loan ID 200819	Fixed	2.000%	9/1/2053		116,784
	135,322	Loan ID 200820	Fixed	4.000%	7/1/2044		139,961
	211,074	Loan ID 200821	Fixed	4.250%	8/1/2044		221,627
	320,302	Loan ID 200822	Fixed	4.750%	1/1/2042		336,317
	82,356	Loan ID 200823	Fixed	4.250%	9/1/2044		85,698
	223,742	Loan ID 200824	Fixed	4.250%	8/1/2044		208,871

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

15 

Vertical Capital Income Fund

PORTFOLIO OF INVESTMENTS (Continued)

September 30, 2016

Principal			Loan Type	Interest Rate	Maturity	Value
		MORTGAGE NOTES (Continued) - 93.2 %
$	107,268	Loan ID 200826	Fixed	4.375%	9/1/2044	$	112,186
	188,088	Loan ID 200827	Fixed	3.875%	6/1/2044		191,652
	236,979	Loan ID 200828	Fixed	4.375%	7/1/2044		222,292
	250,138	Loan ID 200829	Fixed	4.375%	7/1/2043		262,645
	211,819	Loan ID 200830	ARM	2.875%	7/1/2044		193,570
	80,384	Loan ID 200831	Fixed	4.250%	10/1/2044		83,629
	344,500	Loan ID 200832	Fixed	4.250%	10/1/2044		327,890
	360,377	Loan ID 200833	Fixed	4.250%	1/1/2043		378,396
	162,180	Loan ID 200834	Fixed	4.125%	7/1/2043		170,173
	330,977	Loan ID 200835	Fixed	5.000%	8/1/2043		347,526
	332,454	Loan ID 200837	Fixed	4.625%	8/1/2044		349,076
	185,092	Loan ID 200838	Fixed	3.750%	8/1/2044		170,108
	237,191	Loan ID 200839	Fixed	5.000%	5/1/2044		249,051
	183,322	Loan ID 200842	Fixed	4.250%	8/1/2044		189,124
	362,090	Loan ID 200843	Fixed	4.750%	10/1/2043		380,195
	306,613	Loan ID 200844	Fixed	4.500%	7/1/2043		321,944
	206,057	Loan ID 200846	Fixed	4.375%	11/1/2043		196,743
	183,789	Loan ID 200847	Fixed	4.750%	10/1/2044		192,978
	178,998	Loan ID 200848	Fixed	2.000%	6/1/2051		130,200
	146,203	Loan ID 200850	Fixed	3.000%	6/1/2051		59,936
	619,116	Loan ID 200852	Fixed	2.868%	2/1/2053		521,836
	113,245	Loan ID 200853	Fixed	4.818%	4/1/2037		83,608
	105,590	Loan ID 200854	Fixed	2.500%	4/1/2053		95,383
	225,349	Loan ID 200855	ARM	3.839%	7/1/2037		174,419
	213,579	Loan ID 200856	Fixed	6.000%	6/1/2042		98,001
	244,616	Loan ID 200857	Fixed	2.125%	7/1/2040		107,845
	268,284	Loan ID 200858	Fixed	2.000%	1/1/2053		213,250
	245,032	Loan ID 200859	Fixed	2.170%	12/1/2052		107,837
	169,265	Loan ID 200860	Fixed	2.000%	3/1/2052		69,803
	431,255	Loan ID 200861	Fixed	2.000%	6/1/2054		362,685
	156,654	Loan ID 200862	Fixed	2.748%	8/1/2050		88,925
	253,206	Loan ID 200863	Fixed	2.000%	7/1/2052		207,902
	266,138	Loan ID 200864	Fixed	3.000%	1/1/2037		172,231
	210,887	Loan ID 200865	Fixed	3.060%	11/1/2053		164,093
	268,854	Loan ID 200866	Fixed	2.000%	5/1/2053		242,922
	114,782	Loan ID 200867	Fixed	2.370%	9/1/2053		82,320
	389,632	Loan ID 200872	Fixed	3.200%	8/1/2050		314,700
	201,081	Loan ID 200873	Fixed	3.525%	11/1/2053		139,719
	215,412	Loan ID 200874	Fixed	2.000%	11/1/2047		87,806
	572,329	Loan ID 200875	Fixed	2.000%	5/1/2054		441,898
	201,430	Loan ID 200876	ARM	3.125%	5/1/2035		184,822
	394,307	Loan ID 200877	Fixed	4.750%	9/1/2042		348,903
	136,878	Loan ID 200878	Fixed	4.000%	7/1/2050		105,761
	193,731	Loan ID 200880	Fixed	4.250%	6/1/2043		193,731

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

16 

Vertical Capital Income Fund

PORTFOLIO OF INVESTMENTS (Continued)

September 30, 2016

Principal			Loan Type	Interest Rate	Maturity	Value
		MORTGAGE NOTES (Continued) - 93.2 %
$	177,487	Loan ID 200882	Fixed	5.125%	9/1/2043	$	186,361
	86,022	Loan ID 200883	Fixed	3.375%	5/1/2028		87,343
	175,054	Loan ID 200885	Fixed	4.875%	10/1/2044		180,934
	96,782	Loan ID 200886	Fixed	4.250%	10/1/2044		99,142
	254,711	Loan ID 200887	Fixed	4.750%	9/1/2044		267,446
	239,212	Loan ID 200888	Fixed	4.500%	9/1/2044		226,038
	135,724	Loan ID 200890	Fixed	4.375%	11/1/2044		125,676
	209,057	Loan ID 200891	Fixed	4.250%	10/1/2044		217,237
	256,876	Loan ID 200892	Fixed	3.750%	9/1/2043		232,491
	224,848	Loan ID 200893	Fixed	5.000%	11/1/2043		236,091
	99,237	Loan ID 200894	Fixed	5.000%	10/1/2043		104,199
	227,978	Loan ID 200895	Fixed	3.875%	11/1/2043		237,593
	196,861	Loan ID 200897	Fixed	4.750%	10/1/2044		143,421
	222,207	Loan ID 200898	Fixed	4.250%	10/1/2043		112,075
	375,931	Loan ID 200900	Fixed	4.375%	9/1/2044		365,781
	667,346	Loan ID 200902	Fixed	4.250%	9/1/2044		700,713
	253,174	Loan ID 200904	Fixed	5.125%	9/1/2044		250,240
	405,188	Loan ID 200905	Fixed	5.375%	9/1/2044		425,448
	316,641	Loan ID 200906	Fixed	4.875%	2/1/2035		332,473
	354,917	Loan ID 200907	ARM	3.500%	8/1/2047		308,152
	106,772	Loan ID 200908	Fixed	4.000%	6/1/2049		110,514
	116,375	Loan ID 200909	Fixed	4.870%	3/1/2046		122,194
	205,283	Loan ID 200910	Fixed	3.300%	4/1/2053		117,701
	150,092	Loan ID 200911	Fixed	3.380%	9/1/2053		75,938
	723,314	Loan ID 200912	Interest Only	4.500%	3/1/2037		643,802
	60,075	Loan ID 200913	Fixed	4.250%	5/1/2047		52,858
	152,641	Loan ID 200914	Fixed	2.875%	12/1/2047		151,950
	95,987	Loan ID 200916	Fixed	4.000%	10/1/2037		97,662
	161,159	Loan ID 200917	Fixed	4.875%	1/1/2051		169,217
	514,211	Loan ID 200918	Fixed	3.875%	10/1/2035		459,201
	553,014	Loan ID 200919	Fixed	3.000%	8/1/2045		482,084
	99,142	Loan ID 200921	ARM	3.500%	7/1/2051		104,099
	427,233	Loan ID 200922	Fixed	3.340%	9/1/2053		392,185
	435,778	Loan ID 200923	Fixed	3.750%	12/1/2036		380,696
	512,234	Loan ID 200924	Fixed	5.500%	9/1/2051		449,909
	465,963	Loan ID 200925	Fixed	4.000%	4/1/2055		488,047
	333,867	Loan ID 200927	Fixed	3.000%	8/1/2038		334,602
	125,071	Loan ID 200928	Fixed	4.800%	12/1/2036		131,324
	164,169	Loan ID 200929	Fixed	4.625%	1/1/2043		172,377
	244,240	Loan ID 200930	Fixed	3.000%	12/1/2050		189,605
	392,258	Loan ID 200931	Fixed	4.250%	12/1/2052		317,778
	307,897	Loan ID 200933	Fixed	4.250%	3/1/2043		323,292
	116,827	Loan ID 200934	Fixed	3.810%	1/1/2043		121,314
	181,454	Loan ID 200935	Fixed	3.875%	4/1/2043		189,160

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

17 

Vertical Capital Income Fund

PORTFOLIO OF INVESTMENTS (Continued)

September 30, 2016

Principal			Loan Type	Interest Rate	Maturity	Value
		MORTGAGE NOTES (Continued) - 93.2 %
$	199,197	Loan ID 200936	Fixed	4.000%	5/1/2042	$	208,492
	176,917	Loan ID 200938	Fixed	4.125%	4/1/2043		184,832
	124,262	Loan ID 200939	Fixed	4.170%	5/1/2042		130,475
	203,315	Loan ID 200940	Fixed	3.250%	2/1/2043		205,351
	118,572	Loan ID 200941	Fixed	3.780%	1/1/2043		123,024
	284,791	Loan ID 200942	Fixed	4.000%	4/1/2043		298,299
	106,170	Loan ID 200944	Fixed	4.500%	2/1/2044		109,491
	143,515	Loan ID 200945	Fixed	5.125%	4/1/2044		150,691
	294,054	Loan ID 200947	Fixed	4.000%	2/1/2043		307,545
	131,514	Loan ID 200948	Fixed	4.625%	12/1/2042		128,769
	287,084	Loan ID 200949	Fixed	3.875%	4/1/2043		299,600
	185,624	Loan ID 200952	Fixed	3.875%	1/1/2043		193,418
	120,207	Loan ID 200953	Fixed	3.750%	12/1/2042		122,363
	386,835	Loan ID 200954	Fixed	3.625%	1/1/2043		399,035
	336,903	Loan ID 200955	Fixed	3.250%	5/1/2043		341,104
	265,727	Loan ID 200956	Fixed	5.000%	8/1/2051		279,013
	170,860	Loan ID 200957	Fixed	3.875%	6/1/2043		178,201
	98,277	Loan ID 200958	Fixed	3.875%	6/1/2043		102,086
	427,365	Loan ID 200959	Fixed	4.000%	11/1/2042		448,056
	383,457	Loan ID 200960	Fixed	3.500%	1/1/2043		392,403
	181,967	Loan ID 200961	Fixed	4.750%	6/1/2043		191,066
	210,691	Loan ID 200962	Fixed	4.250%	10/1/2044		218,070
	120,221	Loan ID 200963	Fixed	4.750%	9/1/2044		116,402
	360,887	Loan ID 200964	Fixed	3.750%	7/1/2043		374,540
	209,739	Loan ID 200965	Fixed	4.125%	11/1/2044		191,808
	148,874	Loan ID 200966	Fixed	4.875%	7/1/2044		142,842
	96,729	Loan ID 200968	Fixed	4.250%	11/1/2044		88,188
	368,915	Loan ID 200969	Fixed	4.875%	8/1/2043		387,361
	135,442	Loan ID 200972	Fixed	4.750%	2/1/2044		142,214
	156,903	Loan ID 200974	Fixed	4.250%	10/1/2044		162,130
	58,200	Loan ID 200975	Fixed	4.750%	12/1/2044		61,110
	357,587	Loan ID 200977	Fixed	4.875%	9/1/2044		375,466
	180,874	Loan ID 200980	Fixed	4.250%	11/1/2044		185,391
	213,448	Loan ID 200983	Fixed	4.375%	8/1/2044		221,897
	155,470	Loan ID 200984	Fixed	5.000%	10/1/2043		163,244
	263,975	Loan ID 200985	Fixed	4.250%	12/1/2044		249,878
	156,254	Loan ID 200986	Fixed	4.250%	12/1/2044		164,067
	116,292	Loan ID 200987	Fixed	4.625%	10/1/2044		121,964
	222,853	Loan ID 200989	Fixed	3.750%	6/1/2029		215,173
	290,338	Loan ID 200992	Fixed	4.125%	5/1/2043		304,855
	172,500	Loan ID 200993	Fixed	2.004%	7/15/2049		152,681
	205,397	Loan ID 200994	Fixed	4.125%	5/1/2053		203,273
	200,393	Loan ID 200995	Fixed	2.750%	5/1/2047		121,436
	57,563	Loan ID 200996	Fixed	2.500%	8/1/2048		41,784

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

18 

Vertical Capital Income Fund

PORTFOLIO OF INVESTMENTS (Continued)

September 30, 2016

Principal			Loan Type	Interest Rate	Maturity	Value
		MORTGAGE NOTES (Continued) - 93.2%
$	99,599	Loan ID 200997	Fixed	2.000%	3/1/2051	$	72,116
	369,822	Loan ID 200998	Fixed	3.875%	12/1/2050		341,301
	98,153	Loan ID 200999	Fixed	4.250%	4/1/2044		98,153
	74,795	Loan ID 201000	Fixed	5.125%	2/1/2039		73,257
	107,698	Loan ID 201001	Fixed	7.413%	9/1/2037		43,773
	33,348	Loan ID 201002	Fixed	0.000%	10/1/2024		35,015
	132,966	Loan ID 201005	Fixed	4.750%	7/1/2041		139,614
	44,242	Loan ID 201006	Fixed	6.875%	3/1/2038		46,454
	83,521	Loan ID 201007	Fixed	7.125%	4/1/2037		87,697
	78,595	Loan ID 201008	Fixed	7.125%	10/1/2038		82,525
	72,916	Loan ID 201009	Fixed	0.000%	4/1/2033		76,561
	82,394	Loan ID 201010	Fixed	5.500%	4/1/2039		82,394
	44,454	Loan ID 201011	Fixed	0.000%	2/1/2023		46,676
	47,153	Loan ID 201012	Fixed	7.500%	12/1/2038		49,511
	57,310	Loan ID 201013	Fixed	7.500%	12/1/2038		50,905
	94,788	Loan ID 201014	Fixed	0.000%	2/1/2033		99,527
	17,107	Loan ID 201015	Fixed	0.000%	3/29/2021		17,955
	108,867	Loan ID 201016	Fixed	6.500%	2/1/2036		111,537
	26,971	Loan ID 201017	Fixed	0.000%	4/1/2032		28,320
	318,928	Loan ID 201018	Fixed	6.750%	6/1/2037		334,874
	100,670	Loan ID 201019	ARM	2.875%	2/1/2037		105,704
	99,469	Loan ID 201020	Fixed	0.000%	10/1/2034		104,443
	105,838	Loan ID 201021	Fixed	6.870%	8/1/2047		111,130
	81,774	Loan ID 201022	ARM	3.125%	5/1/2037		65,350
	145,668	Loan ID 201023	Fixed	6.450%	2/1/2036		124,531
	100,986	Loan ID 201024	Fixed	9.000%	3/1/2037		106,036
	188,790	Loan ID 201025	ARM	2.875%	1/1/2042		180,123
	82,606	Loan ID 201026	Fixed	7.750%	12/1/2035		47,428
	107,716	Loan ID 201027	Fixed	9.538%	3/1/2037		113,102
	171,735	Loan ID 201028	Fixed	4.625%	4/1/2044		180,322
	105,503	Loan ID 201030	Fixed	5.000%	7/1/2042		110,778
	144,446	Loan ID 201032	Fixed	4.500%	11/1/2044		107,567
	291,788	Loan ID 201033	Fixed	4.125%	12/1/2044		302,815
	104,837	Loan ID 201035	Fixed	4.375%	9/1/2044		63,302
	98,616	Loan ID 201036	Fixed	4.375%	12/1/2044		93,729
	70,106	Loan ID 201037	Fixed	8.250%	7/1/2039		73,611
	112,620	Loan ID 201038	Fixed	8.250%	5/1/2039		59,755
	462,886	Loan ID 201039	ARM	4.500%	10/1/2045		292,013
	279,729	Loan ID 201040	Fixed	3.000%	11/1/2045		212,198
	92,214	Loan ID 201041	Fixed	3.750%	11/1/2052		76,363
	119,377	Loan ID 201043	Fixed	4.000%	4/1/2039		113,587
	186,605	Loan ID 201044	Fixed	4.870%	3/29/2037		195,935
	113,886	Loan ID 201045	Fixed	2.000%	7/1/2037		105,668
	267,655	Loan ID 201046	Fixed	2.000%	4/1/2053		203,911

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

19 

Vertical Capital Income Fund

PORTFOLIO OF INVESTMENTS (Continued)

September 30, 2016

Principal			Loan Type	Interest Rate	Maturity	Value
		MORTGAGE NOTES (Continued) - 93.2 %
$	110,337	Loan ID 201047	Fixed	3.000%	4/1/2053	$	83,163
	176,205	Loan ID 201048	Fixed	2.000%	4/1/2052		125,083
	488,685	Loan ID 201049	Fixed	2.000%	4/1/2052		325,704
	651,716	Loan ID 201050	Fixed	2.000%	8/1/2053		399,180
	275,156	Loan ID 201051	Fixed	3.174%	9/1/2053		229,742
	130,646	Loan ID 201052	Fixed	3.000%	4/1/2053		59,726
	66,327	Loan ID 201053	Fixed	3.860%	7/1/2053		57,071
	215,529	Loan ID 201054	Fixed	2.400%	5/17/2050		196,237
	603,507	Loan ID 201056	Fixed	2.000%	7/1/2054		553,379
	171,141	Loan ID 201057	Fixed	2.000%	1/1/2050		155,768
	139,047	Loan ID 201058	Fixed	2.500%	8/1/2037		102,474
	136,656	Loan ID 201059	Fixed	2.000%	4/1/2053		126,804
	117,126	Loan ID 201060	ARM	3.375%	7/1/2035		76,880
	87,990	Loan ID 201061	Fixed	4.000%	3/1/2050		59,573
	121,841	Loan ID 201062	Fixed	3.100%	4/1/2047		120,872
	126,883	Loan ID 201063	Fixed	4.000%	9/1/2047		110,079
	51,340	Loan ID 201064	Fixed	2.000%	12/1/2052		41,789
	217,106	Loan ID 201065	Fixed	3.000%	7/1/2037		170,596
	235,032	Loan ID 201066	Fixed	4.250%	12/1/2046		246,784
	444,133	Loan ID 201067	Fixed	4.750%	1/1/2044		434,095
	303,790	Loan ID 201068	Fixed	5.250%	5/1/2044		318,979
	70,478	Loan ID 201069	Fixed	4.625%	12/1/2044		73,155
	628,929	Loan ID 201070	Fixed	4.250%	2/1/2045		657,872
	181,044	Loan ID 201071	Fixed	4.625%	11/1/2044		172,114
	119,855	Loan ID 201072	Fixed	3.500%	3/1/2028		98,168
	50,129	Loan ID 201073	Fixed	3.125%	4/1/2023		50,130
	97,742	Loan ID 201075	Fixed	4.375%	10/1/2044		101,867
	129,557	Loan ID 201076	Fixed	3.500%	12/1/2042		130,610
	138,013	Loan ID 201077	Fixed	3.625%	7/1/2044		124,877
	268,228	Loan ID 201081	ARM	3.000%	10/1/2044		275,455
	125,708	Loan ID 201082	Fixed	3.875%	12/1/2044		114,247
	373,769	Loan ID 201083	Fixed	5.375%	2/1/2044		187,315
	231,187	Loan ID 201084	Fixed	5.000%	8/1/2038		242,746
	149,822	Loan ID 201086	Fixed	4.625%	11/1/2044		144,295
	273,958	Loan ID 201089	Fixed	4.000%	8/1/2044		229,927
	255,789	Loan ID 201090	Fixed	3.625%	11/1/2044		262,014
	162,092	Loan ID 201091	Fixed	4.125%	1/1/2045		151,165
	261,620	Loan ID 201092	Fixed	5.250%	4/1/2046		274,701
	139,883	Loan ID 201093	Fixed	4.125%	9/1/2043		72,194
	154,450	Loan ID 201094	Fixed	4.550%	3/1/2044		147,654
	237,828	Loan ID 201095	Fixed	3.875%	8/1/2044		223,480
	240,063	Loan ID 201097	Fixed	3.990%	1/1/2045		217,860
	149,950	Loan ID 201099	Fixed	2.875%	3/1/2030		141,865
	99,113	Loan ID 201100	Fixed	4.125%	7/1/2043		104,069

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

20 

Vertical Capital Income Fund

PORTFOLIO OF INVESTMENTS (Continued)

September 30, 2016

Principal			Loan Type	Interest Rate	Maturity	Value
		MORTGAGE NOTES (Continued) - 93.2 %
$	356,029	Loan ID 201101	Fixed	4.625%	3/1/2045	$	336,121
	158,205	Loan ID 201103	ARM	2.875%	5/1/2044		161,986
	162,984	Loan ID 201104	Fixed	4.375%	4/1/2045		152,946
	299,329	Loan ID 201105	Fixed	4.250%	11/1/2044		313,420
	81,623	Loan ID 201107	Fixed	5.150%	2/1/2036		80,397
	154,167	Loan ID 201108	Fixed	4.750%	2/1/2054		149,072
	542,238	Loan ID 201110	ARM	3.875%	4/1/2037		351,485
	162,271	Loan ID 201111	Fixed	4.000%	4/1/2050		86,188
	252,960	Loan ID 201112	Fixed	4.750%	8/1/2037		226,397
	79,070	Loan ID 201113	Fixed	5.750%	12/1/2052		83,023
	110,936	Loan ID 201114	Fixed	8.087%	5/1/2054		68,664
	514,669	Loan ID 201115	Fixed	4.000%	2/1/2051		481,040
	82,756	Loan ID 201116	Fixed	4.250%	10/1/2052		38,246
	129,773	Loan ID 201117	Fixed	4.500%	11/1/2037		89,964
	247,582	Loan ID 201118	Fixed	2.000%	11/1/2054		135,960
	131,536	Loan ID 201119	Fixed	4.000%	5/1/2034		133,341
	53,912	Loan ID 201120	Fixed	4.500%	4/1/2037		47,807
	93,687	Loan ID 201121	Fixed	3.000%	10/1/2037		69,318
	86,639	Loan ID 201122	Fixed	4.750%	11/1/2048		83,942
	174,190	Loan ID 201123	Fixed	3.000%	7/1/2054		46,892
	252,361	Loan ID 201124	Fixed	4.750%	4/1/2040		221,206
	440,026	Loan ID 201126	Fixed	6.500%	4/1/2049		236,591
	82,790	Loan ID 201127	ARM	2.750%	4/1/2037		26,844
	279,677	Loan ID 201128	Fixed	2.000%	10/1/2036		153,148
	160,663	Loan ID 201129	Fixed	4.875%	6/1/2051		156,064
	123,838	Loan ID 201130	Fixed	4.850%	2/1/2038		123,838
	120,586	Loan ID 201131	Fixed	5.353%	5/1/2053		109,553
	171,612	Loan ID 201132	Fixed	3.000%	7/1/2037		128,787
	154,252	Loan ID 201133	Fixed	2.000%	6/1/2051		116,028
	200,530	Loan ID 201134	Fixed	2.000%	10/1/2053		141,215
	533,991	Loan ID 201135	Fixed	2.000%	6/1/2051		430,889
	526,947	Loan ID 201136	Fixed	2.000%	2/1/2036		458,641
	292,190	Loan ID 201137	Fixed	2.000%	12/1/2052		221,612
	60,419	Loan ID 201138	Fixed	4.250%	3/1/2034		50,730
	164,122	Loan ID 201139	Fixed	2.000%	11/1/2053		125,535
	159,519	Loan ID 201140	Fixed	4.870%	1/1/2038		154,931
	143,843	Loan ID 201141	Fixed	2.000%	5/1/2052		107,632
	450,559	Loan ID 201142	Fixed	2.000%	9/1/2035		356,782
	91,059	Loan ID 201143	Fixed	2.000%	11/1/2037		84,684
	103,175	Loan ID 201144	Fixed	3.000%	9/1/2045		90,960
	230,500	Loan ID 201145	Fixed	4.375%	4/1/2051		219,508
	133,567	Loan ID 201146	Fixed	4.875%	8/1/2054		120,002
	110,605	Loan ID 201147	Fixed	2.000%	11/1/2051		90,177
	98,568	Loan ID 201148	Fixed	3.950%	10/1/2042		92,036

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

21 

Vertical Capital Income Fund

PORTFOLIO OF INVESTMENTS (Continued)

September 30, 2016

Principal			Loan Type		Interest Rate	Maturity	Value
		MORTGAGE NOTES (Continued) - 93.2 %
$	279,690	Loan ID 201149	Fixed		5.719%	6/1/2051	$	215,765
	103,463	Loan ID 201150	Fixed		2.000%	7/1/2037		93,066
	479,473	Loan ID 201152	Fixed		2.000%	8/1/2050		411,065
	250,771	Loan ID 201153	Fixed		4.000%	6/1/2050		182,833
	62,272	Loan ID 201154	ARM		3.500%	11/1/2041		65,386
	96,306	Loan ID 201155	Fixed		2.000%	11/1/2053		63,890
	64,918	Loan ID 201156	Fixed		4.000%	4/1/2050		47,009
	292,248	Loan ID 201157	Fixed		4.000%	3/1/2055		305,966
	296,999	Loan ID 201158	Fixed		2.000%	8/1/2052		239,794
	71,364	Loan ID 201159	Fixed		2.000%	6/1/2039		23,301
	204,091	Loan ID 201160	Fixed		4.000%	10/1/2049		114,951
	297,316	Loan ID 201161	Fixed		3.000%	6/1/2054		157,685
	143,746	Loan ID 201162	Fixed		2.125%	12/1/2052		95,870
	384,451	Loan ID 201163	Fixed		4.000%	12/1/2049		187,858
	166,362	Loan ID 201164	Fixed		3.000%	11/1/2051		136,128
	114,490	Loan ID 201165	Fixed		4.750%	1/1/2044		120,215
	120,160	Loan ID 201166	Fixed		2.000%	12/1/2054		99,501
	438,189	Loan ID 201168	Fixed		2.000%	4/1/2052		350,466
	110,773	Loan ID 201169	Fixed		5.934%	9/1/2037		105,063
	67,991	Loan ID 201170	Fixed		4.365%	7/1/2037		55,101
	69,755	Loan ID 201171	Fixed		2.000%	5/1/2051		55,464
	104,885	Loan ID 201172	Fixed		4.000%	6/1/2050		82,232
	109,641	Loan ID 201173	Fixed		2.000%	11/1/2047		26,249
	148,956	Loan ID 201174	Fixed		4.750%	1/1/2053		146,877
	64,594	Loan ID 201175	Fixed		4.000%	9/1/2044		56,940
	135,646	Loan ID 201176	Fixed		4.250%	8/1/2053		128,876
	269,053	Loan ID 201177	Fixed		2.000%	7/1/2046		223,354
	308,265	Loan ID 201178	Fixed		3.193%	6/1/2051		129,145
	302,516	Loan ID 201179	Fixed		3.000%	5/1/2051		175,559
	419,345	Loan ID 201180	Fixed		2.000%	6/1/2053		357,908
	319,672	Loan ID 201181	Fixed		4.500%	4/1/2034		292,122
	51,475	Loan ID 201182	Fixed		3.290%	3/1/2034		41,257
	135,752	Loan ID 201183	Fixed	��	2.375%	10/1/2052		103,658
	64,134	Loan ID 201184	Fixed		4.000%	6/1/2049		67,080
	261,114	Loan ID 201185	Fixed		5.760%	10/1/2053		274,169
	82,720	Loan ID 201187	Fixed		2.000%	11/1/2048		45,673
	626,909	Loan ID 201188	Fixed		2.000%	8/1/2052		449,306
	105,541	Loan ID 201189	Fixed		4.500%	12/1/2051		110,818
	161,115	Loan ID 201190	Fixed		4.250%	6/1/2051		169,171
	212,664	Loan ID 201191	Fixed		3.000%	2/1/2037		206,763
	117,776	Loan ID 201192	Fixed		2.000%	2/1/2051		104,230
	232,449	Loan ID 201193	Fixed		3.000%	5/1/2051		131,614
	329,911	Loan ID 201194	Fixed		2.000%	6/1/2054		244,644
	148,113	Loan ID 201195	Fixed		3.500%	5/1/2036		127,134

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

22 

Vertical Capital Income Fund

PORTFOLIO OF INVESTMENTS (Continued)

September 30, 2016

Principal			Loan Type	Interest Rate	Maturity	Value
		MORTGAGE NOTES (Continued) - 93.2 %
$	640,373	Loan ID 201196	Fixed	2.000%	11/1/2036	$	525,622
	178,477	Loan ID 201197	Fixed	5.125%	8/1/2037		163,793
	51,310	Loan ID 201198	Fixed	4.125%	9/1/2053		53,725
	339,506	Loan ID 201199	Fixed	3.000%	11/1/2046		268,326
	293,204	Loan ID 201200	Fixed	4.500%	3/1/2044		286,601
	295,021	Loan ID 201201	Fixed	4.500%	8/1/2044		309,772
	193,716	Loan ID 201202	Fixed	3.750%	8/1/2044		172,672
	127,459	Loan ID 201203	Fixed	3.875%	12/1/2044		116,498
	460,095	Loan ID 201204	Fixed	3.750%	4/1/2045		474,307
	152,230	Loan ID 201205	Fixed	4.625%	1/1/2045		157,877
	132,573	Loan ID 201206	Fixed	3.990%	4/1/2045		138,058
	425,231	Loan ID 201207	Fixed	4.625%	8/1/2051		398,382
	117,533	Loan ID 201208	Fixed	4.625%	4/1/2045		117,533
	182,572	Loan ID 201209	Fixed	4.250%	4/1/2045		181,752
	175,987	Loan ID 201210	Fixed	3.500%	12/1/2042		144,678
	132,112	Loan ID 201211	Fixed	4.125%	7/1/2044		125,285
	367,806	Loan ID 201212	Fixed	4.625%	3/1/2045		261,260
	203,391	Loan ID 201213	Fixed	4.875%	8/1/2044		207,989
	560,203	Loan ID 201214	ARM	2.875%	9/1/2043		497,704
	272,106	Loan ID 201216	Fixed	3.500%	2/1/2043		244,664
	103,921	Loan ID 201217	Fixed	3.875%	5/1/2045		97,850
	128,885	Loan ID 201218	Fixed	4.125%	1/1/2045		119,713
	69,876	Loan ID 201219	Fixed	4.000%	7/1/2044		71,955
	295,961	Loan ID 201220	Fixed	4.125%	8/1/2045		270,118
	67,146	Loan ID 201221	Fixed	3.250%	5/1/2043		57,795
	48,841	Loan ID 201222	Fixed	5.125%	1/1/2045		49,372
	230,614	Loan ID 201223	Fixed	3.875%	4/1/2030		241,728
	254,021	Loan ID 201224	Fixed	4.625%	9/1/2044		266,722
	62,202	Loan ID 201226	Fixed	5.000%	3/1/2045		65,265
	179,617	Loan ID 201227	Fixed	5.125%	3/1/2045		186,249
	66,515	Loan ID 201228	Fixed	4.625%	3/1/2045		68,184
	102,601	Loan ID 201229	Fixed	3.250%	7/1/2024		103,923
	205,053	Loan ID 201230	Fixed	3.875%	3/1/2045		207,907
	209,833	Loan ID 201231	Fixed	4.250%	8/1/2045		213,175
	126,574	Loan ID 201232	Fixed	4.500%	1/1/2045		127,627
	262,524	Loan ID 201233	Fixed	4.500%	12/1/2044		250,180
	204,351	Loan ID 201234	Fixed	5.000%	10/1/2045		195,333
	93,934	Loan ID 201235	Fixed	3.750%	7/1/2045		94,119
	68,932	Loan ID 201236	Fixed	5.250%	2/1/2044		72,378
	241,993	Loan ID 201237	Fixed	3.750%	5/1/2045		245,596
	203,453	Loan ID 201238	Fixed	5.125%	12/1/2044		213,625
	191,455	Loan ID 201239	Fixed	4.500%	3/1/2045		201,028
	161,027	Loan ID 201240	Fixed	4.250%	10/1/2045		168,406
	301,856	Loan ID 201241	Fixed	4.375%	7/1/2045		314,331

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

23 

Vertical Capital Income Fund

PORTFOLIO OF INVESTMENTS (Continued)

September 30, 2016

Principal			Loan Type	Interest Rate	Maturity	Value
		MORTGAGE NOTES (Continued) - 93.2 %
$	230,765	Loan ID 201242	Fixed	4.625%	11/1/2044	$	241,256
	112,995	Loan ID 201243	Fixed	4.625%	11/1/2045		115,022
	408,003	Loan ID 201244	Fixed	4.500%	6/1/2045		381,433
	117,921	Loan ID 201245	Fixed	4.750%	8/1/2044		113,488
	324,298	Loan ID 201246	Fixed	4.750%	1/1/2045		314,778
	190,300	Loan ID 201247	Fixed	4.250%	5/1/2045		157,631
	102,740	Loan ID 201248	Fixed	4.875%	7/1/2044		107,331
	473,252	Loan ID 201249	Fixed	4.625%	8/1/2045		433,194
	64,733	Loan ID 201250	Fixed	4.250%	10/1/2045		66,799
	133,471	Loan ID 201251	Fixed	4.500%	8/1/2045		124,920
	12,501	Loan ID 201253	ARM	8.750%	3/1/2019		13,127
	164,102	Loan ID 201254	ARM	6.840%	9/1/2034		172,307
	250,937	Loan ID 201255	ARM	7.000%	6/1/2035		263,484
	41,615	Loan ID 201256	ARM	10.500%	10/1/2021		43,696
	244,817	Loan ID 201257	Fixed	4.500%	5/1/2044		256,580
	92,929	Loan ID 201258	Fixed	4.500%	6/1/2045		78,368
	121,051	Loan ID 201259	Fixed	4.625%	1/1/2046		99,833
	175,244	Loan ID 201260	Fixed	4.750%	9/1/2045		183,775
	102,237	Loan ID 201261	Fixed	4.125%	6/1/2045		105,791
	61,979	Loan ID 201262	Fixed	4.200%	1/1/2046		63,943
	51,295	Loan ID 201263	Fixed	4.750%	10/1/2045		43,251
	191,094	Loan ID 201264	Fixed	5.000%	3/1/2045		118,992
	365,276	Loan ID 201265	Fixed	4.750%	6/1/2045		373,460
	148,804	Loan ID 201266	Fixed	4.500%	2/1/2046		148,271
	190,829	Loan ID 201267	Fixed	4.875%	12/1/2045		190,084
	242,095	Loan ID 201268	Fixed	4.250%	6/1/2045		252,274
	127,413	Loan ID 201269	Fixed	4.375%	12/1/2045		82,954
	156,061	Loan ID 201270	Fixed	4.125%	2/1/2045		146,047
	260,521	Loan ID 201271	Fixed	4.500%	6/1/2045		243,300
	142,782	Loan ID 201272	Fixed	4.750%	11/1/2044		146,293
	245,977	Loan ID 201273	Fixed	4.500%	12/1/2045		249,169
	223,067	Loan ID 201274	Fixed	4.125%	10/1/2045		206,045
	575,930	Loan ID 201276	Fixed	4.000%	11/1/2045		604,727
	197,482	Loan ID 201278	Fixed	3.750%	12/1/2045		169,787
	321,501	Loan ID 201279	Fixed	4.875%	3/1/2046		250,791
	377,976	Loan ID 201280	Fixed	4.500%	4/1/2046		366,877
	156,603	Loan ID 201281	Fixed	4.875%	7/1/2044		164,434
	131,918	Loan ID 201282	Fixed	5.250%	1/1/2046		126,557
	113,390	Loan ID 201283	Fixed	4.250%	11/1/2045		115,928
	144,472	Loan ID 201284	Fixed	3.625%	2/1/2029		151,145
	35,413	Loan ID 201285	Fixed	4.625%	11/1/2028		37,184
	112,598	Loan ID 201286	Fixed	4.375%	12/1/2045		115,958
	189,872	Loan ID 201287	Fixed	3.625%	4/1/2046		191,605
	126,757	Loan ID 201288	Fixed	4.500%	2/1/2046		115,281

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

24 

Vertical Capital Income Fund

PORTFOLIO OF INVESTMENTS (Continued)

September 30, 2016

Principal			Loan Type	Interest Rate	Maturity	Value
		MORTGAGE NOTES (Continued) - 93.2 %
$	87,459	Loan ID 201289	Fixed	4.000%	3/1/2045	$	89,434
	254,748	Loan ID 201290	Fixed	4.750%	7/1/2045		266,822
	310,353	Loan ID 201291	Fixed	5.000%	8/1/2045		316,576
	83,285	Loan ID 201292	Fixed	4.500%	5/1/2045		87,449
	37,919	Loan ID 201293	Fixed	4.875%	9/1/2045		39,005
	129,469	Loan ID 201294	Fixed	4.625%	2/1/2046		116,115
	101,326	Loan ID 201295	Fixed	4.500%	12/1/2045		83,055
	780,319	Loan ID 201296	Fixed	4.250%	2/1/2046		805,868
	349,691	Loan ID 201297	Fixed	4.875%	8/1/2045		367,176
	156,231	Loan ID 201298	Fixed	4.250%	8/1/2045		161,002
	261,468	Loan ID 201299	Fixed	4.250%	12/1/2045		203,794
	201,452	Loan ID 201300	Fixed	4.750%	3/1/2046		203,801
	75,280	Loan ID 201301	Fixed	4.550%	10/1/2044		77,233
	139,114	Loan ID 201302	Fixed	4.250%	5/1/2045		144,573
	100,192	Loan ID 201303	Fixed	3.875%	3/1/2045		102,889
	234,810	Loan ID 201304	Fixed	4.125%	2/1/2046		205,070
	152,287	Loan ID 201305	Fixed	4.625%	8/1/2044		157,092
	120,761	Loan ID 201306	Fixed	3.875%	9/1/2045		104,628
	171,225	Loan ID 201307	Fixed	4.250%	11/1/2045		155,187
	64,523	Loan ID 201308	Fixed	4.625%	11/1/2045		66,390
	167,601	Loan ID 201309	Fixed	4.000%	9/1/2045		110,865
	192,005	Loan ID 201310	Fixed	4.750%	9/1/2045		164,770
	140,740	Loan ID 201311	Fixed	4.375%	3/1/2046		139,842
	174,051	Loan ID 201312	Fixed	4.250%	2/1/2046		179,073
	331,027	Loan ID 201313	Fixed	4.625%	1/1/2046		336,066
	115,710	Loan ID 201315	Fixed	4.375%	9/1/2045		117,389
	166,246	Loan ID 201316	Fixed	4.500%	2/1/2046		127,797
	170,551	Loan ID 201317	Fixed	5.250%	2/1/2046		160,610
	87,594	Loan ID 201318	Fixed	4.750%	11/1/2045		74,865
	177,213	Loan ID 201319	Fixed	4.375%	10/1/2045		159,836
	169,397	Loan ID 201320	Fixed	4.000%	10/1/2045		173,726
	99,824	Loan ID 201321	Fixed	4.000%	1/1/2046		85,977
	142,617	Loan ID 201322	Fixed	4.750%	9/1/2045		147,745
	126,980	Loan ID 201323	Fixed	4.375%	7/1/2045		130,445
	139,256	Loan ID 201324	Fixed	5.250%	4/1/2046		124,675
	213,831	Loan ID 201325	Fixed	4.500%	5/1/2046		184,152
	181,771	Loan ID 201326	Fixed	4.625%	3/1/2046		161,424
	214,630	Loan ID 201327	Fixed	4.250%	9/1/2045		221,574
	196,676	Loan ID 201328	Fixed	4.250%	11/1/2045		172,492
	164,368	Loan ID 201329	Fixed	4.250%	11/1/2045		129,373
	277,221	Loan ID 201330	Fixed	4.375%	6/1/2046		252,888
	365,294	Loan ID 201331	Fixed	4.250%	10/1/2044		376,549
	275,780	Loan ID 201332	Fixed	4.000%	11/1/2045		239,004
	358,973	Loan ID 201333	Fixed	3.875%	1/1/2046		305,524

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

25 

Vertical Capital Income Fund

PORTFOLIO OF INVESTMENTS (Continued)

September 30, 2016

Principal			Loan Type	Interest Rate	Maturity	Value
		MORTGAGE NOTES (Continued) - 93.2%
$	398,393	Loan ID 201334	Fixed	4.500%	3/1/2044	$	418,313
	197,283	Loan ID 201335	Fixed	4.750%	1/1/2046		203,040
	195,031	Loan ID 201336	Fixed	4.750%	1/1/2046		153,844
	141,499	Loan ID 201337	Fixed	9.500%	1/1/2046		148,574
	141,240	Loan ID 201338	Fixed	4.375%	10/1/2045		143,070
	428,795	Loan ID 201339	Fixed	4.625%	7/1/2045		369,501
	127,485	Loan ID 201340	Fixed	4.375%	7/1/2045		117,167
	150,905	Loan ID 201341	Fixed	4.050%	11/1/2045		135,284
	148,760	Loan ID 201342	Fixed	4.750%	7/1/2045		153,272
	90,361	Loan ID 201343	Fixed	4.250%	11/1/2045		92,089
	75,439	Loan ID 201344	Fixed	5.000%	7/1/2044		79,211
	140,669	Loan ID 201345	Fixed	4.125%	5/1/2045		125,912
	482,975	Loan ID 201347	Fixed	5.750%	5/1/2046		507,124
	467,323	Loan ID 201348	Fixed	6.500%	5/1/2046		490,689
	243,410	Loan ID 201349	Fixed	5.625%	2/1/2046		255,091
	251,717	Loan ID 201350	Fixed	4.000%	6/1/2045		230,249
	64,349	Loan ID 201351	Fixed	4.500%	4/1/2045		46,108
	76,167	Loan ID 201352	Fixed	4.875%	3/1/2045		78,891
	507,739	Loan ID 201353	ARM	3.875%	5/1/2046		532,492
	525,055	Loan ID 201354	Fixed	3.375%	7/1/2046		523,788
	137,878	Loan ID 201355	Fixed	5.250%	12/1/2045		141,568
	107,180	Loan ID 201356	Fixed	4.625%	10/1/2045		108,096
	124,335	Loan ID 201357	Fixed	4.750%	5/1/2046		120,096
	154,716	Loan ID 201358	Fixed	4.875%	7/1/2045		148,088
	196,137	Loan ID 201359	Fixed	4.250%	9/1/2045		200,101
	287,468	Loan ID 201360	Fixed	4.375%	9/1/2044		300,098
	149,147	Loan ID 201361	Fixed	5.250%	7/1/2044		156,605
	120,288	Loan ID 201362	Fixed	4.375%	4/1/2036		115,890
	128,849	Loan ID 201363	Fixed	4.250%	2/1/2046		102,439
	115,978	Loan ID 201364	Fixed	3.875%	4/1/2046		95,828
	188,940,143	TOTAL MORTGAGE NOTES (Cost - $150,396,153)*		’			169,713,431
		OTHER INVESTMENTS* (Cost - $366,499)(a) - 0.2%					404,767
		TOTAL INVESTMENTS (Cost - $150,762,652)(a) - 93.4%				$	170,118,198
		OTHER ASSETS IN EXCESS OF LIABILITIES - 6.6%					11,890,119
		NET ASSETS - 100.0%				$	182,008,317

ARM - Adjustable Rate Mortgage

* Illiquid Securities

** Non -income producing security.

(a) Represents cost for financial reporting purposes. Aggregate cost for federal tax purposes is the same as there are no book to tax differences.

Unrealized appreciation:	$	24,437,676
Unrealized depreciation:		(5,082,130	)
Net unrealized appreciation:	$	19,355,546

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

26 

Vertical Capital Income Fund

Statement of Assets and Liabilities

September 30, 2016

Assets:
Investments at Value (identified cost $150,762,652)	$	170,118,198
Cash		8,337,456
Interest Receivable		2,024,096
Receivable for Securities Sold and Principal Paydowns		703,275
Receivable for Fund Shares Sold		108,950
Due from Investment Adviser		1,314,486
Deferred Financing Fees, Net		77,231
Prepaid Expenses and Other Assets		829,331
Total Assets		183,513,023
Liabilities:
Related Party Payable		26,234
Payable to Shareholders		1,332,484
Accrued Expenses and Other Liabilities		145,988
Total Liabilities		1,504,706
Net Assets	$	182,008,317
Composition of Net Assets:
At September 30, 2016, Net Assets consisted of:
Paid-in-Beneficial Interest	$	161,234,616
Accumulated Net Investment Income		25,559
Accumulated Net Realized Gain From Investments		1,392,596
Net Unrealized Appreciation on Investments		19,355,546
Net Assets	$	182,008,317
Net Asset Value Per Share
Net Assets	$	182,008,317
Shares of Beneficial Interest Outstanding (no par value; unlimited shares authorized)		14,581,202
Net Asset Value and Repurchase Price per Share (a)	$	12.49
Offering Price per Share (Maximum sales charge of 4.50%)	$	13.07
(a) NAV is rounded

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

27 

Vertical Capital Income Fund

Statement of Operations

For the Year Ended September 30, 2016

Investment Income:
Interest Income	$	8,917,571
Total Investment Income		8,917,571
Expenses:
Investment Advisory Fees		2,119,196
Security Servicing Fees		771,641
Advisor Transition Expenses		348,297
Interest Expense		227,671
Transfer Agent Fees		181,502
Administration Fees		158,092
Insurance Expense		149,083
Legal Fees		123,373
Audit Fees		117,756
Line of Credit Fees		108,133
Non 12b-1 Shareholder Expense		104,162
Security Pricing Expense		103,237
Printing Expense		101,957
Custody Fees		95,250
Trustees’ Fees		65,232
Shareholder Servicing Fees		54,338
Fund Accounting Fees		49,026
Registration and Filing Fees		35,096
Chief Compliance Officer Fees		26,041
Miscellaneous Expenses		20,542
Total Expenses		4,959,625
Less: Expenses Waived by Adviser		(1,063,215	)
Net Expenses		3,896,410
Net Investment Income		5,021,161
Net Realized and Unrealized Gain on Investments:
Net Realized Gain on Investments		1,558,992
Net Change in Unrealized Appreciation on Investments		17,268,989
Net Realized and Unrealized Gain on Investments		18,827,981
Net Increase in Net Assets Resulting From Operations	$	23,849,142

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

28 

Vertical Capital Income Fund

Statements of Changes in Net Assets

	For the Year			For the Year
	Ended			Ended
	September 30, 2016			September 30, 2015
Operations:
Net Investment Income	$	5,021,161		$	5,088,866
Net Realized Gain on Investments		1,558,992			5,577,999
Net Change in Unrealized Appreciation on Investments		17,268,989			1,042,946
Net Increase in Net Assets
Resulting From Operations		23,849,142			11,709,811
Distributions to Shareholders From:
Net Investment Income ($0.38 and $0.44 per share, respectively)		(5,278,242	)		(5,481,291	)
Net Realized Gains ($0.35 and $0.04 per share, respectively)		(4,894,463	)		(496,914	)
Total Distributions to Shareholders		(10,172,705	)		(5,978,205	)
Beneficial Interest Transactions:
Proceeds from Shares Issued		36,900,456			63,006,549
Distributions Reinvested		5,848,424			3,206,422
Cost of Shares Redeemed		(34,799,498	)		(20,172,498	)
Total Beneficial Interest Transactions		7,949,382			46,040,473
Total Increase in Net Assets		21,625,819			51,772,079
Net Assets:
Beginning of Period		160,382,498			108,610,419
End of Period (including accumulated net investment  income (loss) of $25,559 and $(476,009), respectively)	$	182,008,317		$	160,382,498
Share Activity
Shares Issued		3,120,942			5,565,739
Shares Reinvested		483,421			283,130
Shares Redeemed		(2,937,959	)		(1,769,354	)
Net Increase in Shares of Beneficial Interest Outstanding		666,404			4,079,515

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

29 

Vertical Capital Income Fund

Statement of Cash Flows

For the Year Ended September 30, 2016

Increase (Decrease) in Cash
Cash Flows Provided by (Used for) Operating Activities:
Net Increase in Net Assets Resulting from Operations	$	23,849,142
Adjustments to Reconcile Net Increase in Net Assets Resulting from Operations to Net Cash Used for Operating Activities:
Purchases of Long-Term Portfolio Investments		(23,279,952	)
Proceeds from Sale of Long-Term Portfolio Investments and Principal Paydowns		22,088,772
Decrease in Interest Receivable		81,477
Decrease in Receivable for Securities Sold and Principal Paydowns		1,962,373
Decrease in Receivable for Fund Shares Sold		72,740
Increase in Prepaid Expenses and Other Assets		(526,963	)
Decrease in Accrued Advisory Fees		(153,216	)
Decrease in Shareholder Servicing Fees		(2,124	)
Decrease in Accrued Expenses and Other Liabilities		(253,211	)
Increase in Related Party Payable		26,234
Amortization of Deferred Financing Fees		108,133
Net Amortization on Investments		(1,422,126	)
Net Realized Gain on Investments		(1,558,992	)
Change in Unrealized Appreciation on Investments		(17,268,989	)
Net Cash Provided by Operating Activities		3,723,298
Cash Flows Provided by/Used for Financing Activities:
Deferred Financing Costs		(185,364	)
Proceeds from Sale of Shares		38,232,940
Redemption of Shares		(36,082,424	)
Dividends Paid to Shareholders, Net of Reinvestments		(4,324,281	)
Proceeds from Line of Credit		(13,521,750	)
Net Cash Provided by Financing Activities		(15,880,879	)
Net Increase in Cash		(12,157,581	)
Cash at Beginning of Period		20,495,037
Cash at End of Period	$	8,337,456

Supplemental Disclosure of Cash Flow Information:

Non-Cash Financing Activities Included Reinvestment of Distributions During the Fiscal Period of $5,848,424

Non-Cash Financing Activities Included Proceeds from Shares issued of $1,332,484

Non-Cash Financing Activities Included Cost of Shares Redeemed of $1,282,926

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

30 

Vertical Capital Income Fund

Financial Highlights

The table below sets forth financial data for one share of beneficial interest outstanding throughout each period presented.

	Year			Year			Year			Year			Period
	Ended			Ended			Ended			Ended			Ended
	September 30, 2016			September 30, 2015			September 30, 2014			September 30, 2013			September 30, 2012**
Net Asset Value, Beginning of Period	$	11.53		$	11.04		$	10.87		$	10.58		$	10.00
From Operations:
Net investment income (a)		0.36			0.41			0.51			0.50			0.33
Net gain from investments  (both realized and unrealized)		1.33			0.56			0.27			0.28			0.44
Total from operations		1.69			0.97			0.78			0.78			0.77
Distributions to shareholders from:
Net investment income		(0.38	)		(0.44	)		(0.56	)		(0.42	)		(0.19	)
Net realized gains		(0.35	)		(0.04	)		(0.05	)		(0.07	)		—
Total distributions		(0.73	)		(0.48	)		(0.61	)		(0.49	)		(0.19	)
Net Asset Value, End of Period	$	12.49		$	11.53		$	11.04		$	10.87		$	10.58
Total Return (b)		15.10	%		8.86	%		7.29	%		7.42	%		7.70	% (d)
Ratios/Supplemental Data
Net assets, end of period (in 000’s)	$	182,008		$	160,382		$	108,610		$	39,987		$	11,756
Ratio of gross expenses to average net assets		2.95	% (e)(f)		2.67	% (e)(f)		2.32	% (e)		3.20	%		9.42	% (c)
Ratio of net expenses to average net assets		2.26	% (e)(f)		2.33	% (e)(f)		1.91	% (e)		1.85	%		1.85	% (c)
Ratio of net investment income to average net assets		2.98	% (e)(f)		3.54	% (e)(f)		4.68	% (e)		4.61	%		4.21	% (c)
Portfolio turnover rate		13.72	%		2.58	%		8.37	%		11.68	%		1.50	% (d)

** The Fund commenced operations on December 30, 2011.

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

(b) Total returns are historical in nature and assume changes in share price, reinvestment of dividends and capital gains distributions, if any, and excludes the effect of sales charges. Had the Adviser not waived expenses, total returns would have been lower.

(c) Annualized.

(d) Not annualized.

(e) Ratio includes 0.20%, 0.27% and 0.06% for the years ended September 30, 2016, September 30, 2015 and September 30, 2014, respectively, that attributed to interest expenses and fees.

(f) Ratio includes 0.21% and 0.21% for the years ended September 30, 2016 and the year ended September 30, 2015, respectively, that attributed to adviser transition expenses.

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

31 

Vertical Capital Income Fund

Notes to Financial Statements

September 30, 2016

1. ORGANIZATION

Vertical Capital Income Fund (the “Fund”), was organized as a Delaware statutory trust on April 8, 2011 and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as a diversified, closed-end management investment company that operates as an interval fund with a continuous offering of Fund shares. The investment objective of the Fund is to seek income. The Fund commenced operations on December 30, 2011. The Fund currently offers shares at net asset value plus a maximum sales charge of 4.50%. Oakline Advisors, LLC, formerly known as Behringer Advisors, LLC (the “Advisor”) serves as the Fund’s investment adviser.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The Fund is an investment company and applies the specialized accounting and reporting guidance in the Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) Topic 946. The following is a summary of significant accounting policies and reporting policies used in preparing the financial statements. The accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”).

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses for the period. Actual results could differ from those estimates.

Security Valuation

Mortgage Notes – On October 13, 2015 the Fund began using an independent third-party pricing service, approved by the Fund’s Board of Trustees (“the Board”), to value its Mortgage Notes on a daily basis. The Fund had previously used the prior advisor’s proprietary model. The Fund’s NAV increased $0.76 per share upon conversion to the new pricing service on October 13, 2015. The revaluing of certain Mortgage Notes (see Note 3 for more detail) decreased the original October 13, 2015 value $0.42 per share. The third-party pricing servicer uses a cash flow forecast and valuation model that focuses on forecasting the frequency, timing and severity of mortgage loss behavior. The model incorporates numerous observable loan-level factors such as unpaid principal balance, remaining term of the loan and coupon rate as well as macroeconomic data including yield curves, spreads to the Treasury curves and home price indexes. The model also includes a number of unobservable factors and assumptions (such as voluntary and involuntary prepayment speeds, delinquency rates, foreclosure timing, and others) to determine a fair value. While the model requires a minimum set of data to develop a reasonable fair value, the model is capable of accepting additional data elements. The model makes certain assumptions unless a specific data element is included, in which case it uses the additional data. Not all assumptions have equal weighting in the model. Using assumptions in this manner is a part of the Fund’s valuation policy and procedures and provides consistency in the application of valuation assumptions. The third-party pricing servicer also benchmarks their pricing model against observable pricing levels being quoted by a range of market participants active in the purchase and sale of residential mortgage loans. The combination of loan level criteria and daily market adjustments produced a daily price for each Mortgage Note relative to current public market conditions.

Prior to purchase, each Mortgage Note goes through a due diligence process that includes considerations such as underwriting borrower credit, employment history, property valuation, and delinquency history with an overall emphasis on repayment of the Mortgage Notes. The purchase price of the Mortgage Notes reflects the overall risk relative to the findings of this due diligence process.

The Fund invests primarily in Mortgage Notes secured by residential real estate. The market or liquidation value of each type of residential real estate collateral may be adversely affected by numerous factors, including rising interest rates; changes in the national, state and local economic climate and real estate conditions; perceptions of

32 

Vertical Capital Income Fund

Notes to Financial Statements (Continued)

September 30, 2016

prospective buyers of the safety, convenience and attractiveness of the properties; maintenance and insurance costs; changes in real estate taxes and other expenses; adverse changes in governmental rules and fiscal policies; adverse changes in zoning laws; and other factors beyond the control of the borrowers.

The Fund’s investments in Mortgage Notes are subject to liquidity risk because there is a limited secondary market for Mortgage Notes. Liquidity risk exists when particular investments of the Fund would be difficult to purchase or sell, possibly preventing the Fund from selling such illiquid securities at an advantageous time or price, or possibly requiring the Fund to dispose of other investments at unfavorable times or prices in order to satisfy its obligations. Securities for which current market quotations are not readily available, such as the Mortgage Notes the Fund invests in, or for which quotations are not deemed to be representative of market values are valued at fair value as determined in good faith by or under the direction of the Board in accordance with the Trust’s Portfolio Securities Valuation Procedures (the “Procedures”). The Procedures consider, among others, the following factors to determine a security’s fair value: the nature and pricing history (if any) of the security; whether any dealer quotations for the security are available; and possible valuation methodologies that could be used to determine the fair value of the security.

The valuation inputs and subsequent outputs are reviewed and maintained on a daily basis. Any calibrations or adjustments to the model that may be necessary are done on an as-needed basis to facilitate fair pricing. Financial markets are monitored daily relative to the interest rate environment. If other available market data indicates that the pricing data from the third-party service is materially inaccurate, or pricing data is unavailable, the Fund undertakes a review of other available prices and takes additional steps to determine fair value. In all cases, the Fund validates its understanding of methodology and assumptions underlying the fair value used.

The Fund follows guidance in ASC 820, Fair Value Measurement, where fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between the market participants at the measurement date. The Fund utilizes various methods to measure the fair value of its investments on a recurring basis. Notwithstanding, the actual sale price of a Mortgage Note will likely be different than its fair value determined under ASC 820. GAAP establishes a hierarchy that prioritizes inputs to valuation methods. ASC 820 classifies the inputs used to measure these fair values into the following hierarchy:

Level 1 – Unadjusted quoted prices in active markets for identical and/or similar assets and liabilities that the Fund has the ability to access at the measurement date.

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

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

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

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

33 

Vertical Capital Income Fund

Notes to Financial Statements (Continued)

September 30, 2016

The inputs or methodology used for valuing investments are not necessarily an indication of the risk associated with investing in those investments. The following tables summarize the inputs used as of September 30, 2016 for the Fund’s assets measured at fair value:

Assets	Level 1		Level 2		Level 3		Total
Mortgage Notes	$	—	$	—	$	169,713,431	$	169,713,431
Other Investments		—		—		404,767	$	404,767
Total	$	—	$	—	$	170,118,198	$	170,118,198

There were no transfers between levels during the current period presented. It is the Fund’s policy to record transfers into or out of levels at the end of the reporting period.

The following is a reconciliation of assets in which Level 3 inputs were used in determining value:

	Mortgage Notes			Other Investments			Total
Beginning Balance	$	148,189,668		$	487,243		$	148,676,911
Net realized gain (loss)		1,535,546			23,446			1,558,992
Change in unrealized appreciation  (depreciation)		17,169,195			99,794			17,268,989
Cost of purchases		23,279,952			—			23,279,952
Proceeds from sales and principal paydow		(21,536,745	)		(552,027	)		(22,088,772	)
Amortization		1,408,454			13,672			1,422,126
Net Transfers within level 3		(332,639	)		332,639			—
Ending balance	$	169,713,431		$	404,767		$	170,118,198

The total change in unrealized appreciation (depreciation) included in the Statement of Operations attributable to Level 3 investments still held at September 30, 2016 is $17,268,989.

The following table provides quantitative information about the Fund’s Level 3 values, as well as its inputs, as of September 30, 2016. The table is not all-inclusive, but provides information on the significant Level 3 inputs.

						Weighted
					Range of	Average of
				Unobservable	Unobservable	Unobservable
	Value		Valuation Technique	Inputs	Inputs	Inputs
			Comprehensive
			pricing model with
			emphasis on
			discounted cash	Constant
Mortgage Notes	$	169,713,431	flows	prepayment rate	0-44.8%	13.90%
				Deliquency	0-3,104 days	36 days
				Loan-to-Value	3-300%	87.1%
Other Investments		404,767	Market comparable	Sales prices	$65-$150 sq/ft	$102 sq/ft
Closing Balance	$	170,118,198

A change to the unobservable input may result in a significant change to the value of the investment as follows:

34 

Vertical Capital Income Fund

Notes to Financial Statements (Continued)

September 30, 2016

Security Transactions and
Investment Income -	Impact to Value if	Impact to Value if
Investment Security	Input Increases	Input Decreases
Constant Prepayment Rate	Increase	Decrease
Delinquency	Decrease	Increase
Loan to Value	Decrease	Increase

Cash and Cash Equivalents – Cash and cash equivalents include cash and overnight investments in interest-bearing demand deposits with a financial institution with maturities of three months or less. The Fund maintains deposits with a high quality financial institution in an amount that is in excess of federally insured limits.

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

Interest Income on Non-Accrual Loans – The Fund discontinues the accrual of interest on loans when, in the opinion of management, there is an assessment that the borrower will likely be unable to meet all contractual payments as they become due.

Credit Facility – On February 5, 2013, the Fund entered into a revolving line of credit agreement with Sunwest Bank for investment purposes and to help maintain the Fund’s liquidity, subject to the limitations of the 1940 Act for borrowings. The maximum amount of borrowing allowed under the agreement was the lesser of $15 million or 33% of the eligible portion of the Fund’s loans. On February 5, 2016, the original maturity date, the agreement was amended to extend the maturity date to May 5, 2016 and waive any event of default. The Fund entered into the Amended and Restated Credit Agreement (“Amended Agreement”) on June 29, 2016. Borrowings under the Amended Agreement continue to bear interest at a rate equal to the Wall Street Journal Prime, with a floor rate of 3.50%, per annum, on the outstanding principal balance and the maximum amount of borrowing allowed continues to be the lesser of $15 million or 33% of the eligible portion of the Fund’s loans. The Amended Agreement matures on January 5, 2018. The Fund incurred deferred financing fees of $185,364 as a result of the Amended Agreement. Accumulated amortization of deferred financing fees was $108,133 as of September 30, 2016. During the year ended September 30, 2016, the Fund utilized the line of credit. The average amount of borrowing outstanding for the period was $8,555,192 and the total interest expense was $227,671. As of September 30, 2016, there were no borrowings outstanding under the line of credit. The outstanding balance under the line of credit was $15,000,000 at March 10, 2017.

Federal Income Taxes – The Fund intends to continue to comply with the requirements of Subchapter M of the Internal Revenue Code applicable to regulated investment companies and will distribute all of its taxable income, if any, to shareholders. Accordingly, no provision for Federal income taxes is required in the financial statements.

The Fund recognizes the tax benefits of uncertain tax positions only where the position is “more likely than not” to be sustained assuming examination by tax authorities. Management has analyzed the Fund’s tax positions, and has concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions taken by the Fund in its 2013 - 2015 tax returns or expected to be taken in the Fund’s 2016 tax returns. The Fund identified its major tax jurisdictions as U.S. Federal jurisdictions where the Fund makes significant investments; however, the Fund is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next twelve months.

Distributions to Shareholders – Distributions from investment income, if any, are declared and paid monthly and are recorded on the ex-dividend date. The Fund will declare and pay net realized capital gains not previously distributed, if any, annually. The character of income and gains to be distributed is determined in accordance with Federal

35 

Vertical Capital Income Fund

Notes to Financial Statements (Continued)

September 30, 2016

income tax regulations, which may differ from GAAP. These “book/tax” differences are considered either temporary (i.e., deferred losses, capital loss carry forwards) or permanent in nature. To the extent these differences are permanent in nature, such amounts are reclassified within the composition of net assets based on their federal tax-basis treatment; temporary differences do not require classification.

Indemnification – The Trust indemnifies its officers and Trustees for certain liabilities that may arise from the performance of their duties to the Trust. Additionally, in the normal course of business, the Fund enters into contracts that contain a variety of representations and warranties and which provide general indemnities. 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. However, management of the Fund expects the risk of loss due to these warranties and indemnities to be remote.

3. REPRICING OF CERTAIN MORTGAGE NOTES

As noted above, the Fund began using an independent third-party valuation service on October 13, 2015 which, in general, priced all of the Fund’s Mortgage Notes on a daily basis. However, there were two general exceptions. One related to loans having a portion of their unpaid principle balance deferred to maturity (“deferred balance”), and the other related to loans that had provisions for contractual increases in future interest rates (“step rates”). Both of these situations typically resulted from prior loan modifications.

In the case of loans with deferred balance features, the Fund used several procedures during the year. For the period October 1, 2015 through October 12, 2015, the Fund employed the prior advisor’s proprietary model in a manner consistent with historical practice. For the period October 13, 2015 (when the Fund’s current valuation service’s model was first deployed) through September 23, 2016, the Fund’s Administrator applied certain pricing information obtained from the Fund’s valuation service to the amount of deferred balances that it maintained on the Fund’s books.

During the course of working with the Fund’s valuation service to include the pricing of the deferred balances in their model, the Fund determined that some information relating to step rate loans was not being considered in determining the fair value of the Mortgage Notes. When discovered, management sought to have such information additionally included in the valuation servicer’s model. This occurred simultaneously on September 26, 2016 with the inclusion of the deferred balance information, after such step rate loan information was also validated.

As a result of the change in the valuation process, the Fund reported a decrease in its NAV of $0.31 per share on September 26, 2016. Since the change was viewed as material, the Board determined that the Fund should revalue its Mortgage Notes for the period of October 13, 2015 through September 23, 2016 using revised pricing obtained from the Fund’s valuation service. After repricing, it was determined that the Fund’s daily NAV (and NAV per share) were overstated during this period.

As a result, the Fund will reprocess certain shareholder transactions that occurred during this period and has calculated the amounts, if any, due to, or from, the Fund or such shareholders as of September 30, 2016 (see Note 6).

4. INVESTMENT IN RESTRICTED SECURITIES

Notes secured by a mortgage or deed of trust held by the Fund (“Restricted Securities”), while exempt from registration under the Securities Act of 1933 (the “1933 Act”), are subject to certain restrictions on resale and cannot be sold publicly. The Fund may invest in Restricted Securities that are consistent with the Fund’s investment objectives and investment strategies. Investments in Restricted Securities are valued at fair value as determined in

36 

Vertical Capital Income Fund

Notes to Financial Statements (Continued)

September 30, 2016

good faith in accordance with procedures adopted by the Board of Trustees. The Fund has no rights to compel the obligor or issuer of a Restricted Security to register such a Restricted Security under the 1933 Act.

5. ADVISORY FEE AND OTHER RELATED PARTY TRANSACTIONS

The business activities of the Fund are overseen by the Board, which is responsible for the overall management of the Fund.

Advisory Fees – Pursuant to an Advisory Agreement with the Fund, the Advisor, under the oversight of the Board, directs certain of the daily operations of the Fund and supervises the performance of administrative and professional services provided by others. As compensation for its services and the related expenses borne by the Advisor, the Fund pays the adviser a management fee, computed and accrued daily and paid monthly, at an annual rate of 1.25% of the average daily net assets of the Fund. For the year ended September 30, 2016, the Advisor earned advisory fees of $2,119,196.

The Advisor has contractually agreed to waive all or part of its management fees and/or make payments to limit Fund expenses (exclusive of any front-end or contingent deferred loads, taxes, leverage interest, brokerage commissions, expenses incurred in connection with any merger or reorganization, expenses of investing in underlying funds, or extraordinary expenses such as litigation) at least until January 31, 2018, so that the total annual operating expenses of the Fund do not exceed 1.85% of the average daily net assets of the Fund. The Fund incurred extraordinary expenses totaling $348,297 during the year ended September 30, 2016 associated with the transition to the new Advisor. These extraordinary transition expenses are not subject to the operating expense limitation. Waivers and expense reimbursements may be recouped by the Advisor from the Fund, to the extent that overall expenses fall below the expense limitation, within three years of when the amounts were waived. For the year ended September 30, 2016, the Advisor waived advisory fees of $1,063,215. Expenses subject to recapture by the Advisor amounted to $178,366 that will expire on September 30, 2018 and $1,063,215 that will expire on September 30, 2019.

Distributor – The distributor of the Fund is Northern Lights Distributors, LLC (the “Distributor”). The Board of Trustees of the Fund has adopted, on behalf of the Fund, a Shareholder Servicing Plan to pay for certain shareholder services. Under the Plan, the Fund will pay 0.03% per year of its average daily net assets for such shareholder service activities. The Fund does not pay shareholder servicing fees to the Distributor. For the year ended September 30, 2016, the Fund incurred shareholder servicing fees of $54,338.

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

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

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

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

37 

Vertical Capital Income Fund

Notes to Financial Statements (Continued)

September 30, 2016

Security Servicing Agent – The Fund pays Statebridge Company, LLC (“Statebridge”), an unaffiliated third party, a fee for the collections from and maintenance of its securities by providing services such as contacting delinquent borrowers and managing the foreclosure process or other recovery processes for the Fund in the event of a borrower’s default.

Trustees – The Fund pays each Trustee who is not affiliated with the Fund or advisor a quarterly fee of $5,000, as well as reimbursement for any reasonable expenses incurred attending meetings. Additionally, beginning November 11, 2016, each unaffiliated Trustee will receive $2,500 per meeting and the lead unaffiliated Trustee will receive an additional $10,000 per year. The “interested persons” who serve as Trustees of the Fund receive no compensation for their services as Trustees. None of the executive officers receive compensation from the Fund.

6. RECEIVABLE FROM ADVISOR/PAYABLE TO SHAREHOLDERS

As a result of the recalculation of the Fund’s NAV (and NAV per share) for the period October 13, 2015 to September 23, 2016 as described in Note 3, the Fund has recorded certain adjustments to its financial position as of September 30, 2016. For shareholders who had a portion of their shares redeemed and are still shareholders, and for shareholders who acquired shares and are still shareholders; their remaining share counts will be decreased or increased to reflect the Fund’s revised NAV per share on the dates of their transactions.

As of September 30, 2016 the over payment to redeemed shareholders totaling $1,242,366 has been recorded as a receivable from the Advisor of which a portion is expected to be recovered through the reprocessing of shareholder transactions, and the under-issued shares to acquiring shareholders totaling $1,332,484 has been recorded as a payable to shareholders; with offsetting entries to the Fund’s paid-in-beneficial interests.

The Fund has also recorded a receivable from the Advisor in the amount of $40,560 reflecting the amount the Advisor has agreed to pay the Fund as a reimbursement for over payments of asset-based fees including advisory fees and interest on the reimbursement amounts.

7. INVESTMENT TRANSACTIONS

The cost of purchases and proceeds from sales and paydowns of securities, other than U.S. Government securities and short-term investments, for the year ended September 30, 2016 amounted to $23,279,952 and $22,088,772 respectively.

8. REPURCHASE OFFERS

Pursuant to Rule 23c-3 under the Investment Company Act of 1940, as amended, the Fund offers shareholders on a quarterly basis the option of redeeming shares, at net asset value, of no less than 5% and no more than 25% of the shares outstanding. There is no guarantee that shareholders will be able to sell all of the shares they desire in a quarterly repurchase offer, although each shareholder will have the right to require the Fund to purchase up to and including 5% of such shareholder’s shares in each quarterly repurchase. Limited liquidity will be provided to shareholders only through the Fund’s quarterly repurchases.

During the year ended September 30, 2016, the Fund completed four quarterly repurchase offers. In those offers, the Fund offered to repurchase up to 5% (and an additional 2% at the Fund’s discretion) of the number of its outstanding shares as of the Repurchase Pricing Dates. The results of those repurchase offers were as follows:

38 

Vertical Capital Income Fund

Notes to Financial Statements (Continued)

September 30, 2016

	Repurchase			Repurchase			Repurchase			Repurchase
	Offer #1			Offer #2			Offer #3			Offer #4
Commencement Date		09/11/15			12/15/15			03/21/16			06/15/16
Repurchase Request Deadline		10/16/15			01/20/16			04/22/16			07/21/16
Repurchase Pricing Date		10/16/15			01/20/16			04/22/16			07/21/16
Net Asset Value as of Repurchase Pricing Date	$	12.35		$	12.06		$	12.26		$	12.46
Amount Repurchased	$	8,668,005		$	8,898,952		$	9,296,040		$	9,219,427
Percentage of Outstanding Share Repurchased		5.00	%		5.00	%		5.00	%		5.00	%

The following repurchases offer occurred subsequent to the reporting period:

		Repurchase Offer			Repurchase Offer
Commencement Date		09/12/16			12/13/2016
Repurchase Request Deadline		10/17/16			1/20/2017
Repurchase Pricing Date		10/17/16			1/20/2017
Net Asset Value as of Repurchase Pricing Date	$	12.50		$	12.37
Amount Repurchased	$	9,257,348		$	9,000,244
Percentage of Outstanding Share Repurchased		5.00	%		5.00	%

9. DISTRIBUTIONS TO SHAREHOLDERS AND TAX COMPONENTS OF CAPITAL

The tax character of distributions paid during the fiscal years ended September 30, 2016 and September 30, 2015 was as follows:

	Fiscal Year Ended		Fiscal Year Ended
	September 30, 2016		September 30, 2015
Ordinary Income	$	5,780,415	$	5,734,414
Long-Term Capital Gain		4,392,290		243,791
	$	10,172,705	$	5,978,205

As of September 30, 2016, the components of accumulated earnings/ (deficit) on a tax basis were as follows:

Undistributed		Undistributed		Post October Loss		Capital Loss		Other			Unrealized		Total
Ordinary		Long-Term		and		Carry		Book/Tax			Appreciation/		Accumulated
Income		Gains		Late Year Loss		Forwards		Differences			(Depreciation)		Earnings/(Deficits)
$	558,522	$	893,855	$	—	$	—	$	(34,222	)	$	19,355,546	$	20,773,701

The amount listed under other book/tax differences for the Fund is primarily attributable to tax adjustments for defaulted notes.

39 

Vertical Capital Income Fund

Notes to Financial Statements (Continued)

September 30, 2016

Permanent book and tax differences, primarily attributable to the reclassification of Fund distributions and tax adjustments for defaulted notes, resulted in reclassification for the year ended September 30, 2016 as follows:

Paid		Undistributed		Accumulated
In		Net Investment		Net Realized
Capital		Income (Loss)		Gains (Loss)
$	—	$	282,640	$	(282,640	)

10. SUBSEQUENT EVENTS

The Fund is required to recognize in the financial statements the effects of all subsequent events that provide additional evidence about conditions that existed at the date of the Statement of Assets and Liabilities. For non-recognized subsequent events that must be disclosed to keep the financial statements from being misleading, the Fund is required to disclose the nature of the event as well as an estimate of its financial effect, or a statement that such an estimate cannot be made. Management has determined that other than those disclosed in these financial statements, there were no other subsequent events to report through the issuance of these financial statements.

40 

Report of Independent Registered Public Accounting Firm

The Board of Trustees and Shareholders of

Vertical Capital Income Fund:

We have audited the accompanying statement of assets and liabilities of Vertical Capital Income Fund (the Fund), including the portfolio of investments, as of September 30, 2016, and the related statements of operations and cash flows for the year then ended, the statements of changes in net assets and the financial highlights for each of the years in the two-year period then ended. These financial statements and financial highlights are the responsibility of the Fund’s management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. The accompanying financials highlights for each of the years in the two-year period ended September 30, 2014, and for the period December 30, 2011 (commencement of operations) through September 30, 2012 of Vertical Capital Income Fund were audited by other auditors whose report thereon dated November 28, 2014, expressed an unqualified opinion on those statements.

We conducted our audits 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 and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of September 30, 2016, by correspondence with the custodian. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of Vertical Capital Income Fund as of September 30, 2016, the results of its operations and its cash flows for the year then ended, the changes in its net assets and financial highlights for each of the years in the two-year period then ended, in conformity with U.S. generally accepted accounting principles. 

/s/KPMG LLP

Dallas, Texas

March 21, 2017

41 

Supplemental Information (Unaudited)

FACTORS CONSIDERED BY THE INDEPENDENT TRUSTEES IN APPROVAL OF THE INVESTMENT ADVISORY AGREEMENT*

The Investment Advisory Agreement (“New Agreement”) was approved by a majority of the Board, including the Independent Trustees, at an in-person meeting held on June 29, 2015. The Board reviewed the materials provided by the Advisor: Oakline Advisors, LLC (formerly known as Behringer Advisors, LLC) in advance of the meeting. The Trustees were assisted by independent legal counsel throughout the New Agreement review process. The Board relied upon the advice of independent legal counsel and their own business judgment in determining the material factors to be considered in evaluating the New Agreement and the weight to be given to each such factor. The conclusions reached by the Trustees were based on a comprehensive evaluation of all of the information provided and were not the result of any one factor. Moreover, each Trustee may have afforded different weight to the various factors in reaching his conclusions with respect to the New Agreement.

Nature, Extent and Quality of Services. The Trustees discussed the Advisor’s history and portfolio management experience. They noted that the Advisor and its affiliates currently serves a variety of retail, registered investment advisers and institutional investor clients, managing approximately $787 million in assets across its non-listed real estate investment trust (“REIT”), closed end funds and DST/Net Lease platform (a real estate related investment vehicle). The Trustees reviewed the background and experience of the Advisor’s team proposed to advise and service the Fund. They noted that although the Advisor had not provided advisory services to a registered investment company directly, they considered the varied and extensive experience of the portfolio management and compliance teams, and the Advisor’s ability to leverage the experience and expertise of its affiliates to the benefit of the Fund and shareholders. The Trustees discussed the investment advisory and related services to be provided to the Fund noting that the Advisor would oversee the day-to-day operations of the Fund, provide a variety of investment advisory services including execution and management of the Fund’s investment portfolio, and provide oversight and compliance. They considered that although the Advisor does not have experience in the residential mortgage markets, it does have previous experience with REIT and real-estate related investments. The Trustees noted positively the significant support the Advisor has in the Advisor-affiliated entities which further strengthen the services available to the Fund and shareholders. The Trustees discussed the Advisor’s proposal for the ongoing management and implementation of strategy changes for the Fund over time, and agreed that it had given thoughtful consideration to the development of a strategic and promising plan for the Fund. After further discussion, the Trustees concluded that the Advisor has the potential to provide advisory services to the Fund in line with the Board’s expectations.

Performance. The Trustees reviewed the performance of a variety of accounts currently managed by the Advisor. They noted that the Advisor does not currently manage a fund with a strategy substantially similar to that of the Fund, so the performance information provided was merely illustrative of the Advisor’s general capabilities. They also reviewed the performance of multiple REITs managed by the Advisor noting the positive returns in each period shown. The Trustees considered that while the Advisor does not have experience in the residential mortgage market, its experience and successful track record in the commercial real-estate and REIT markets suggest it has the capacity to provide positive returns for shareholders.

Fees and Expenses. The Trustees noted that the Advisor proposed to charge an advisory fee of 1.25%, equal to that currently paid by the Fund. They considered that the proposed fee was higher than the Morningstar category of real estate related funds average but within the range of fees of the peer group. The Trustees noted that Morningstar does not have a closed-end interval fund category and, therefore, the Morningstar comparison, while informative is not directly on point as to the relative reasonableness of the proposed fee. The Trustees further considered that the Advisor would maintain a contractual fee waiver until January 31, 2017 limiting the Fund’s total expense ratio to 1.85%. After further discussion, the Trustees concluded that the proposed advisory fee was reasonable.

42 

Profitability. The Trustees reviewed a profitability analysis provided by the Advisor, and discussed the Advisor’s estimated profitability in connection with its relationship with the Fund. They noted that the Advisor anticipates realizing a net profit during the initial term of the New Agreement but agreed that the amount of profit was not excessive in terms of actual dollars or as a percentage of revenue. The Trustees further noted that the Advisor had agreed, if shareholders approve the New Agreement, to pay a portion of an existing shortfall in the Fund’s mortgage loan servicing account. They considered that the Advisor’s profitability analysis did not take this expense into account, and if it had, the Advisor would realize a net loss in connection with its relationship with the Fund for the first year. After further discussion, the Trustees concluded the Advisor’s estimated profitability was reasonable.

Economies of Scale. The Trustees considered whether there will be economies of scale with respect to the management of the Fund. The Trustees noted the absence of breakpoints in the Advisor’s fee proposal. They considered the Advisor’s representation that the Fund could benefit from economies as certain expenses of the Fund will be leveraged across the Advisor’s shared services platform and firm resources. After further discussion, the Trustees agreed that the matter of economies of scale would be revisited in connection with the renewal of the New Agreement as the Advisor’s costs are more clearly identified and prospects for Fund growth are better understood.

Conclusion. Having requested and received such information from the Advisor as the Trustees believed to be reasonably necessary to evaluate the terms of the New Agreement, and as assisted by the advice of Counsel, the Trustees concluded that the fee structure is reasonable and that approval of the New Agreement is in the best interests of the shareholders of Vertical Capital Income Fund.

PROXY VOTE

At a Special Meeting of Shareholders of the Fund, held at the offices of Gemini Fund Services, LLC, 80 Arkay Drive, Suite 110, Hauppauge, NY 11788, on Friday, October 30, 2015, shareholders of record as of the close of business on September 4, 2015 voted to approve the following proposal:

Proposal 1: To Elect a new Trustee

Shares Voted	Shares Voted Against
In Favor	or Abstentions
12,293,980	878,966

At a Special Meeting of Shareholders of the Fund, held at the offices of Gemini Fund Services, LLC, 80 Arkay Drive, Suite 110, Hauppauge, NY 11788, on Monday, November 16, 2015, shareholders of record as of the close of business on September 4, 2015 voted to approve the following proposal:

Proposal: To approve a new investment Advisory Agreement between the Fund and Behringer Advisors, LLC.

Shares Voted	Shares Voted Against
In Favor	or Abstentions
6,909,137	255,810

* Due to timing of the contract renewal schedule, these deliberations may or may not relate to the current performance results of the Fund.

43 

Vertical Capital Income Fund

Supplemental Information (Continued)

September 30, 2016 (Unaudited)

Following is a list of the Trustees and executive officers of the Trust and their principal occupation over the last five years. Unless otherwise noted, the address of each Trustee and Officer is 80 Arkay Drive, Hauppauge, NY 11788.

Independent Trustees
Name (Year of Birth)	Number of
Position held with the Fund*	Portfolios in Fund
Principal Occupations and Other Directorships During Past 5 Years	Complex Overseen
	by Trustee**
Robert J. Boulware (1956) Trustee, since August 2011 Managing Director, Pilgrim Funds, LLC (private equity fund), Sept. 2006 to present. Other Directorships: Trustee, Met Investors Series Trust (48 portfolios), March 2008 to present; Metropolitan Series Funds (30 portfolios) April 2012 to Present; Director, Gainsco Inc. (auto insurance) May 2005 to present, Trustee, Sharespost 100 Fund, March 2013 to Present.	1
Mark J. Schlafly (1961) Trustee, since August 2011 Managing Director, Russell Investments, June 2013 to January 2015; Staff Member, Weston Center, Washington University, August 2011 to present; Other Directorships: None	1
T. Neil Bathon (1961) Trustee, since August 2011 Managing Partner, FUSE Research Network, LLC, Aug. 2008 to present; Managing Director, PMR Associates LLC (consulting firm), July 2006 to Present; Other Directorships: BNY Mellon Chartable Gift Fund, July 2013 to Present	1

44 

Vertical Capital Income Fund

Supplemental Information (Continued)

September 30, 2016 (Unaudited)

Interested Trustees and Officers
Name (Year of Birth)	Number of
Position held with the Fund*	Portfolios in Fund
Principal Occupations and Other Directorships During Past 5 Years	Complex Overseen by Trustee**
Robert J. Chapman *** (1947) Trustee, since August 2015 Executive Vice President, Oakline Advisors, LLC (investment adviser), a position held since July 2015. Executive Vice President, Stratera Holdings, LLC (financial services holding company) a position held since 2007. Other Directorships: None	1
Michael D. Cohen (1974) President, since July 2015 Chief Executive Officer, Stratera Holdings, LLC, (financial services holding company), a position held since October 2016, President of Stratera Holdings, LLC, a position held since April 2015; Executive Vice President, Jan. 2013 to Apr. 2015. President of Stratera Services, LLC, Apr. 2015 to present; Executive Vice President, Jan. 2011 to Apr. 2015. Similar positions held at subsidiaries of Stratera Holdings. Executive Vice President of Pathway Energy Infrastructure Management, LLC, Aug. 2014 to present. Director, Behringer Harvard Opportunity REIT I, Inc., July 2014 to present. Director, Behringer Harvard Opportunity REIT II, Inc., Feb. 2013 to present. Executive Vice President, Pathway Energy Infrastructure Fund, LLC, Feb 2013 to present. Executive Vice President of Priority Senior Secured Income Management, LLC, Oct. 2012 to present. Executive Vice President of Priority Income Fund, Inc., July 2012 to present. Other Directorships: N/A	N/A
Jason Hall (1966) Treasurer, since July 2015 Senior VP, Chief Financial Officer, Chief Accounting Officer and Treasurer, Behringer Harvard Opportunity REIT II Inc., positions held since Oct. 2014; Senior VP, Chief Accounting Officer, Treasurer, Sept. 2013 to Oct. 2014;Treasurer, Director of Financial Reporting, Senior Fund Controller, Jan 2012 to Sept. 2013, Director of Financial Reporting, Senior Fund Controller, Behringer Harvard Holdings, LLC (financial services holding company), Jan. 2011 to Dec. 2011. Other Directorships: N/A	N/A
Harris Cohen (1981) Assistant Treasurer since 2011 Assistant Vice President of Fund Administration (2016-Present); Manager of Fund Administration (2011-2016); Senior Fund Administrator (2005-2011), Gemini Fund Services, LLC. Other Directorships: N/A	N/A
Stanton P. Eigenbrodt (1965) Secretary since July 2015 Executive Vice President of Oakline Advisors, a position held since July 2015. Chief Legal Officer of Statera Holdings, LLC (financial services holding company) a position held since 2015; Executive Vice President and General Counsel (2011-2015); Senior Vice President and General Counsel (2006-2011). Similar positions held at subsidiaries of Stratera Holdings, LLC. Other Directorships: N/A	N/A
Emile R. Molineaux (1962) Chief Compliance Officer and Anti-Money Laundering Officer Since August 2011 Northern Lights Compliance Services, LLC (Secretary since 2003 and Senior Compliance Officer since 2011); General Counsel, CCO and Senior Vice President, Gemini Fund Services, LLC; Secretary and CCO, Northern Lights Compliance Services, LLC (2003-2011). Other Directorships: N/A	N/A

* The term of office for each Trustee listed above will continue indefinitely and officers listed above serve subject to annual reappointment.

** The term “Fund Complex” refers to the Vertical Capital Income Fund.

*** Mr. Chapman is an interested Trustee because he is also an officer of the Fund’s investment adviser.

The Fund’s Statement of Additional Information includes additional information about the Trustees and is available free of charge, upon request, by calling toll-free at 1-866-277-VCIF.

45 

PRIVACY NOTICE

Rev. May 2012

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

Reasons we can share your personal information	Does Vertical Capital Income Fund share?	Can you limit this sharing?
For our everyday business purposes – such as to process your transactions, maintain your account(s), respond to court orders and legal investigations, or report to credit bureaus	Yes	No
For our marketing purposes – to offer our products and services to you	No	We don’t share
For joint marketing with other financial companies	No	We don’t share
For our affiliates’ everyday business purposes – information about your transactions and experiences	No	We don’t share
For our affiliates’ everyday business purposes – information about your creditworthiness	No	We don’t share
For nonaffiliates to market to you	No	We don’t share

Questions?        Call 1-866-277-VCIF

46 

Rev. May 2012

Who we are
Who is providing this notice?	Vertical Capital Income Fund
What we do
How does Vertical Capital Income Fund protect my personal information?	To protect your personal information from unauthorized access and use, we use security measures that comply with federal law. These measures include computer safeguards and secured files and buildings. Our service providers are held accountable for adhering to strict policies and procedures to prevent any misuse of your nonpublic personal information.
How does Vertical Capital Income Fund collect my personal information?	We collect your personal information, for example, when you ■    Open an account ■    Provide account information ■    Give us your contact information ■    Make deposits or withdrawals from your account ■    Make a wire transfer ■    Tell us where to send the money ■    Tells us who receives the money ■    Show your government-issued ID ■    Show your driver’s license We also collect your personal information from other companies.
Why can’t I limit all sharing?	Federal law gives you the right to limit only ■     Sharing for affiliates’ everyday business purposes – information about your creditworthiness ■      Affiliates from using your information to market to you ■      Sharing for nonaffiliates to market to you State laws and individual companies may give you additional rights to limit sharing.
Definitions
Affiliates	Companies related by common ownership or control. They can be financial and nonfinancial companies. ■    Vertical Capital Income Fund does not share with our affiliates.
Nonaffiliates	Companies not related by common ownership or control. They can be financial and nonfinancial companies ■    Vertical Capital Income Fund does not share with nonaffiliates so they can market to you.
Joint marketing	A formal agreement between nonaffiliated financial companies that together market financial products or services to you. ■    Vertical Capital Income Fund doesn’t jointly market.

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How to Obtain Proxy Voting Information

Information regarding how the Fund votes proxies relating to portfolio securities for the 12 month period ended June 30th as well as a description of the policies and procedures that the Fund used to determine how to vote proxies is available without charge, upon request, by calling 1-866-277-VCIF by referring to the Securities and Exchange Commission’s (“SEC”) website at http://www.sec.gov.

How to Obtain 1st and 3rd Fiscal Quarter Portfolio Holdings

The Fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. Form N-Q is 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 (1-800-SEC-0330). The information on Form N-Q is available without charge, upon request, by calling 1-866-277-VCIF.

Investment Adviser

Oakline Advisors, LLC

15601 Dallas Parkway, Suite 600

Addison, Texas 75001

Administrator

Gemini Fund Services, LLC

80 Arkay Drive

Hauppauge, NY 11788

Item 2. Code of Ethics.

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

(b)        For purposes of this item, “code of ethics” means written standards that are reasonably designed to deter wrongdoing and to promote:

(1) Honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships;

(2) Full, fair, accurate, timely, and understandable disclosure in reports and documents that a registrant files with, or submits to, the Commission and in other public communications made by the registrant;

(3)        Compliance with applicable governmental laws, rules, and regulations;

(4) The prompt internal reporting of violations of the code to an appropriate person or persons identified in the code; and

(5)        Accountability for adherence to the code.

(c)        Amendments: During the period covered by the report, there have not been any amendments to the provisions of the code of ethics.

(d)        Waivers: During the period covered by the report, the registrant has not granted any express or implicit waivers from the provisions of the code of ethics.

Item 3. Audit Committee Financial Expert.

The registrant’s board of trustees has determined that the registrant does not have an audit committee financial expert serving on its audit committee.

Item 4. Principal Accountant Fees and Services

(a) Audit Fees

Registrant Advisor

FYE 09/30/16      $141,500    N/A

FYE 09/30/15      $130,193    N/A

(b) Audit-Related Fees

Registrant Advisor

FYE 09/30/16          $0      N/A

FYE 09/30/15          $0      N/A

(c) Tax Fees

Registrant Advisor

FYE 09/30/16          $0        N/A

FYE 09/30/15          $0        N/A

Preparation of Federal & State income tax returns, assistance with calculation of required income, capital gain and excise distributions and preparation of Federal excise tax returns.

(d) All Other Fees

Registrant Advisor

FYE 09/30/16          $0         N/A

FYE 09/30/15          $0         N/A

(e) (1) Audit Committee’s Pre-Approval Policies

The registrant’s Audit Committee is required to pre-approve all audit services and, when appropriate, any non-audit services (including audit-related, tax and all other services) to the registrant. The registrant’s Audit Committee also is required to pre-approve, when appropriate, any non-audit services (including audit-related, tax and all other services) to its adviser, or any entity controlling, controlled by or under common control with the adviser that provides ongoing services to the registrant, to the extent that the services may be determined to have an impact on the operations or financial reporting of the registrant. Services are reviewed on an engagement by engagement basis by the Audit Committee.

(2) Percentages of Services Approved by the Audit Committee

Registrant Advisor

Audit-Related Fees:         N/A      N/A

Tax Fees:                        N/A     N/A

All Other Fees:                N/A      N/A

(f) During the audit of registrant's financial statements for the most recent fiscal year, less than 50 percent of the hours expended on the principal accountant's engagement were attributed to work performed by persons other than the principal accountant's full-time, permanent employees.

(g) The aggregate non-audit fees billed by the registrant's accountant for services rendered to the registrant, and rendered to the registrant's investment adviser (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser), and any entity controlling, controlled by, or under common control with the adviser that provides ongoing services to the registrant:

Registrant Advisor

FYE 09/30/2016            $0         N/A

FYE 09/30/2015            $0         N/A

(h)        The registrant's audit committee has considered whether the provision of non-audit services 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 Companies. Not applicable.

Item 6. Schedule of Investments. See Item 1.

Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Funds.

Pursuant to the adoption by the Securities and Exchange Commission (the “Commission”) of Rule 206(4)-6 (17 CFR 275.206(4)-6) and amendments to Rule 204-2 (17 CFR 275.204-2) under the Investment Adviser Act of 1940 (the “Act”), it is a fraudulent, deceptive, or manipulative act, practice or course of business, within the meaning of Section 206(4) of the Act, for an investment adviser to exercise voting authority with respect to client securities, unless (i) the adviser has adopted and implemented written policies and procedures that are reasonably designed to ensure that the adviser votes proxies in the best interests of its clients, (ii) the adviser describes its proxy voting procedures to its clients and provides copies on request, and (iii) the adviser discloses to clients how they may obtain information on how the adviser voted their proxies.

In order to fulfill its responsibilities under the Act, Vertical Capital Asset Management, LLC (hereinafter, “we” or “our”) has adopted the following policies and procedures for proxy voting with regard to direct investments in companies held in investment portfolios of our clients.

KEY OBJECTIVES

The key objectives of these policies and procedures recognize that a company’s management is entrusted with the day-to-day operations and longer term strategic planning of the company, subject to the oversight of the company’s board of directors. While “ordinary business matters” are primarily the responsibility of management and should be approved solely by the corporation’s board of directors, these objectives also recognize that the company’s shareholders must have final say over how management and directors are performing, and how shareholders’ rights and ownership interests are handled, especially when matters could have substantial economic implications to the shareholders.

Therefore, we will pay particular attention to the following matters in exercising our proxy voting responsibilities as a fiduciary for our clients:

Accountability. Each company should have effective means in place to hold those entrusted with running a company’s business accountable for their actions. Management of a company should be accountable to its board of directors and the board should be accountable to shareholders.

Alignment of Management and Shareholder Interests. Each company should endeavor to align the interests of management and the board of directors with the interests of the company’s shareholders. For example, we generally believe that compensation should be designed to reward management for doing a good job of creating value for the shareholders of the company.

Transparency. Promotion of timely disclosure of important information about a company’s business operations and financial performance enables investors to evaluate the performance of a company and to make informed decisions about the purchase and sale of a company’s securities.

DECISION METHODS

We generally believe that portfolio managers that invest in and track particular companies have a unique perspective to make decisions with regard to proxy votes. Therefore, we rely on that perspective to make the final decisions on how to cast proxy votes.

No set of proxy voting guidelines can anticipate all situations that may arise. In special cases, we may seek insight and expertise from outside sources as to how a particular proxy proposal will impact the financial prospects of a company, and vote accordingly.

In some instances, a proxy vote may present a conflict between the interests of a client, on the one hand, and our interests or the interests of a person affiliated with us, on the other. In such a case, we will abstain from making a voting decision and will forward all of the necessary proxy voting materials to the client to enable the client to cast the votes.

SUMMARY OF PROXY VOTING GUIDELINES

Election of the Board of Directors

We believe that good corporate governance generally starts with a board composed primarily of independent directors, unfettered by significant ties to management, all of whose members are elected annually. We also believe that some measure of turnover in board composition typically promotes more independent board action and fresh perspectives on governance. Of greater importance is the skill set of the proposed board member. We will also look at the backgrounds of the directors to gauge their business acumen and any special talent or experience that may add value to their participation on the board.

The election of a company’s board of directors is one of the most fundamental rights held by shareholders. Because a classified board structure prevents shareholders from electing a full slate of directors annually, we will pay special attention to efforts to declassify boards or other measures that permit shareholders to remove a majority of directors at any time.

Approval of Independent Auditors

We believe that the relationship between a company and its auditors should be limited primarily to the audit engagement, although it may include certain closely related activities that do not raise an appearance of impaired independence.

We will evaluate on a case-by-case basis instances in which the audit firm has a substantial non-audit relationship with a company to determine whether we believe independence has been, or could be, compromised.

Equity-based compensation plans

We believe that appropriately designed equity-based compensation plans, approved by shareholders, can be an effective way to align the interests of shareholders and the interests of directors, management, and employees by providing incentives to increase shareholder value. Conversely, we are opposed to plans that substantially dilute ownership interests in the company, provide participants with excessive awards, or have inherently objectionable structural features.

We will generally support measures intended to increase stock ownership by executives and the use of employee stock purchase plans to increase company stock ownership by employees. These may include:

1.       Requiring senior executives to hold stock in a company.

2.       Requiring stock acquired through option exercise to be held for a certain period of time.

These are guidelines, and we consider other factors, such as the nature of the industry and size of the company, when assessing a plan’s impact on ownership interests.

Corporate Structure

We view the exercise of shareholders’ rights, including the rights to act by written consent, to call special meetings and to remove directors, to be fundamental to good corporate governance.

Because classes of common stock with unequal voting rights limit the rights of certain shareholders, we generally believe that shareholders should have voting power equal to their equity interest in the company and should be able to approve or reject changes to a company’s by-laws by a simple majority vote.

We will generally support the ability of shareholders to cumulate their votes for the election of directors.

Shareholder Rights Plans

There are arguments both in favor of and against shareholder rights plans, also known as poison pills. For example, such measures may tend to entrench or provide undue compensation to current management, which we generally consider to have a negative impact on shareholder value. Therefore, our preference is for a plan that places shareholder value in a priority position above interests of management.

SUMMARY OF PROXY VOTING PROCEDURES

As a fiduciary to its investors, we recognize the need to actively manage and vote proxies and other shareholder actions and consents that may arise in the course of its investment advisory activities on behalf of its clients. However, due to the nature of the investments of the Fund and indirect exposure to underlying equity investments, we believe that it would be rare that we would be in a position to cast a vote or called upon to vote a proxy.

In the event that we do receive a proxy notice, shareholder consent, or is otherwise entitled to vote on any issue related to the investments of its advisory client accounts, we will process and vote all shareholder proxies and other actions in a timely manner insofar as we can determine based on the facts available at the time of its action, in the best interests of the affected advisory client(s). Although we expect that proxies will generally be voted in a manner consistent with the guidelines set forth in this policy, there may be individual cases where, based on facts available, voting according to policy would not be in the best interests of the fund and its shareholders. In such cases, we may vote counter to the stated policy.

Proxy Voting Procedure

1) Notices received are reviewed by the Compliance Department;

2) Forwarded to the Investment Department for review and voting decision;

3) Vote or consent entered according to our best judgment under the facts and circumstances presented. Such decision shall be made and documented;

4) Final review and sign-off by Compliance Department and filing with a copy in the Proxy Voting Log.

We may at any time, outsource Proxy Voting responsibilities to Institutional Shareholder Services (“ISS”) or similar service provider that we may approve, provided that such service provider votes each proxy based on decisions made by us.

CLIENT INFORMATION

A copy of these Proxy Voting Policies and Procedures is available to our clients, without charge, upon request, by calling 1-866-277-VCIF. We will send a copy of these Proxy Voting Policies and Procedures within three business days of receipt of a request, by first-class mail or other means designed to ensure equally prompt delivery.

In addition, we will provide each client, without charge, upon request, information regarding the proxy votes cast by us with regard to the client’s securities.

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

As of September 30, 2016, Mr. Chapman, Chairman of the Board and Executive Vice President of the Adviser, and Mr. David Aisner, Executive Vice President of the Adviser, are the Fund's co-portfolio managers. Each share primary responsibility for management of the Fund's investment portfolio and have served the Fund in this capacity since July 6, 2015. Mr. Chapman and Mr. Chase are not compensated through their share of the profits, if any, of the Adviser. Because the portfolio managers may manage assets for other pooled investment vehicles and/or other accounts (including institutional clients, pension plans and certain high net worth individuals) (collectively "Client Accounts"), or may be affiliated with such Client Accounts, there may be an incentive to favor one Client Account over another, resulting in conflicts of interest. For example, the Adviser may, directly or indirectly, receive fees from Client Accounts that are higher than the fee it receives from the Fund, or it may, directly or indirectly, receive a performance-based fee on a Client Account. In those instances, a portfolio manager may have an incentive to not favor the Fund over the Client Accounts. The Adviser has adopted trade allocation and other policies and procedures that it believes are reasonably designed to address these and other conflicts of interest. As September 30, 2016, Mr. Chapman and Mr. Aisner owned no shares of the Fund.

As of September 30, 2016, Mr. Chapman was responsible for the management of the following types of accounts in addition to the Fund:

Other Accounts By Type	Total Number of Accounts by Account Type	Total Assets By Account Type	Number of Accounts by Type Subject to a Performance Fee	Total Assets By Account Type Subject to a Performance Fee
Registered Investment Companies	0	$0	0	$0
Other Pooled Investment Vehicles	0	$0	0	$0
Other Accounts	0	$0	0	$0

As of September 30, 2016, Mr. Aisner was responsible for the management of the following types of accounts in addition to the Fund:

Other Accounts By Type	Total Number of Accounts by Account Type	Total Assets By Account Type	Number of Accounts by Type  Subject to a Performance Fee	Total Assets By Account Type Subject to a Performance Fee
Registered Investment Companies	0	$0	0	$0
Other Pooled Investment Vehicles	0	$0	0	$0
Other Accounts	0	$0	0	$0

Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers. Not applicable.

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

Item 11. Controls and Procedures.

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

(b)       There were no significant changes in the registrant’s internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report (in the registrant’s second fiscal half-year in the case of an annual report) that have materially affected, or are reasonably likely to materially affect, the registrant’s internal control over financial reporting. However, a change to the internal control over financial reporting was made subsequent to the end of the reporting period. This change provides for (1) the remodeling of Mortgage Notes to include additional information related to modified loans; (2) validation of the data inputs to insure complete and accurate information used to calculate the fair value; (3) enhancement of data transfer between third-party service providers to provide a more complete dataset to determine the fair value; (4) conducting of back-testing that reasonably supports the assumptions used in fair valuing the securities and (5) developing enhanced escalation procedures to address any fair valuation concerns—these enhanced escalation procedures are expected to be completed by the registrant’s next filing on this Form.

Item 12. Exhibits.

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

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

(a)(3) Not applicable.

(b) Certification(s) required by Section 906 of the Sarbanes-Oxley Act of 2002 (and Item 11(b) of Form N-CSR) are filed herewith.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

(Registrant) Vertical Capital Income Fund

By (Signature and Title)

* /s/Michael D. Cohen

Michael D. Cohen, President

Date 3/22/17

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 D. Cohen

Michael D. Cohen, President

Date 3/22/17

By (Signature and Title)

* /s/S. Jason Hall

S. Jason Hall Treasurer

Date 3/22/17

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