Forefront Income Trust (BFITX) N-CSR Certified annual shareholder report (management investment company)

UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, DC 20549

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTEREDMANAGEMENT INVESTMENT COMPANIES

Investment Company Act file number 811-22956

Forefront Income Trust(Exact name of registrant as specified in charter)

641 Lexington Avenue, 29^th Floor, New York, NY 10022

(Address of principal executive offices) (Zip code)

Cynthia Beyea

Eversheds Sutherland (US) LLP

700 Sixth Street, N.W., Washington, DC 20001

 (Name and address of agent for service)

Registrant's telephone number, including area code: 212-488-4972

Date of fiscal year end: September 30

Date of reporting period: September 30, 2017

Item 1. REPORT TO STOCKHOLDERS.

Annual Report 2017

September 30, 2017

Forefront Income Trust

This report and the financial statements contained herein are submitted for the general information of the shareholders of the Forefront Income Trust (the “Trust”). The Trust’s shares are not deposits or obligations of, or guaranteed by, any depository institution. The Trust’s shares are not insured by the FDIC, Federal Reserve Board or any other agency, and are subject to investment risks, including possible loss of principal amount invested. The Trust’s distributor is not a bank.

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Statements in this Annual Report that reflect projections or expectations of future financial or economic performance of the Forefront Income Trust (“Trust”) and of the market in general and statements of the Trust’s plans and objectives for future operations are forward-looking statements. No assurance can be given that actual results or events will not differ materially from those projected, estimated, assumed or anticipated in any such forward-looking statements. Important factors that could result in such differences, in addition to the other factors noted with such forward-looking statements, include, without limitation, general economic conditions such as inflation, recession and interest rates. Past performance is not a guarantee of future results.

An investment in the Trust involves a high degree of risk, will be illiquid and should be considered speculative. An investment is subject to the possible loss of the entire principal amount invested. The Trust is appropriate only for shareholders who can tolerate a high degree of risk and do not require a liquid investment, as the investments will be illiquid. Other than in very limited circumstances, if any, you should not expect to be able to sell your Shares other than through repurchase offers on a quarterly basis, of which there is no assurance. As a closed-end interval Trust, there is currently no secondary market for the Trust and none is expected to develop.

There can be no assurance that the Trust will meet its investment objective. It is designed for long-term investors and not as a trading vehicle. Credit or default risk may subject the Trust’s assets to additional risk. The Trust will invest primarily in unrated or below-investment-grade-rate (“junk” of high yield/high risk) present a significant risk of loss of default and are more volatile than investment grade securities. Special tax rules will apply to certain shareholders if we are not treated as a publicly offered regulated investment company (RIC). The Trust is classified as a “nondiversified” investment company, and may invest a greater portion of its assets in a more limited number of issuers than a diversified investment company. As a result, the Trust’s investment portfolio may be subject to greater risk and volatility than if its investments were made in the securities of a broad range of issuers.

The performance information quoted in this Annual Report represents past performance, which is not a guarantee of future results. Investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. An investor may obtain performance data current to the most recent month-end by visiting ncfunds.com.

This report is submitted for the general information of the shareholders of the Trust. It is not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus, which includes information regarding the Trust’s risks, objectives, fees and expenses, experience of its management, and other information.

This Annual Report was first distributed to shareholders on or about December 7, 2017.

For More Information on Your Forefront Income Trust:

 

See Our Web site at forefrontcapitaladvisors.com

or

Call Our Shareholder Services Group at 888-484-4348.

Dear Shareholders,

We appreciate your continued involvement with Forefront Income Trust. Our shareholders are our priority, which is why at Forefront the investor always comes first. Your investment satisfaction means a great deal to us which is why we strive to invest in high yielding, risk mitigated opportunities. These opportunities are designed to be non-correlated to the equity markets to provide diversification from the equity market.

Since inception, our shareholders have realized a positive return despite the volatile market environment. The Forefront Team has worked diligently to offer our investors a portfolio of non-correlated, risk mitigated, direct lending opportunities.

Below is a snapshot of the Fund’s performance compared to our benchmarks through September 30, 2017:

Average Annual Returns as of 9/30/17	Trailing three Months	Trailing six Months	1 Year	Since FIT Inception (12/31/2014)
Forefront Income Trust	2.36%	4.53%	10.92%	22.40%
S&P 500 Index (SPXT)1	4.47%	7.46%	18.58%	33.63%
S&P/LSTA Leveraged Loan Index (SPBDAL)2	1.04%	1.89%	5.30%	12.28%
BBG Barclays US Aggregate Bond Index (LBUSTRUU)3	0.84%	2.43%	0.07%	4.20%
BBG Barclays US Corporate High Yield Bond Index (LF98TRUU)4	1.98%	4.29%	8.88%	18.95%
Forefront Income Trust - With 3.00% Sales Load	-0.64%	1.50%	7.64%	18.83%

The performance data quoted above represents past performance, which is not a guarantee of future results. Investment return and principal value of an investment in the Fund will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. To obtain more current performance data regarding the Fund, including performance data current to the Fund’s most recent month-end, please call the Fund at 888-484-4348Gross Expense Ratio: 6.29%. Forefront Capital Advisors, LLC (the “Advisor”) has entered into a Contractual Agreement with the Trust to reduce its fees, absorb expenses of the Trust or both, the Fund's net annual operating expenses (exclusive of exceptions as listed in the prospectus) to not more than 1.75% of the average daily net assets of the Fund through February 1, 2018. The Agreement may not be terminated prior to that date.

Fee waivers and expenses reimbursements have positively impacted Fund performance.

641 Lexington Avenue, 29^th Fl, New York, NY 10022

+1 212.607.8150  |  www.forefrontcapitaladvisors.com

We continue to see attractive opportunities in the market place, and are confident that coupled with our structuring ability and the existing market that we will be able to successfully originate and deploy capital in high-yield opportunities.

As always, we are available to answer individual questions because at Forefront Income Trust, the investor is the priority. Please do not hesitate to call a FIT representative at 1-888-484-4348 or send an email to info@forefrontcapitaladvisors.com. Please look at our symbol: BFITX for daily reporting of our NAV.

An investment in the Trust involves a high degree of risk, will be illiquid and should be considered speculative. An investment is subject to the possible loss of the entire principal amount invested. The Trust is appropriate only for shareholders who can tolerate a high degree of risk and do not require a liquid investment, as the investments will be illiquid. The Trust will invest primarily in unrated or below-investment-grade-rate (“junk” or high yield/high risk) present a significant risk of loss of default and are more volatile than investment grade securities. The Trust is classified as a “non-diversified” investment company, and may invest a greater portion of its assets in a more limited number of issuers than a diversified investment company. As a result, the Trust’s investment portfolio may be subject to greater risk and volatility than if its investments were made in the securities of a broad range of issuers.

* The Forefront Income Trust is distributed by Rafferty Capital Markets, LLC, Garden City, NY 11530

¹ S&P 500® Index: (registered trademark of The McGraw-Hill Companies, Inc.) is an unmanaged index of 500 common stocks primarily traded on the New York Stock Exchange, weighted by market capitalization. Index performance includes the reinvestment of dividends and capital gains.

² S&P/LSTA Leverage Loan Index (LLI): The S&P/LSTA Leverage Loan Index (LLI) is a leverage loan index which covers the U.S. Loan weightings, spreads and interest payments. All of the index components are the institutional tranches (Term Loan A, Term Loan B and higher and Second Lien) of loans syndicated to U.S loan investors. Loan that consists of tranches syndicated in the U.S. market is tracked by the LLI and the Euro portion that is syndicated in the European market is tracked by the ELLI. The LLI series currently calculates total return daily with a inception date of 1 January 1997. Total return is the product of two components: interest income return and market value return.

³ Barclays Capital U.S. Aggregate Bond Index: This index covers the U.S investment grade fixed rate bod market (measuring bonds with maturities of at least one year) with index components for government and corporate securities, mortgage pass through securities, and asset backed securities. These major sectors are subdivided into more specific indices that are calculated and reported on a regular basis.

⁴ Barclays Capital U.S. High Yield Bond Index: covers the universe of fixed rate, non-investment grade debt (maximum quality rating of Ba1) pay-in-kind (PIK) bonds, Eurobonds, and debt issues from countries designated as emerging markets (e.g., Argentina, Brazil, Venezuela, etc.) are excluded but Canadian and global bonds (SEC registered) of issuers in non-EMG countries are included. Original issue zeroes, step-up coupon structures, and 144As are also included Market. The index reflects the markets-weighted performance of institutional leveraged loans in the U.S loan market based upon real-time market. One cannot invest directly in an index.

641 Lexington Avenue, 29^th Fl, New York, NY 10022

+1 212.607.8150  |  www.forefrontcapitaladvisors.com

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Forefront Income Trust 

Schedule of Investments 

As of September 30, 2017

Description *	Shares/Amount				Value (Note 1)
			Interest Rate	Maturity Date
SENIOR LOANS - 30.61%
Financial Services - 25.54%
Auto Funding Group, LLC (a)(b)	$	2,700,500	10.000%	4/20/2018	$	2,520,500
Retail - 5.07%
Banjo & Matilda, Inc.  (a)	$	500,000	0.000%	6/18/2018	$	500,000
Total Senior Loans (Cost $3,200,500)					$	3,020,500

STRUCTURED NOTES - 51.81%			Interest Rate	Maturity Date
Real Estate - 51.15%
1501 Sheepshead Bay Road Partners, LLC (a)(b)	$	250,000	18.000%	11/16/2017	$	250,000
2020 Eastchester Road, LLC (a)(b)		435,000	18.000%	11/1/2017		435,000
35 Tech Partners, LLC (a)(b)		500,000	16.500%	12/12/2017		500,000
700 Atlantic Equities, LLC (a)		435,000	18.000%	11/1/2017		435,000
Blaichbridge Driggs, LLC (a)		435,000	18.000%	11/1/2017		435,000
Caroline Square Realty, LLC (a)(b)		400,000	15.000%	1/26/2018		400,000
City Ridge Realty (a)(b)		400,000	15.000%	11/15/2017		400,000
Club at Charter Point Realty, LLC (a)(b)		397,750	15.000%	11/15/2017		397,750
CPRE Holdings, LLC (a)(b)		175,000	15.000%	12/18/2017		175,000
WB Park Avenue, LLC (a)(b)		435,000	18.000%	11/1/2017		435,000
WB West 25th Street, LLC (a)(b)		435,000	18.000%	11/1/2017		435,000
WBSH Met Tower, LLC  (a)(b)		750,000	18.000%	11/1/2017		750,000
					$	5,047,750
Retail - 0.66%
Banjo & Matilda, Inc.  (a)(b)	$	65,000	18.000%	1/4/2018	$	65,000
Total Structured Notes (Cost $5,112,750)					$	5,112,750
SUPPLIER CREDIT - 5.84%
Food and Beverage - 5.84%
Chris's Cookies(a)(c)	$	576,289			$	576,289
Total Supplier Credit (Cost $576,289)					$	576,289

WARRANTS - 0.00%			Exercise Price		Expiration Date
Banjo & Matilda, Inc.		2,000,000	$	0.02	2/17/2021	$	-
Total Warrants (Cost $0)						$	-
SHORT-TERM INVESTMENT - 0.59%
Blackrock Liquidity
Money Market Portfolio	$	57,954				$	57,954
Total Short-Term Investment (Cost $57,954)						$	57,954
Total Value of Investments (Cost $8,947,493) - 88.85%						$	8,767,493
Other Assets Less Liabilities  - 11.15%							1,100,094
Net Assets - 100%						$	9,867,587

See Notes to Financial Statements   (Continued)

Forefront Income Trust 

Schedule of Investments - Continued

As of September 30, 2017

(a) Restricted Securities.  Securities for which market quotations are not readily available.  The aggregate value of such securities is 88.26% of net assets, and the fair value has been determined under procedures approved by the Trust's Board of Trustees.  There are no discounts for these securities since there are no restrictions upon sale.

(b) Structured Notes.  There are several risks associated with the use of structured notes.  Structured notes are leveraged, thereby providing an exposure to the underlying benchmark greater than the face amount and increasing the volatility of each note relative to the change in the underlying linked financial instrument.  A highly liquid secondary market may not exist for the structured notes in which Forefront Income Trust invests, which may make it difficult for Forefront Income Trust to sell the structured notes it holds at an acceptable price or to accurately value them.  In addition, structured notes are subject to the risk that the counterparty to the instrument, or issuer, might not pay interest when due or repay principal at the maturity of the obligation. Forefront Income Trust bears the risk of loss of the amount expected to be received in the event of the default or bankruptcy of the issuer.

(c) Agreement carries a payment fee of 3% per 30 days.

Summary of Investments
	% of Net
	Assets			Value
Senior Loans		30.61	%	$	3,020,500
Structured Notes		51.81	%		5,112,750
Supplier Credit		5.84	%		576,289
Warrants		0.00	%		-
Short-Term Investment		0.59	%		57,954
Other Assets Less Liabilities		11.15	%		1,100,094
Total		100.00	%	$	9,867,587

See Notes to Financial Statements 

Forefront Income Trust

Statement of Assets and Liabilities

As of September 30, 2017    

Assets:
Investments, at value (cost $8,947,493)	$	8,767,493
Receivables:
Interest, net of allowance of $30,000		1,237,110
Due from Advisor		149,087
Prepaid expenses:
Registration and filing fees		6,416
Compliance fees		419
Insurance fees		12,531
Other assets		7,927
Total assets		10,180,983
Liabilities:
Accrued expenses:
Administration fees		8,577
Advisory fees		236,578
Distribution fees		1,423
Professional fees		40,073
Shareholder servicing fees		4,647
Custody fees		2,529
Loan fees		9,786
Trustee fees		9,783
Total liabilities		313,396
Total Net Assets	$	9,867,587
Net Assets Consist of:
Paid in Capital on shares	$	9,033,527
Undistributed net investment income		707,120
Accumulated net realized gain on investments		306,940
Accumulated net unrealized depreciation on investments		(180,000	)
Total Net Assets	$	9,867,587
Shares Outstanding, no par value (unlimited authorized shares)		917,262
Net Asset Value and Redemption Price Per Share Outstanding	$	10.85
Maximum Offering Price Per Share ($10.85 ÷ 97.00%)	$	11.19

See Notes to Financial Statements

Forefront Income Trust

Statement of Operations

For the fiscal year ended September 30, 2017    

Investment Income:
Interest, net	$	1,338,592
Dividends		3,806
Other		1,001
Total Investment Income		1,343,399
Expenses:
Advisory fees (Note 2)		225,658
Compliance fees  (Note 2)		81,241
Professional fees		160,037
Trustee fees (Note 2)		29,783
Administration fees (Note 2)		74,824
Distribution fees		14,434
Shareholder servicing fees (Note 3)		18,645
Insurance expenses		34,528
Transfer agent fees  (Note 2)		3,436
Registration and filing expenses		15,631
Shareholder fulfillment expenses		726
Custody fees (Note 2)		6,993
Securities pricing fees		1,248
Total Expenses		667,184
Fees waived by advisor per Expense Limitation Agreement (Note 2)		(221,991	)
Net Expenses		445,193
Net Investment Income		898,206
Realized and Unrealized Gain on Investments:
Net realized gain from investment transactions		306,936
Net change in unrealized depreciation on investments		(180,000	)
Net Realized and Unrealized Gain on Investments		126,936
Net Increase in Net Assets Resulting from Operations	$	1,025,142

See Notes to Financial Statements

Forefront Income Trust 

Statements of Changes in Net Assets  

For the fiscal years ended September 30,	2017			2016
Operations:
Net investment income	$	898,206		$	901,701
Net realized gain from investment transactions		306,936			43,332
Net change in unrealized (depreciation) on investments		(180,000	)		(8,332	)
Net Increase in Net Assets Resulting from Operations		1,025,142			936,701
Distributions to Shareholders:
Net investment income		(723,475	)		(525,996	)
Net realized gain on investment		(43,328	)		-
Net Decrease in Net Assets Resulting from Distributions		(766,803	)		(525,996	)
Beneficial Interest Transactions:
Shares sold		1,086,549			482,282
Reinvested dividends and distributions		76,139			28,990
Shares Repurchased		(2,845,957	)		(38,989	)
Increase (Decrease) in Net Assets Resulting from Beneficial Interest Transactions		(1,683,269	)		472,283
Net Increase (Decrease) in Net Assets		(1,424,930	)		882,988
Net Assets:
Beginning of period		11,292,517			10,409,529
End of period	$	9,867,587		$	11,292,517
Undistributed Net Investment Income	$	707,120		$	532,389
Share Information:
Shares Sold		103,906			46,855
Reinvested Distributions		7,465			2,908
Shares Repurchased		(269,258	)		(3,772	)
Net Increase (Decrease) in Shares of Beneficial Interest		(157,887	)		45,991

See Notes to Financial Statements

Forefront Income Trust 

Statement of Cash Flows 

For the fiscal year ended September 30, 2017
Cash flows from operating activities:
Net increase in net assets resulting from operations	$	1,025,142
Adjustments to reconcile net increase in capital resulting from operations to net cash provided by operating activities:
Allowance for uncollectible interest		30,000
Purchases of investments		(19,625,207	)
Proceeds from sale of investments		21,771,535
Increase in Due from Advisor		(98,964	)
Decrease in fund shares purchased		2,754
Increase in interest receivable		(603,161	)
Net realized gain from investments		(306,936	)
Change in net unrealized appreciation on investments		180,000
Increase in prepaid insurance fees		(12,531	)
Decrease in prepaid registration and filing expenses		1,244
Decrease in prepaid fund accounting fees		2,250
Decrease in prepaid compliance fees		3,331
Increase in other assets		(7,927	)
Increase in accrued administration fees		8,577
Increase in accrued professional fees		20,867
Increase in accrued distribution fees		1,423
Increase in accrued loan fees		9,786
Increase in accrued trustee fees		9,783
Increase in accrued shareholder servicing fees		1,870
Increase in accrued custody fees		1,008
Decrease in accrued shareholder fulfillment expenses		(1,350	)
Increase in accrued advisory fees		36,578
Net cash provided by operating activities		2,450,072
Cash flows from financing activities:
Fund shares sold		1,086,549
Cash distribution paid		(690,664	)
Fund shares repurchased		(2,845,957	)
Net cash used by financing activities		(2,450,072	)
Net decrease in cash and cash equivalents		-
Cash:
Beginning of period		-
Ending of period	$	-
Supplementary disclosure of cash flow information:
Noncash financing activities not included herein consist of:
Reinvested dividend and distribution of $76,139

See Notes to Financial Statements

Forefront Income Trust

Financial Highlights

For a share outstanding during the period or fiscal years ended September 30,	2017				2016				2015			(d)
Net Asset Value, Beginning of Period	$	10.50			$	10.11			$	10.00
Income from Investment Operations:
Net investment income		0.97				0.86				0.11
Net realized and unrealized gain on investments		0.12				0.04				0.00		(f)
Total from Investment Operations		1.09				0.90				0.11
Less Distributions:
From net investment income		(0.70	)			(0.51	)			-
From net realized gain on investment		(0.04	)			-				-
Total from Investment Operations		(0.74	)			(0.51	)			-
Net Asset Value, End of Period	$	10.85			$	10.50			$	10.11
Total Return (c)		10.92	%	(e)		9.15	%	(e)		1.47	%	(b)(e)
Net Assets, End of Period (in thousands)	$	9,868			$	11,293			$	10,410
Ratios of:
Gross Expenses to Average Net Assets (e)(g)		6.29	%			5.79	%			10.93	%	(a)
Net Expenses to Average Net Assets (e)(g)		1.89	%			1.75	%			1.71	%	(a)
Net Investment Income to Average Net Assets (g)(h)		8.47	%			8.38	%			3.79	%	(a)
Portfolio turnover rate		36.76	%			84.14	%			0.00	%	(b)

(a) Annualized.  Does not include annualization of non-recurring expenses.

(b) Not annualized.

(c) Total return does not reflect sales charge, if any.

(d) For a share outstanding during the period from December 31, 2014 (Commencement of Operations) to September 30, 2015.

(e) Such percentages are shown before and after advisory fee and fee waivers for the Expense Limitation Agreement (see Note 2).

(f) Less than $0.01 per share.

(g) Does not include the proportionate share of income and expenses of the investment companies in which the  Trust invests.

(h) Recognition of net investment income by the Trust is affected by the timing of the declaration of dividends by the underlying investment companies in which the Trust invests.  See notation (e).

See Notes to Financial Statements

Forefront Income Trust

Notes to Financial Statements

1. Organization and Significant Accounting Policies

The Forefront Income Trust (the “Trust”) is organized as a Delaware statutory trust organized on August 20, 2014 and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as a closed-end, non-diversified, “interval” management investment company. The Trust follows accounting and reporting guidance in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codifications 946, Financial Services – Investment Companies. The Trust became effective on December 8, 2014 and commenced operations on December 31, 2014 upon the issuance of shares.

The Trust seeks to achieve its investment objective of current income by primarily investing in fixed income securities, such as unrated or below-investment-grade-rated (commonly referred to as “junk” or high yield risk) loans and debt instruments with maturities of generally not more than three years, as well as, to a lesser extent, dividend yielding preferred securities, all of which will represent what Forefront Capital Advisors, LLC (the “Advisor”) believes to be deep value opportunities, in that they will offer prospective returns that are high in proportion to their risks as assessed by the Advisor based on its fundamental analysis.

The following is a summary of significant accounting policies consistently followed by the Trust. The policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The Trust’s fiscal year end is September 30.

Investment Valuation

The Trust’s investments in securities are carried at fair value. Securities listed on an exchange or quoted on a national market system are valued at the last sales price as of 4:00 p.m. Eastern Time. Securities traded in the NASDAQ over-the-counter market are generally valued at the NASDAQ Official Closing Price. Other securities traded in the over-the-counter market and listed securities for which no sale was reported on that date are valued at the most recent bid price. Securities and assets for which representative market quotations are not readily available (e.g., if the exchange on which the security is principally traded closes early or if trading of the particular security is halted during the day and does not resume prior to the Trust’s net asset value calculation) or which cannot be accurately valued using the Trust’s normal pricing procedures are valued at fair value as determined in good faith under policies approved by the Trustees, who consist of the Independent Trustees, the Chairman, and the Chief Executive Officer of the Advisor. A security’s “fair value” price may differ from the price next available for that security using the Trust’s normal pricing procedures. Instruments with maturities of 60 days or less are valued at amortized cost, which approximates market value.

Investments in underlying investment vehicles are valued, as a practical expedient, utilizing the net asset valuations provided by the underlying investment vehicles and/or their administrators, without adjustment, when the net asset valuations of the investments are calculated in a manner consistent with GAAP for investment companies. The Trust applies the practical expedient to its investments in underlying investment vehicles on an investment-by-investment basis, and consistently with the Trust’s entire position in a particular underlying investment vehicle, unless it is probable that the Trust will sell a portion of an investment at an amount different from the net asset valuation. If it is probable that the Trust will sell an investment in the underlying investment vehicle at an amount different from the net asset valuation or in other situations where the practical expedient is not available, the Trust considers other factors in addition to the net asset valuation, such as subscription and redemption rights, expected discounted cash flows, transactions in the secondary market, bids received from potential buyers, and overall market conditions in its determination of fair value.

Valuation of Securities For Which Independent Pricing Sources Are Not Available

The Trust may hold certain interests in loans and other fixed income securities, including senior loans, and will not have readily available market quotations or will not be priced by an independent pricing source or pricing model. Such loans and fixed income securities will be valued by the Advisor, Forefront Capital Advisors, LLC (the “Advisor”), according to the fair value process set forth in the Trust’s valuation policies and procedures. Loans and other securities held by the Trust which do not trade in any market, which are not priced by an independent pricing source or pricing model, or which are deemed to be illiquid will be valued at fair value by the Advisor under valuations policies and procedures established by and under the general supervision and responsibility of the Trust’s Board of Trustees.

(Continued)

Forefront Income Trust

Notes to Financial Statements

The Advisor meets with the Board of Trustees on a monthly basis, or more frequently as needed, to review and discuss the appropriateness of such fair values using more current information such as, recent security news, recent market transactions, updated corporate action information and/or other macro or security specific events. The Advisor is responsible for developing the Trust’s written valuation processes and procedures, conducting periodic reviews of the valuation policies, and evaluating the overall fairness and consistent application of the valuation policies as well as ensuring that the valuation methodologies for investments that are categorized within Level 3 of the fair value hierarchy are fair, consistent, and verifiable. Valuations determined by the Advisor are required to be supported by market data, third-party pricing sources, industry accepted third-party pricing models, counterparty prices, or other methods the Board of Trustees deem to be appropriate, including the use of internal proprietary pricing models. When determining the reliability of third party pricing information for investments owned by the Trust, the Board of Trustees, among other things, conducts due diligence reviews of pricing vendors, monitors the daily change in prices and reviews transactions among market participants.

Also, when observable inputs become available, the Board of Trustees conducts back testing of the methodologies used to value Level 3 financial instruments to substantiate the unobservable inputs used to value those investments. Such back testing includes comparing Level 3 investment values to observable inputs such as exchange-traded prices, transaction prices, and/or vendor prices.

The fair value methodologies and processes set forth in the Trust’s valuation policies and procedures take into account applicable regulatory and accounting guidance, including the fair value measurement standards incorporated in Financial Accounting Standards Board (“FASB”) Topic 820, in addition to other factors, as defined below.

Fair Value Measurement

Various inputs are used in determining the value of the Trust's investments. These inputs are summarized in the three broad levels listed below:

Level 1: quoted prices in active markets for identical securities

Level 2: other significant observable inputs (including quoted prices for similar securities and identical securities in inactive markets, interest rates, credit risk, etc.)

Level 3: significant unobservable inputs (including the Trust’s own assumptions in determining fair value of investments)

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.

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

(Continued)

Forefront Income Trust

Notes to Financial Statements

The following table summarizes the inputs as of September 30, 2017 for the Trust’s assets measured at fair value:

Investments (a)	Total		Level 1		Level 2		Level 3
Assets
Senior Loans	$	3,020,500	$	-	$	-	$	3,020,500
Structured Notes		5,112,750		-		-		5,112,750
Supplier Credit		576,289		-		-		576,289
Warrants		-		-		-		-
Short-Term Investment		57,954		57,954		-		-
Total	$	8,767,493	$	57,954	$	-	$	8,709,539

(a) The Trust had no significant transfers into or out of Level 1, 2, or 3 during the fiscal year ended September 30, 2017. The Trust held Level 3 securities during the fiscal year. The aggregate value of such securities is 88.26% of net assets, and they have been fair valued under procedures approved by the Trust’s Board of Trustees. It is the Trust’s policy to record transfers at the end of the reporting period.

The table below presents a reconciliation of all Level 3 fair value measurements existing at September 30, 2017:

	Limited Liability Company Interest			Senior Loans			Structured Notes			Supplier Credit		Warrants
Opening Balance	$	2,500,000		$	3,180,000		$	4,675,000		$	-	$	-
Purchases		-			320,500			3,000,000			576,289		-
Principal payments/sales		(2,806,936	)		(300,000	)		(2,562,250	)		-		-
Accrued discounts (premiums)		-			-			-			-		-
Realized Gains		306,936			-			-			-		-
Unrealized Losses		-			(180,000	)		-			-		-
Ending Balance	$	-		$	3,020,500		$	5,112,750		$	576,289	$	-

(Continued)

Forefront Income Trust

Notes to Financial Statements

Level 3 asset category	Value ($)	Valuation Technique	Unobservable Input
Senior Loans – Financial Services	2,520,500	Adjusted net asset approach	Performance indicators & net collateral value
Senior Loans – Retail	500,000	Cost approach	Financial indicators
Structured Notes – Real Estate	5,047,750	Adjusted net asset approach	Appraisal value (a) & net collateral value
Structured Notes – Retail	65,000	Cost approach	Financial indicators
Supplier Credit	576,289	Cost approach	Financial indicators
Warrants	-	Quoted stock price vs. exercise price	Impact of exercise on limited market, industry/market conditions
Total	8,709,539

(a) Appraised market value based on certified appraisal reports less the first secured position loan balance.

Range of inputs and certified appraisal quotes not included as the Fund does not develop the quantitative inputs.

Valuation Techniques

Limited Partnership

The Advisor uses the market approach valuation technique to value its limited partnership investment in underlying investment vehicles. An investment in an underlying investment vehicle is carried at its estimated fair value which is based on the Trust’s proportionate share of the net assets of the underlying investment vehicles as reported to the Trust by such entities at the reporting date. Investments in underlying investment vehicles are included in Level 2 or 3 of the fair value hierarchy. In determining the level, the Trust considers the length of time until the investment in the underlying investment vehicle is redeemable, including notice and lock-up periods or any other restriction on the disposition of the underlying investment vehicle. The Trust also considers the information provided by underlying investment vehicles, the nature of the portfolios of the underlying investment vehicle and their ability to liquidate their portfolio of investments when determining the level.

Senior Loans and Structured Notes

Investments in private operating companies also consist of senior loan investments and structured notes. The transaction price, excluding transaction costs, is typically the Trust’s best estimate of fair value at inception. When evidence supports a change to the carrying value from the transaction price, adjustments are made to reflect expected exit values in the investment’s principal market under current market conditions. Ongoing reviews by management are based on an assessment of each underlying investment from the inception date through the most recent valuation date. These assessments typically incorporate valuation techniques that consider trends in the performance and credit profile of each underlying investment, evaluation of arm’s length financing, an income approach based upon a discounted cash flow analysis and sales transactions with third parties. Inputs relied upon by debt investments using the income approach include an understanding of the underlying company’s compliance with debt covenants, the operating performance of the underlying company, trends in liquidity and financial leverage ratios of the underlying company from the point of the original investment to the stated valuation date, an assessment of the credit profile of the underlying company from the original investment to the stated valuation date, as well as an assessment of the underlying company’s business enterprise value, liquidation value and debt repayment capacity of each subject debt investment. In addition, inputs include an assessment of potential yield adjustments for each debt investment based upon trends in the credit profile of the underlying company and trends in the interest rate environment from the date of the original investment to the stated valuation date. Investments in senior loans and structured notes provided to private operating companies are generally included in Level 3 of the fair value hierarchy.

(Continued)

Forefront Income Trust

Notes to Financial Statements

Supplier Credit

The Trust’s investment in supplier credit is priced at estimated fair value which is based on the sales contract (invoice) value. The buyer is bound by the terms and conditions of the sale contract. Ongoing reviews by management are based on the investment’s financial performance measured by activity ratios like: receivables turnover ratio, liquidity ratios, assessment of market conditions and industry sector seasonality.

Warrants

The Trust may invest in derivative financial instruments (derivatives), like warrants, in order to manage risk or gain exposure to various other investments or markets. Derivatives may contain various risks including the potential inability of the counterparty to fulfill their obligations under the terms of the contract, the potential for an illiquid secondary market, and the potential for market movements which may expose the Fund to gains or losses in excess of the amounts shown on the Statement of Assets and Liabilities. Trust Level 3 investments in warrants have been valued by comparing quoted stock price against exercise price.

Short Term Investment

Investments in the short term investment for the money market portfolio account was priced at the ending net asset value (NAV) provided by the service agent of the account. These securities will be categorized as Level 1 securities since they are valued at the closing price reported by an active market.

At September 30, 2017, investments in the Senior Loans, Structured Notes, and warrants within Level 3 have been valued at fair value using unadjusted third party transaction prices as described above by the Advisor. The Senior Loans, Structured Notes, and warrants are collateralized by underlying assets and/or real estate property. As part of the Trust’s analysis for entering into these loans as well as for its fair value analysis, the Advisor will value the collateral using valuation techniques such as the discounted cash flow method, the direct capitalization method and the comparable sales method. The Trust’s Level 3 investment in the Limited Partnership was valued using the unadjusted net asset value of investments in private investment vehicles.

Investment Transactions and Investment Income

Investment transactions are accounted for as of the date purchased or sold (trade date). Dividend income is recorded on the ex-dividend date. Certain dividends from investments will be recorded as soon as the Trust is informed of the dividend if such information is obtained subsequent to the ex-dividend date. Interest income is recorded on the accrual basis and includes accretion of discounts and amortization of premiums. Generally, when interest and/or principal payments on a loan become past due, or if the Trust otherwise does not expect the borrower to be able to service its debt and other obligations, the Trust will place the loan on non-accrual status and will generally cease recognizing interest income on that loan for financial reporting purposes until all principal and interest have been brought current through payment or due to restructuring such that the interest income is deemed to be collectible. The Trust generally restores non-accrual loans to accrual status when past due principal and interest is paid and, in the Trust’s judgment, the payments are likely to remain current. As of September 30, 2017, the Trust had $500,000 non-accrual assets held in its portfolio. Gains and losses are determined on the identified cost basis, which is the same basis used for federal income tax purposes.

Expenses

The Trust bears expenses incurred specifically on its behalf as well as a portion of general Trust level expenses, which are allocated according to methods reviewed and approved annually by the Trustees. The expenses of the Trust are detailed below in Note 2.

(Continued)

Forefront Income Trust

Notes to Financial Statements

Distributions

The Trust may declare and distribute dividends from net investment income (if any) quarterly. Distributions from capital gains (if any) are generally declared and distributed annually. Dividends and distributions to shareholders are determined in accordance with income tax regulations and are recorded on ex-dividend date.

Estimates

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 increases and decreases in the net assets from operations during the reported period. Actual results could differ from those estimates.

Federal Income Taxes

No provision for income taxes is included in the accompanying financial statements, as the Trust intends to distribute to shareholders all taxable investment income and realized gains and otherwise comply with Subchapter M of the Internal Revenue Code applicable to regulated investment companies.

2. Transactions with Affiliates and Service Providers

Advisor

The Trust will not pay the Advisor a fixed management fee. The Trust will pay the Advisor an Advisory Fee annually in arrears for the previous fiscal year after the close of such fiscal year and in the first quarter following the close of such fiscal year, subject to the Trust having achieved an increase in its Pre-Advisory Fee Net Investment Income for that previous fiscal year of 8.00% (in other words, subject to the Trust having achieved an 8.00% Pre-Advisory Fee net return (the “Hurdle”) for its shareholders for that previous fiscal year.) The Advisor will receive no compensation until after the Hurdle is passed. Thereafter, the Advisory Fee will be charged, and will be equal to (i) 80% of the portion, if any, of the Trust’s Pre-Advisory Fee Net Investment Income (as defined below) that exceeds the 8.00% Hurdle but is less than or equal to an 18.00% return, plus (ii) 20% of the portion, if any, of the Trust’s Pre-Advisory Fee Net Investment Income that exceeds an 18.00% return. For the purposes of calculating the Advisory Fee, “Pre-Advisory Fee Net Investment Income shall mean, with respect to any fiscal year, interest income, dividend income, and any other income, including (i) any fees such as commitments and origination fees received by the Trust; (ii) any structuring, diligence, consulting, and any other fees received by the Trust, or by the Advisor and accruing to the Trust, in connection with the Trust investment; and (iii) any income received from investments with a deferred interest feature (such as original interest discount, pay in kind interest, and zero coupon securities), less other expenses. Pre-Advisory Fee Net Investment Income does not include any realized or unrealized capital gains. For the purposes of calculating Pre-Advisory Fee Net Investment Income, neither the liquidation preference of any preferred shares issued by the Trust nor the aggregate amount of any borrowings for investment purposes will be deducted from the Trust’s total assets. Pre-Advisory Fee Net Investment Income includes accrued income that we have not yet received in cash, such as the amount of any market discount we may accrue on debt instruments we purchase below par value. The Trust incurred $225,658 in Advisory Fees during the fiscal year ended September 30, 2017 The liability for accrued advisory fees at September 30, 2017 was $236,578. Total Advisory fees paid to the Advisor from the Trust during the fiscal year were $189,080.

The Advisor has entered into a contractual agreement (the “Expense Limitation Agreement”) with the Trust, under which it has agreed to waive or reduce its fees and to assume other expenses of the Trust, if necessary, in amounts that limit the Trust’s total operating expenses (exclusive of investment advisory fee, interest, taxes, brokerage commissions, borrowing costs, fees and expenses of other investment companies in which the Trust invests, and other expenditures which are capitalized in accordance with generally accepted accounting principles, other extraordinary expenses not incurred in the ordinary course of the Trust’s business, and amounts, if any, payable under a Rule 12b-1 distribution plan) to not more than 1.75% of the average daily net assets of the Trust. The current term of the Expense Limitation Agreement remains in effect until December 31, 2017. While there can be no assurance that the Expense Limitation Agreement will continue after that date, it is expected to continue from year-to-year thereafter.

(Continued)

Forefront Income Trust

Notes to Financial Statements

The Advisor paid the initial organizational expenses of the Fund, which amounted to $37,500, and are subject to repayment by the Fund, provided the Fund is able to make such repayment without causing operating expenses to exceed the annual rate of 1.75% and provided that the fees and expenses which are subject of the repayment were incurred within three years of the repayment. As of the fiscal year ended September 30, 2017, the remaining amount for recoupment by the Advisor was $37,500. The Advisor reimbursed the Fund for $121,123 during the year, of which all was related to expenses incurred for during the fiscal year from October 1, 2016 through September 30, 2017. The amount due from the Advisor at September 30, 2017 was $149,087. The organizational expenses can be recouped by the Advisor on or before December 31, 2017, per the Expense Limitation Agreement of the Trust.

Organizational and Deferred Offering Costs

The Fund’s organizational costs of $37,500, which were incurred prior to the commencement of operations through September 10, 2014, are due to be recouped by the Advisor. The organizational costs consisted of legal fees incurred to establish and launch the Trust. The organizational costs are subject to repayment by the Fund until December 31, 2017 as noted above. The organizational costs were expensed as incurred.

The Fund’s offering costs consisted of legal fees for preparing the initial prospectus and statement of additional information. These offering costs, which are subject to the Expense Limitation Agreement, were accounted for as deferred cost until the commencement of operations, and, thereafter, amortized to expense over twelve months on a straight-line basis. There were no remaining costs to be amortized or deferred for the fiscal year ended September 30, 2017.

Administrator

For the period October 1, 2016 through December 31, 2016, The Nottingham Company provided services as the Trust’s Administrator. During this period, the Trust incurred $17,247 in fees.

During the period October 1, 2016 through December 31, 2016, the Trust paid a monthly fee to The Nottingham Company based upon the average daily net assets of the Trust and calculated at the annual rates as shown in the schedule below which is subject to a minimum of $2,500 per month. The Nottingham Company also received a fee to procure and pay the Trust’s custodian, additional compensation for fund accounting and recordkeeping services, and additional compensation for certain costs involved with the daily valuation of securities and as reimbursement for out-of-pocket expenses. A breakdown of these fees is provided below.

Administration Fees*		Custody Fees*
Average Net Assets	Annual Rate	Average Net Assets	Annual Rate	Fund Accounting Fees (monthly)	Fund Accounting Fees	Blue Sky Administration Fees (annual)
First $250 million	0.070%	First $500 million	0.010%	$2,500	0.01%	$150 per state
Next $250 million	0.050%	Over $500 million	0.0075%
Next $500 million	0.030%
Over $1 billion	0.020%
		*Minimum monthly fees of $2,500 and $417 for Administration and Custody, respectively.

As of January 1, 2017, the Trust has engaged S&Z Fund Services, LLC as its Administrator (the “Administrator”). The Trust is charged a fee of $5,000 per month for administrative services. During the period from January 1, 2017 through September 30, 2017, the Trust incurred $57,577 in fees. At September 30, 2017, there were $8,577 in fees payable to the Administrator.

Compliance Services

For the period October 1, 2016 through November 30, 2016 David Wasitowski, an officer of the Advisor, served as the Trust’s Chief Compliance Officer.

(Continued)

Forefront Income Trust

Notes to Financial Statements

Barge Consulting, LLC currently serves as the Trust’s Chief Compliance Officer. Barge Consulting, LLC is entitled to receive customary fees of $5,800 per month from the Trust for their services pursuant to the Compliance Services agreement with the Trust. The Trust incurred $81,241 in fees for compliance services for the fiscal year ended September 30, 2017. At September 30, 2017 there were no fees payable to Barge Consulting, LLC.

Transfer Agent

For the period October 1, 2016 through December 31, 2016, The Nottingham Company served as transfer, dividend paying, and shareholder servicing agent for the Trust. During this period, The Nottingham Company was entitled to receive compensation from the Trust pursuant to the fee arrangements with the Trust. During this period, the Trust incurred $3,436 in fees.

As of January 1, 2017, S&Z Fund Services, LLC (“Transfer Agent”) serves as transfer, dividend paying, and shareholder servicing agent for the Trust. S&Z Fund Services, LLC does not separately bill for these services.

Distributor

For the period October 1, 2017 through December 31, 2016, Capital Investment Group, Inc. served as the Trust’s principal distributor. Capital Investment Group, Inc. received $5,000 per year for services provided and expense assumed. During this period, the Trust incurred $1,023 in fees.

For the period January 1, 2017 through September 14, 2017, Foreside Fund Services, LLC served as the Trust’s principal distributor. Foreside Fund Services, LLC received $1,500 per month for services provided and expenses assumed. During this period, the Trust incurred $12,745 in fees. At September 30, 2017, there were $1,423 in fees payable to Foreside Fund Services, LLC.

As of September 15, 2017, Rafferty Capital Markets, LLC (the “Distributor”) serves as the Trust’s principal distributor. The Distributor is entitled to receive customary fees of $1,333 per month from the Trust for their services pursuant to the Distribution Agreement with the Trust. The Trust incurred $666 in fees during September 2017. At September 30, 2017, there were no fees payable to the Distributor.

Trustees

The Board of Trustees consists of two Independent Trustees. The Trustees are each entitled to receive $5,000 in fees per quarter. For the period of October 1, 2016 through December 31, 2016, the Board of Trustees consisted of one independent Trustee. For the fiscal year ended September 30, 2017, the Trust incurred $29,783 in fees. At September 30, 2017, there were $9,783 in fees payable to the Trustees.

3. Shareholder Service Plan Fees

The Trustees, including a majority of the Trustees who are not “interested persons” of the Trust as defined in the 1940 Act and who have no direct or indirect financial interest in such plan or in any agreement related to such plan, adopted a Shareholder Service Plan under which certain assets of the Trust may be used to compensate the Trust’s principal underwriter within meaning of the 1940 Act, and brokers, dealers, and other financial intermediaries for providing personal services to shareholders and/or the maintenance of shareholder accounts with respect to the Trust’s shares of beneficial interest. For the fiscal year ended September 30, 2017, $18,645 in fees were incurred by the Trust. There were $4,647 in fees payable at September 30, 2017.

4. Share Repurchase Program

The Trust makes quarterly offers to repurchase its Shares pursuant to Rule 23c-3(b) under the 1940 Act. The Trust is authorized to repurchase between 5% and 25% of its Shares outstanding on the quarterly repurchase request deadline. However, no assurance can be given that shareholders will be able to sell all of their Shares tendered to the Trust pursuant to any particular repurchase offer or than any particular Shares tendered will be accepted in such a repurchase offer. Shares tendered for repurchase within 180 days from the date of the original issuance of the Shares will be subject to a repurchase fee of 2%. The Trust’s quarterly repurchase offers will end on the third Friday (or the preceding business day if such third Friday is not a business day) of each month in which a repurchase offer ends. FIT is eligible to make, once every two years, an offer to its shareholders to repurchase their shares of FIT with respect to a percentage of the total outstanding shares of FIT outside of the Quarterly Repurchase Offers pursuant to Rule 23c-3(c) under the 1940 Act (a “Special Repurchase Offer”), and, as of the date of this Agreement, FIT has not previously made any Special Repurchase Offers.

(Continued)

Forefront Income Trust

Notes to Financial Statements

Special Redemption Rights

In certain varying circumstances, an issuer of preferred securities may redeem the securities prior to a specified date. For instance, for certain types of preferred securities, a redemption may be triggered by certain changes in U.S. federal income tax or securities laws. As with call provisions, a special redemption by the issuer may negatively affect the return of the security held by the Trust.

5. Purchases and Sales of Investment Securities

For the fiscal year ended September 30, 2017, the aggregate cost of purchases and proceeds from sales of investment securities (excluding short-term securities) were as follows:

Purchases of Securities	Proceeds from Sales of Securities
$3,896,789	$5,669,186

There were no long-term purchases or sales of U.S Government Obligations during the fiscal year ended September 30, 2017.

6. Federal Income Tax

Distributions are determined in accordance with Federal income tax regulations, which differ from GAAP, and, therefore, may differ significantly in amount or character from net investment income and realized gains for financial reporting purposes. Financial reporting records are adjusted for permanent book/tax differences to reflect tax character but are not adjusted for temporary differences.

Management reviewed the Trust’s tax positions taken on federal income tax returns for the open tax year/period of September 30, 2016 and September 30, 2017 and concluded that the Trust does not have a liability for uncertain tax positions. The Trust recognizes interest and penalties, if any, related to unrecognized tax benefits as income tax expense in the Statement of Operations. During the year, the Trust did not incur any interest or penalties. The Trust identifies its major tax jurisdictions as U.S. Federal and New York State where the Trust makes its significant investments. The Trust does not expect that its assessment regarding unrecognized tax positions will change over the next twelve months. There are no income tax returns currently under examination.

Distributions during the year ended were characterized for tax purposes as follows:

	September 30, 2017	September 30, 2016
Ordinary Income	$ 766,803	$ 525,996

At September 30, 2017, the tax-basis cost of investments and components of distributable earnings were as follows:

(Continued)

Forefront Income Trust

Notes to Financial Statements

Cost of Investments	$	8,947,493
Unrealized Appreciation		-
Unrealized Depreciation		(180,000	)
Net Unrealized Depreciation		(180,000	)
Undistributed Ordinary Income		707,120
Distributable Earnings	$	707,120

7. Commitments and Contingencies

Under the Trust’s organizational documents, its officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. In addition, in the normal course of business, the Trust entered into contracts with its service providers, on behalf of the Trust, and others that provide for general indemnifications. The Trust’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Trust. The Trust expects the risk of loss to be remote.

8. Investments in Restricted Securities

Restricted securities include securities that have not been registered under the Securities Act of 1933. The Trust may invest in restricted securities that are consistent with the Trust’s investment strategy. Investments in restricted securities are valued at fair value under procedures approved by the Trust’s Board of Trustees. As of September 30, 2017, the Trust was invested in the following restricted securities:

Security	Initial Purchase Date	Shares/Amount	Cost	Value	% of Net Assets
700 Atlantic Equities, LLC	5/2/2016	$435,000	$435,000	$435,000	4.41%
Auto Funding Group, LLC	10/20/2015	$2,700,500	$2,700,500	$2,520,500	25.54%
Banjo & Matilda, Inc.	6/18/2015	$500,000	$500,000	$500,000	5.07%
35 Tech Partners, LLC	12/22/2016	$500,000	$500,000	$500,000	5.07%
Banjo & Matilda, Inc.	1/4/2017	$65,000	$65,000	$65,000	0.66%
1501 Sheepshead Bay Road Partners	1/19/2016	$250,000	$250,000	$250,000	2.53%
2020 Eastchester Road, LLC	4/19/2016	$435,000	$435,000	$435,000	4.41%
Blaichbridge Driggs, LLC	3/11/2016	$435,000	$435,000	$435,000	4.41%
Caroline Square Realty, LLC	7/26/2017	$400,000	$400,000	$400,000	4.05%
City Ridge Realty	3/21/2017	$400,000	$400,000	$400,000	4.05%
Club at Charter Point Realty, LLC	3/21/2017	$397,750	$397,750	$397,750	4.03%
CPRE Holdings, LLC	9/19/2017	$175,000	$175,000	$175,000	1.77%
WB Park Avenue, LLC	10/30/2015	$435,000	$435,000	$435,000	4.41%
WB West 25th Street, LLC	12/1/2015	$435,000	$435,000	$435,000	4.41%
WBSH Met Tower, LLC	6/30/2015	$750,000	$750,000	$750,000	7.60%
Banjo & Matilda, Inc. Warrants	3/2/2016	2,000,000	$0	$0	0.00%
Chris’s Cookies	Various	$576,289	$576,289	$576,289	5.84%

(Continued)

Forefront Income Trust

Notes to Financial Statements

9. Principal Risks

The Trust in the normal course of business makes investments in financial instruments where the risk of potential loss exists due to changes in the market (market risk), or failure or inability of the counterparty to a transaction to perform (credit and counterparty risk). See below for a detailed description of select principal risks.

Market risk. The Trust’s investments in financial instruments expose it to various risks such as, but not limited to, interest rate and equity. Interest rate risk is the risk that a fixed income investment's value will change due to a change in the absolute level of interest rates, in the spread between two rates, in the shape of the yield curve or in any other interest rate relationship. Such changes usually affect securities inversely and can be reduced by diversifying (for example, investing in fixed-income securities with different durations) or hedging (for example, through an interest rate swap).

Equity risk. Equity Risk is the risk that the market values of equities, such as common stocks or equity related investments may decline due to general market conditions, such a political or macroeconomic factors. Additionally, equities may decline in value due to specific factors affecting a related industry or industries. Equity securities and equity related investments generally have greater market price volatility than fixed income securities.

Credit and counterparty risks. The Trust is exposed to credit risk to counterparties with whom it transacts with and also bears the risk of settlement default. The Trust may lose money if the issuer or guarantor of a fixed income security is unable or unwilling to make timely principal and/or interest payments, or to otherwise honor its obligations.

10. Subsequent Events

In accordance with GAAP, the Trust has evaluated the need for disclosures and/or adjustments resulting from subsequent events through the date of issuance of these financial statements. Management has evaluated subsequent events through the issuance of these financial statements.

(Continued)

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Shareholders,

Trustees, and

Audit Committee of

Forefront Income Trust

We have audited the accompanying statement of assets and liabilities of the Forefront Income Trust (the “Trust”), including the schedule of investments, as of September 30, 2017, and the related statements of operations, statement of cash flows for the year then ended, the statements of changes in net assets, for each of the two years in the period then ended, and the financial highlights for each of the two years in the period then ended and the period from December 31, 2014 (Date of commencement of operations) to September 30, 2015. These financial statements and financial highlights are the responsibility of the Trust's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audit.

We conducted our audit 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. The Trust is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Trusts’ internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. Our procedures included confirmation of securities owned as of September 30, 2017, by correspondence with the custodian and brokers. We believe that our audit provides 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 the Forefront Income Trust as of September 30, 2017, and the related statements of operations, statement of cash flows for the year then ended, the statements of changes in net assets, for each of the two years in the period then ended, and the financial highlights for each of the two years in the period then ended and the period from December 31, 2014 (Date of commencement of operations) to September 30, 2015 in conformity with accounting principles generally accepted in the United States of America.

Chicago, Illinois

December 7, 2017

Forefront Income Trust

Additional Information (Unaudited)

1. Proxy Voting Policies and Voting Record

A copy of the Trust’s Proxy Voting and Disclosure Policy and the Advisor’s Disclosure Policy are included as Appendix B to the Trust’s Statement of Additional Information and are available, without charge, upon request, by calling 800-773-3863, and on the website of the Securities and Exchange Commission (“SEC”) at sec.gov. Information regarding how the Trust voted proxies relating to portfolio securities during the most recent period ended June 30, is available (1) without charge, upon request, by calling the Trust at the number above and (2) on the SEC’s website at sec.gov.

2. Quarterly Portfolio Holdings

The Trust files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The Trust’s Forms N-Q are available on the SEC’s website at sec.gov. You may review and make copies at the SEC’s Public Reference Room in Washington, D.C. Information on the operation of the Public Reference Room may be obtained by calling the SEC at 800-SEC-0330. You may also obtain copies without charge, upon request, by calling the Trust at 888-484-4348.

3. Tax Information

We are required to advise you within 60 days of the Trust’s fiscal year-end regarding the federal tax status of certain distributions received by shareholders during each fiscal year. The following information is provided for the Trust’s fiscal year ended September 30, 2017.

During the fiscal year, there were $766,803 in income distributions paid by the Trust, but no long-term capital gain distributions paid by the Trust.

Dividend and distributions received by retirement plans such as IRAs, Keogh-type plans, and 403(b) plans need not be reported as taxable income. However, many retirement plans may need this information for their annual information meeting.

4. Schedule of Shareholder Expenses

As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments, loads on reinvestments; redemption fees; and exchange fees; and (2) ongoing costs, including management fees; distribution [and/or service] (12b-1) fees; and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period from April 1, 2017 through September 30, 2017.

Actual Expenses – The first line of the table below provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (e.g., an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

Hypothetical Example for Comparison Purposes – The second line of the table below provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.

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Forefront Income Trust

Additional Information (Unaudited)

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads), redemption fees, or exchange fees. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

Forefront Income Trust	Beginning Account Value April 1, 2017	Ending Account Value September 30, 2017	Expenses Paid During Period*
Actual	$1,000.00	$1,045.30	$9.69
Hypothetical (5% annual return before expenses)	$1,000.00	$1,015.59	$9.55

* Expenses are equal to the average account value over the period multiplied by the Trust’s annualized expense ratio multiplied by 183/365 (to reflect the one-half year period).

Name, Ageand Address	Positionheld withTrust or Trust	Length of  Time Served	Principal OccupationDuring Past 5 Years	Number of Portfolios in Trust Complex Overseen by Trustee	Other DirectorshipsHeld by TrusteeDuring Past 5 Years
Independent Trustees
Vikram Kuriyan, Ph.D., CFAAge: 52 641 Lexington Ave29th Floor New York, NY 10022	Independent Trustee, Chairman of the Audit Committee	Since 08/14	Various positions at the Indian School of Business, including Director of the Investment Laboratory and Clinical Professor since 2010; Member of the China-India Advisory Council of the CFA Institute.	1	Independent Director of TVS Capital Funds.
Interested Trustee*
Bradley ReiflerAge: 58 641 Lexington Ave29th Floor New York, NY 10022	Trustee, Chairman of the Board of Trustees	Since 08/14	Director of Sino Mercury Acquisition Corporation since 2014; Chief Executive Officer of Forefront Capital Advisors, LLC (2014-2016); Chief Executive Officer of Forefront Capital Management from 2009 to 2014; Chief Executive Officer of Forefront Capital Markets, LLC from 2011 to 2015.	1	Wins Finance Holding; Cifco; Millbrook; King Penguin.
* Basis of Interestedness. Mr. Reifler is an Interested Person by virtue of his position as an officer of the Trust. Mr. Reifler is also an officer of the Advisor and a member of the Advisor’s Investment Committee and Valuation Committee.
Other Officers
Cole ReiflerAge: 25 641 Lexington Ave29th Floor New York, NY 10022	President, Chief Executive Officer and Secretary	President/ CEO since 03/17; Secretary since 06/17	Forefront Capital Advisors, LLC, Managing Member (Feb 2017-present) Vice President (Jan 2015-Feb 2017); Martel Capital, LLC, Registered Representative, (Sept 2014-Sept 2017); Forefront Capital Markets, Registered Representative (Oct 2014-Aug 2016).	1	n/a

Name, Ageand Address	Positionheld withTrust or Trust	Length of  Time Served	Principal OccupationDuring Past 5 Years	Number of Portfolios in Trust Complex Overseen by Trustee	Other DirectorshipsHeld by TrusteeDuring Past 5 Years
Michael Flatley Age: 68 641 Lexington Ave29th Floor New York, NY 10022	Chief Financial Officer	Since 06/17	Forefront Capital Advisors, LLC, CFO and Portfolio Manager ([May 2017-present)]; Forefront Global Advisors, LLC (01/2014-present); Michael Flatley, LLC, President and founder (06/2008-01/2014), financial services business providing life insurance annuities and estate planning services.	1	n/a
Marvin Barge Age: 52 641 Lexington Ave29th Floor New York, NY 10022	Chief Compliance Officer	Since 11/16	Chief Compliance Officer since November 2016; President/ Founder at Barge Consulting LLC since May 2000.	1	n/a

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Forefront Income Trust

For Shareholder Service Inquiries:	For Investment Advisor Inquiries:
S&Z Fund Services, LLC	Forefront Capital Advisors, LLC
145 Pinelawn Road	641 Lexington Avenue
Suite 200 South	29th Floor
Melville, New York 11747	New York, NY 10022
Telephone:	Telephone:
631-368-3110	888-484-4FIT
	World Wide Web @:
	forefrontcapitaladvisors.com
Distributor:
Rafferty Capital Markets, LLC
1010 Franklin Avenue
Suite 300A
Garden City, NY 11530

There is no affiliation between Forefront Income Trust, including its principals, and Rafferty Capital Markets, LLC.

Item 2. CODE OF ETHICS.

The registrant, as of the end of the period covered by this report, has adopted a code of ethics that applies to its Principal Executive Officer, Principal Financial Officer, and Principal Accounting Officer(s), or persons performing similar functions, regardless of whether these individuals are employed by the registrant or a third party.

(c)There have been no substantive amendments during the period covered by this report.

(d)The registrant has not granted, during the period covered by this report, any waivers, including an implicit waiver.

(f)(1)  A copy of the code of ethics that applies to the registrant's Principal Executive Officer and Principal Financial Officer is filed pursuant to Item 12.(a)(1) below.

Item 3. AUDIT COMMITTEE FINANCIAL EXPERT.

The registrant's Board of Trustees has determined that the registrant has an audit committee financial expert, as defined in Item 3 of Form N-CSR, serving on its audit committee.

As of the date of this report, September 30, 2017, the registrant's audit committee financial expert is Mr. Vikram Kuriyan, Jr. Mr. Kuriyan is "independent" for purposes of Item 3 of Form N-CSR.

Item 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.

Audit Fees – Audit fees billed for the registrant for the fiscal year ended September 30, 2017 are reflected in the table below. These amounts represent aggregate fees billed by the registrant's independent accountant, Brookweiner, LLC ("Accountant"), in connection with the annual audits of the registrant's financial statements and for services normally provided by the Accountant in connection with the registrant's statutory and regulatory filings.

Forefront Income Trust – 2017 $13,000

(b) Audit-Related Fees – There were no additional fees billed in the fiscal year ended September 30, 2017 for assurance and related services by the Accountant that were reasonably related to the performance of the audit of the registrant's financial statements that were not reported under paragraph (a) of this Item.

(c) Tax Fees – The tax fees billed in the fiscal year ended for September 30, 2017 for professional services rendered by the Accountant for tax compliance, tax advice, and tax planning are reflected in the table below. These services were for the completion of each fund's federal, state, and excise tax returns and assistance with distribution calculations.

Forefront Income Trust – 2017 $2,000

(d) All Other Fees –There were no other fees billed by the Accountant which were not disclosed in Items (a) through (c) above during the fiscal year ended September 30, 2017.

(e)(1) The registrant's Board of Trustees pre-approved the engagement of the Accountant for the last fiscal year at an audit committee meeting of the Board of Trustees called for such purpose and will pre-approve the Accountant for each fiscal year thereafter at an audit committee meeting called for such purpose. The charter of the audit committee states that the audit committee should pre-approve any audit services and, when appropriate, evaluate and pre-approve any non-audit services provided by the Accountant to the registrant and to pre-approve, when appropriate, any non-audit services provided by the Accountant to the registrant's investment adviser, or any entity controlling, controlled by, or under common control with the investment adviser that provides ongoing services to the registrant if the engagement relates directly to the operations and financial reporting of the registrant.

(2) There were no services as described in each of paragraph (b) through (d) of this Item that were approved by the audit committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.

(f) Not Applicable.

(g) There were no non-audit fees billed by the Accountant for services rendered to the registrant's investment adviser, or any other entity controlling, controlled by, or under common control with the registrant's investment adviser.

(h) Not applicable.

Item 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.

Not applicable.

Item 6. SCHEDULE OF INVESTMENTS.

A copy of Schedule I - Investments in securities of unaffiliated issuers as of the close of the reporting period is included as part of the report to shareholders filed under Item 1 of this Form.

Item 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES.

Forefront Capital Advisers, LLC (the "Advisor") has a fiduciary duty to the Forefront Income Trust (the "Trust") to vote proxies in the best interests of the Trust and its shareholders. The Trust invests primarily in certain types of fixed-income securities, and therefore, it is expected that there will be limited circumstances in which the Advisor would be asked to vote the Trust's securities. In such instances, the Advisor has these adopted policies and procedures for voting the Trust's securities.

General Policy

In determining how to vote proxy issues, the Advisor will consider the probable consequences of each issue and vote in a manner designed to protect and enhance the interests of the Trust and its shareholders.

Voting Proxies

Each proxy will be reviewed on a case-by-case basis and in general voted in a way intended to maximize the value of the Trust's particular investment. The Advisor will generally rely on the perspectives of the Trust's portfolio managers, who have a day-to-day perspective with respect to the companies and issuers in which the Trust invests. Therefore, the Trust's portfolio managers will generally be responsible for the Advisor's decisions as to how to cast proxy votes. In certain instances, the Advisory may seek insight and expertise from outside sources as to how a proxy vote may affect the prospects of a particular issuer and vote accordingly.

Certain proxy votes may present a conflict between the interests of the Trust on the one hand and the interests of the Advisor or person affiliated with the Advisor on the other. In such a case, the Advisor will abstain from making a voting decision and may forward proxy voting materials to a third part or parties in order to enable the Trust to cast a vote.

Voting Guidelines

Accountability. The Advisor will generally endeavor to vote proxies in a manner that will reinforce the notion of management's accountability to its board of directors and the board's accountability to its shareholders.

Alignment of Interests. The Advisor believes that each company should endeavor to align the interests of management and the board of directors with the interests of the company's shareholders and that compensation should be designed to reward management for creating value for the shareholders. The Advisor does not support compensation that may be overly dilutive to existing shareholders.

Mergers, Acquisitions and Other Corporate Actions. The Advisor will analyze these proposals from the perspective of the Advisor's investment thesis concerning the company and will vote on a case-by-case basis.

Item 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.

Cole Reifler serves as President, Chief Executive Officer and Secretary. Mr. Reifler’s principal occupations over the last five years include: Forefront Capital Advisors, LLC, Managing Member (Feb 2017-present) Vice President (Jan 2015-Feb 2017); Martel Capital, LLC, Registered Representative, (Sept 2014-Sept 2017); Forefront Capital Markets, Registered Representative (Oct 2014-Aug 2016).

Michael Flatley serves as Chief Financial Officer. Mr. Flatley’s principal occupations over the last five years include: Forefront Capital Advisors, LLC, CFO and Portfolio Manager ([May 2017-present)]; Forefront Global Advisors, LLC (01/2014-present); Michael Flatley, LLC, President and founder (06/2008-01/2014), financial services business providing life insurance annuities and estate planning services.

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 SECURITYHOLDERS.

None.

Item 11. CONTROLS AND PROCEDURES.

(a) The Principal Executive Officer and the Principal Financial Officer have concluded that the registrant's disclosure controls and procedures are effective based on their evaluation of the disclosure controls and procedures as of a date within 90 days of the filing of this report.

(b) There were no changes in the registrant's internal control over financial reporting that occurred during the registrant's second fiscal quarter of the period covered by this report that have materially affected, or are reasonably likely to materially affect, the registrant's internal control over financial reporting.

Item 12. EXHIBITS.

(a)(1) Code of Ethics required by Item 2 of Form N-CSR is filed herewith as Exhibit 12.(a)(1).

(a)(2) Certifications required by Item 12.(a)(2) of Form N-CSR are filed herewith as Exhibit 12.(a)(2).

(a)(3) Not applicable.

(b) Certifications required by Item 12.(b) of Form N-CSR are filed herewith as Exhibit 12.(b).

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.

Forefront Income Trust

By: (Signature and Title)	/s/Cole Reifler
	Cole Reifler
Date: December 7,2017	Principal Executive Officer

By: (Signature and Title)	/s/Michael Flatley
	Michael Flatley
Date: December 7,2017	Principal Financial Officer

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/Cole Reifler
	Cole Reifler
Date: December 7,2017	Principal Executive Officer

By: (Signature and Title)	/s/Michael Flatley
	Michael Flatley
Date: December 7,2017	Principal Financial Officer