As filed with the Securities and Exchange Commission on November 29, 2022

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 811-22842

FORUM FUNDS II

Three Canal Plaza, Suite 600

Portland, Maine 04101

Jessica Chase, Principal Executive Officer

Three Canal Plaza, Suite 600

Portland, Maine 04101

207-347-2000

Date of fiscal year end: September 30

Date of reporting period: October 1, 2021– September 30, 2022

ITEM 1. REPORT TO STOCKHOLDERS.

Annual

Report

September

30,

2022

Advised

by:

SKBA

Capital

Management,

LLC

www.baywoodfunds.com

BAYWOOD

VALUE

PLUS

FUND

A

MESSAGE

TO

OUR

SHAREHOLDERS

(Unaudited)

September

30,

2022

1

Dear

Shareholders,

We

are

pleased

to

report

our

economic

and

financial

market

perspectives

and

the

investment

activities

for

the

Baywood

Value

Plus

Fund

(the

“Fund”)

for

the

fiscal

year

ended

September

30,

2022.

The

Fund

is

a

large

capitalization

value-oriented

portfolio

of

stock

holdings

selected

from

a

universe

of

dividend-paying

companies

traded

on

U.S.

exchanges.

SKBA

attempts

to

identify

candidates

for

purchase

that

appear

to

have

low

expectations

and

pessimism

already

reflected

in

their

current

valuations

by

using

its

Relative

Dividend

Yield

(RDY)

discipline,

which

compares

each

stock’s

yield

history

to

SKBA’s

own

yield

index

of

500

large

dividend-paying

companies.

A

high

RDY

compared

to

a

stock’s

own

history

that

captures

such

pessimism

provides

a

useful

starting

point

for

research

into

each

stock’s

underlying

fundamentals.

The

year

just

ended

has

not

been

kind

to

equity

investors.

Nor

for

that

matter

has

it

been

kind

to

most

asset

classes,

government

bonds,

corporate

bonds,

many

commodities,

even

private

equity,

that

vaunted

asset

class

with

supposedly

uncorrelated

returns.

In

a

year

in

which

the

broad

market

has

declined

meaningfully,

the

value

benchmark

we

have

used

to

compare

ourselves

against

has

held

up

quite

well.

This

benchmark’s

characteristics

are

very

defensive

given

its

high

allocation

to

healthcare,

consumer

staples

and

utilities

whereas

the

Baywood

Value

Plus

fund

has

had

higher

allocations

to

traditionally

cyclical

sectors.

In

spite

of

a

less

defensive

posture,

Value

Plus

bested

our

benchmark

and

declined

half

as

much

over

the

last

year.

This

is

noteworthy

since

value

has

generally

performed

better

than

the

broad

market

recently,

let

alone

growth

funds.

Based

on

the

excesses

we

have

discussed

over

the

last

few

years,

we

have

stated

our

belief

that

active

investment

management

could

outperform

value

benchmarks,

that

value

could

outperform

the

broad

market

and

that

the

broad

market

could

outperform

growth.

This

is

exactly

what

has

taken

place.

At

the

time,

this

observation

was

not

so

much

prescient

as

simply

recognizing

the

few

factors

driving

so

much

of

the

equity

universe

and

the

significant

holdings

overlap

between

supposedly

different

investment

styles.

In

essence,

the

stock

rally

over

the

last

decade

that

ended

last

year

is

not

so

different

from

preceding

ones

in

that

it

suffered

from

herding

into

fewer

and

fewer

securities.

This

phenomenon

counterintuitively

resulted

in

a

broader

universe

for

those

few

of

us

remaining

that

espouse

Active

and

Value

investment

management.

We

have

also

expressed

concerns

that

traditionally

defensive

sectors

did

not

always

appear

to

be

priced

as

such.

Many

utilities,

consumer

staples

and

REIT’s

have

in

our

opinion

possessed

mediocre

fundamentals.

Despite

such

lackluster

business

economics,

their

stocks

have

been

richly

valued.

As

such,

in

a

broad

market

downturn,

our

belief

was

and

remains

that

they

might

not

provide

similar

downside

protection

as

they

had

been

known

for

historically

under

similar

circumstances.

On

the

other

hand,

energy

and

basic

materials

had

not

simply

been

ignored

or

neglected;

such

stocks

had

been

actively

eliminated

from

most

global

benchmarks,

whether

it

be

the

S&P

500,

any

growth

index

of

course,

as

well

as

global

indices

such

as

the

MSCI

World

index.

When

there

is

such

virulent

opposition

to

owning

anything

within

a

given

sector,

is

that

not

i

llus

trative

of

a

bottom

having

been

reached?

It

had

at

every

point

in

the

past,

why

would

it

not

this

time?

We

did

not

have

to

make

outlandish

return

assumptions

to

discover

unbelievable

values

within

such

despised

sectors

over

the

last

few

years.

As

a

result,

the

recent

downturn

has

been

very

different

from

past

ones

in

the

sense

that

traditionally

cyclical

sectors

have

been

among

the

best

performers.

We

are

pleased

to

have

found

such

investments

and

continue

to

see

significant

upside

in

what

remain

mostly

ignored

industries.

Performance

attribution

says

little

about

absolute

returns.

Rather,

it

is

viewed

relative

to

some

chosen

benchmark.

For

the

fiscal

year

ended

September

30,

2022,

our

exposure,

or

lack

thereof,

to

healthcare,

utilities

and

consumer

staples

detracted

from

relative

returns.

In

all

three,

sector

allocation,

not

stock

selection

was

the

primary

culprit.

This

speaks

to

the

Value

component

of

the

strategy.

In

other

words,

had

we

had

greater

exposure

to

these

sectors

which

declined

less

than

others,

the

strategy

would

have

performed

even

better.

Over

the

entire

year,

some

of

the

largest

individual

detractors

included

Kontoor

Brands,

Kinder

Morgan,

Philips66

and

Viatris.

Other

poor

performers

included

Comcast,

Verizon,

Citigroup,

Medtronic

and

NetApp.

On

the

other

hand,

our

exposure

to

financials,

energy,

industrials,

information

technology,

materials

and

real

estate

contributed

to

overall

relative

returns.

For

most

of

these

exposures,

stock

selection,

not

sector

allocation,

was

responsible

for

the

majority

of

overall

contribution.

This

speaks

to

the

Active

component

of

the

strategy.

The

largest

contributors

by

far

was

Nutrien,

followed

by

Chubb,

Met

Life,

Genuine

Parts,

Vici

Properties,

AIG

and

Realty

Income.

Some

of

the

initiated

positions

during

the

year

include

Darden

Restaurants,

MolsonCoors,

Radian

and

Wells

Fargo.

Vereit

was

converted

into

Realty

Income

following

its

acquisition

and

we

are

pleased

to

continue

to

own

the

latter’s

shares

based

on

its

competitive

position

and

consistent

return

to

shareholders.

We

eliminated

Verizon

in

preference

for

AT&T,

Westrock

in

preference

for

Packaging

Corp,

WalMart,

Ameriprise,

First

American

Financial,

3M

and

Manpower.

We

would

consider

WalMart,

Ameriprise

and

FAF

to

all

have

been

successful

investments

while

Manpower,

Westrock,

3M

and

Verizon

were

disappointing

over

our

holding

period.

BAYWOOD

VALUE

PLUS

FUND

A

MESSAGE

TO

OUR

SHAREHOLDERS

(Unaudited)

September

30,

2022

2

As

we

look

out

over

the

next

year

and

longer,

we

do

not

expect

recent

poor

market

returns

to

continue.

Nor,

however,

do

we

expect

them

to

return

to

the

recent

past

of

double

digit

annual

rates.

We

still

believe

that

average

investor

expectations

need

to

be

reset

lower.

While

year

to

year

returns

should

be

expected

to

fluctuate,

perhaps

wildly,

when

all

is

said

and

done,

being

able

to

achieve

a

modest

real

rate

of

return

–

net

of

inflation,

thereby

creating

real

wealth

over

time

–

will

be

quite

an

accomplishment.

Baywood

Value

Plus

’

characteristics

are

such

that

we

should

be

able

to

capture

a

greater

proportion

of

overall

returns

up

front

which

means

prior

to

the

erosion

from

inflationary

forces.

The

companies

we

purchase

have

a

higher

proportion

of

earnings

to

their

stock

prices

(the

inverse

of

P/E’s

using

a

residual

wealth

inflationary

lens)

and

in

addition

distribute

a

significant

portion

of

those

earnings

in

the

form

of

dividends.

This

has

historically

proven

to

be

a

sound

strategy

in

choppy

environments

where

the

alternative

is

to

hope

for

yet

higher

multiples

from

already

elevated

levels.

Current

and

future

portfolio

holdings

are

subject

to

change

and

risk.

Please

see

the

schedule

of

investments

section

in

this

report

for

a

full

listing

of

the

Fund’s

holdings

The

Morningstar

category

is

used

to

compare

fund

performance

to

its

peers.

It

is

not

possible

to

invest

directly

into

an

index

or

category.

Past

performance

is

no

guarantee

of

future

results.

Diversification

does

not

assure

a

profit,

nor

does

it

protect

against

a

loss

in

a

declining

market

Risk

Considerations:

Mutual

fund

investing

involves

risk,

including

the

possible

loss

of

principal.

The

Fund

primarily

invests

in

undervalued

securities,

which

may

not

appreciate

in

value

as

anticipated

by

the

Advisor

or

remain

undervalued

for

longer

than

anticipated.

The

Fund

may

invest

in

American

Depositary

Receipts

(ADRs),

which

involves

risks

relating

to

political,

economic

or

regulatory

conditions

in

foreign

countries

and

may

cause

greater

volatility

and

less

liquidity.

The

Fund

may

also

invest

in

convertible

securities

and

preferred

stock,

which

may

be

adversely

affected

as

interest

rates

rise.

BAYWOOD

VALUE

PLUS

FUND

PERFORMANCE

CHART

AND

ANALYSIS

(Unuadited)

September

30,

2022

3

The

following

chart

reflects

the

change

in

the

value

of

a

hypothetical

$10,000

investment,

including

reinvested

dividends

and

distributions,

in

the

Baywood

Value

Plus

Fund

(the

“Fund”)

compared

with

the

performance

of

the

benchmark,

Morningstar

US

Large

Value

TR

Index,

since

inception.

The

Morningstar

US

Large

Value

TR

Index

measures

the

performance

of

large-cap

stocks

with

relatively

low

prices

given

anticipated

per

share

earnings,

book

value,

cash

flow,

sales

and

dividends.

The

total

return

of

the

index

includes

the

reinvestment

of

dividends

and

income.

The

total

return

of

the

Fund

includes

operating

expenses

that

reduce

returns,

while

the

total

return

of

the

index

does

not

include

expenses.

The

Fund

is

professionally

managed,

while

the

index

is

unmanaged

and

is

not

available

for

investment.

Comparison

of

Change

in

Value

of

a

$10,000

Investment

Baywood

Value

Plus

Fund

vs.

Morningstar

US

Large

Value

TR

Index

Performance

data

quoted

represents

past

performance

and

is

no

guarantee

of

future

results.

Current

performance

may

be

lower

or

higher

than

the

performance

data

quoted.

Investment

return

and

principal

value

will

fluctuate

so

that

shares,

when

redeemed,

may

be

worth

more

or

less

than

original

cost.

For

the

most

recent

month-end

performance,

please

call

(855)

409-2297.

As

stated

in

the

Fund’s

prospectus,

the

annual

operating

expense

ratio

(gross)

is

5.66%.

However,

the

Fund’s

advisor has

contractually

agreed

to

waive

its

fee

and/or

reimburse

Fund

expenses

to

limit

Total

Annual

Fund

Operating

Expenses

After

Fee

Waiver

and/or

Expense

Reimbursement

(excluding

all

taxes,

interest,

portfolio

transaction

expenses,

acquired

fund

fees

and

expenses,

proxy

expenses

and

extraordinary

expenses)

to

0.70%,

through

January

31,

2023

(the

“Expense

Cap”).

The

Expense

Cap

may

be

raised

or

eliminated

only

with

the

consent

of

the

Board

of

Trustees.

The

Advisor

may

be

reimbursed

by

the

Fund

for

fees

waived

and

expenses

reimbursed

by

the

Advisor

pursuant

to

the

Expense

Cap

if

such

payment

is

made

within

three

years

of

the

fee

waiver

or

expense

reimbursement,

and

does

not

cause

the

Total

Annual

Fund

Operating

Expenses

After

Fee

Waiver

and/or

Expense

Reimbursement

to

exceed

the

lesser

of

(i)

the

then-current

expense

cap,

or

(ii)

the

expense

cap

in

place

at

the

time

the

fees/expenses

were

waived/reimbursed.

Total

Annual

Fund

Operating

Expenses

After

Fee

Waiver

and/or

Expense

Reimbursement

will

increase

if

exclusions

from

the

Expense

Cap

apply.

During

the

year,

certain

fees

were

waived

and/or

expenses

reimbursed;

otherwise,

returns

would

have

been

lower.

The

performance

table

and

graph

do

not

reflect

the

deduction

of

taxes

that

a

shareholder

would

pay

on

Fund

distributions

or

the

redemption

of

Fund

shares.

Returns

greater

than

one

year

are

annualized.

Average

Annual

Total

Returns

Periods

Ended

September

30,

2022

One

Year

Five

Year

Ten

Year

Since

Inception

06/27/08*

Baywood

Value

Plus

Fund

-4.16%

5.80%

8.75%

8.32%

Morningstar

US

Large

Value

TR

Index

-6.67%

5.70%

8.86%

7.13%

*

The

Fund’s

Institutional

Shares

performance

for

periods

prior

to

the

commencement

of

operations

(12/2/13)

is

that

of

a

collective

investment

trust

managed

by

the

Fund’s

Advisor

and

portfolio

management

team.

The

Institutional

Shares

of

the

collective

investment

trust

commenced

operations

on

June

27,

2008.

BAYWOOD

VALUE

PLUS

FUND

SCHEDULE

OF

INVESTMENTS

September

30,

2022

4

See

Notes

to

Financial

Statements.

The

following

is

a

summary

of

the

inputs

used

to

value

the

Fund's instruments

as

of

September

30,

2022. 

The

inputs

or

methodology

used

for

valuing

securities

are

not

necessarily

an

indication

of

the

risks

associated

with

investing

in

those

securities.

For

more

information

on

valuation

inputs,

and

their

aggregation

into

the

levels

used

in

the

table

below,

please

refer

to

the

Security

Valuation

section

in

Note

2

of

the

accompanying

Notes

to

Financial

Statements.

The

Level

1

value

displayed

in

this

table

is

Common

Stock.

The

Level

2

value

displayed

in

this

table

is

a

Money

Market

Fund.

Refer

to

this

Schedule

of

Investments

for

a

further

breakout

of

each

security

by

industry.

Shares

Security

Description

Value

Common

Stock

-

94.2%

Basic

Materials

-

8.2%

1,600‌

Newmont

Corp.

$

67,248‌

1,260‌

Nutrien,

Ltd.

105,059‌

300‌

Packaging

Corp.

of

America

33,687‌

1,100‌

Rio

Tinto

PLC,

ADR

60,566‌

266,560‌

Capital

Goods

/

Industrials

-

4.8%

200‌

Parker-Hannifin

Corp.

48,462‌

1,300‌

Raytheon

Technologies

Corp.

106,418‌

154,880‌

Communication

Services

-

5.4%

7,900‌

AT&T,

Inc.

121,186‌

1,800‌

Comcast

Corp.,

Class A

52,794‌

173,980‌

Consumer

Discretionary

-

7.6%

500‌

Darden

Restaurants,

Inc.

63,160‌

400‌

Genuine

Parts

Co.

59,728‌

2,200‌

Kontoor

Brands,

Inc.

73,942‌

400‌

Lear

Corp.

47,876‌

244,706‌

Consumer

Staples

-

5.8%

600‌

Ingredion,

Inc.

48,312‌

910‌

Molson

Coors

Beverage

Co.,

Class B

43,671‌

200‌

PepsiCo.,

Inc.

32,652‌

1,900‌

The

Kraft

Heinz

Co.

63,365‌

188,000‌

Energy

-

11.3%

300‌

Chevron

Corp.

43,101‌

1,300‌

ConocoPhillips

133,042‌

2,100‌

Equinor

ASA,

ADR

69,531‌

3,800‌

Kinder

Morgan,

Inc.

63,232‌

700‌

Phillips

66

56,504‌

365,410‌

Financials

-

18.7%

2,400‌

American

International

Group,

Inc.

113,952‌

500‌

Chubb,

Ltd.

90,940‌

1,800‌

Citigroup,

Inc.

75,006‌

200‌

CME

Group,

Inc.

35,426‌

1,600‌

MetLife,

Inc.

97,248‌

300‌

Northern

Trust

Corp.

25,668‌

1,000‌

Prosperity

Bancshares,

Inc.

66,680‌

2,300‌

Radian

Group,

Inc.

44,367‌

1,400‌

Wells

Fargo

&

Co.

56,308‌

605,595‌

Health

Care

-

12.4%

600‌

AbbVie,

Inc.

80,526‌

300‌

Amgen,

Inc.

67,620‌

500‌

AstraZeneca

PLC,

ADR

27,420‌

1,100‌

Cardinal

Health,

Inc.

73,348‌

16‌

Koninklijke

Philips

NV,

ADR

246‌

600‌

Medtronic

PLC

48,450‌

1,200‌

Merck

&

Co.,

Inc.

103,344‌

400,954‌

Real

Estate

-

3.8%

904‌

Realty

Income

Corp.

REIT

52,613‌

2,400‌

VICI

Properties,

Inc.

REIT

71,640‌

124,253‌

Technology

-

11.4%

1,100‌

Cisco

Systems,

Inc.

44,000‌

1,200‌

Corning,

Inc.

34,824‌

800‌

International

Business

Machines

Corp.

95,048‌

1,300‌

NetApp,

Inc.

80,405‌

600‌

TE

Connectivity,

Ltd.

66,216‌

Shares

Security

Description

Value

Technology

-

11.4%

(continued)

300‌

Texas

Instruments,

Inc.

$

46,434‌

366,927‌

Transportation

-

3.7%

5,800‌

Atlas

Corp.

80,620‌

200‌

Union

Pacific

Corp.

38,964‌

119,584‌

Utilities

-

1.1%

1,000‌

OGE

Energy

Corp.

36,460‌

Total

Common

Stock

(Cost

$2,683,883)

3,047,309‌

Shares

Security

Description

Value

Money

Market

Fund

-

6.0%

192,269‌

First

American

Government

Obligations

Fund,

Class X,

2.78% 

(a)

(Cost

$192,269)

192,269‌

Investments,

at

value

-

100.2%

(Cost

$2,876,152)

$

3,239,578‌

Other

Assets

&

Liabilities,

Net

-

(0.2)%

(5,618‌)

Net

Assets

-

100.0%

$

3,233,960‌

ADR

American

Depositary

Receipt

PLC

Public

Limited

Company

REIT

Real

Estate

Investment

Trust

(a)

Dividend

yield

changes

daily

to

reflect

current

market

conditions.

Rate

was

the

quoted

yield

as

of

September

30,

2022.

Valuation

Inputs

Investments

in

Securities

Level

1

-

Quoted

Prices

$

3,047,309‌

Level

2

-

Other

Significant

Observable

Inputs

192,269‌

Level

3

-

Significant

Unobservable

Inputs

–‌

Total

$

3,239,578‌

BAYWOOD

VALUE

PLUS

FUND

SCHEDULE

OF

INVESTMENTS

September

30,

2022

5

See

Notes

to

Financial

Statements.

PORTFOLIO

HOLDINGS

(Unaudited)

%

of

Total

Investments

Basic

Materials

8.2%‌

Capital

Goods

/

Industrials

4.8%‌

Communication

Services

5.4%‌

Consumer

Discretionary

7.6%‌

Consumer

Staples

5.8%‌

Energy

11.3%‌

Financials

18.7%‌

Health

Care

12.4%‌

Real

Estate

3.8%‌

Technology

11.3%‌

Transportation

3.7%‌

Utilities

1.1%‌

Money

Market

Fund

5.9%‌

100.0%‌

BAYWOOD

VALUE

PLUS

FUND

STATEMENT

OF

ASSETS

AND

LIABILITIES

September

30,

2022

6

See

Notes

to

Financial

Statements.

ASSETS

Investments,

at

value

(Cost

$2,876,152)

$

3,239,578‌

Receivables:

Fund

shares

sold

1,775‌

Dividends

8,019‌

From

investment

advisor

6,178‌

Prepaid

expenses

10,742‌

Total

Assets

3,266,292‌

LIABILITIES

Accrued

Liabilities:

Fund

services

fees

4,660‌

Other

expenses

27,672‌

Total

Liabilities

32,332‌

NET

ASSETS

$

3,233,960‌

COMPONENTS

OF

NET

ASSETS

Paid-in

capital

$

2,785,828‌

Distributable

Earnings

448,132‌

NET

ASSETS

$

3,233,960‌

SHARES

OF

BENEFICIAL

INTEREST

AT

NO

PAR

VALUE

(UNLIMITED

SHARES

AUTHORIZED)

186,830‌

NET

ASSET

VALUE,

OFFERING

AND

REDEMPTION

PRICE

PER

SHARE

$

17.31‌

BAYWOOD

VALUE

PLUS

FUND

STATEMENT

OF

OPERATIONS

FOR

THE

YEAR

ENDED

SEPTEMBER

30,

2022

7

See

Notes

to

Financial

Statements.

INVESTMENT

INCOME

Dividend

income

(Net

of

foreign

withholding

taxes

of

$948)

$

123,486‌

Total

Investment

Income

123,486‌

EXPENSES

Investment

advisor

fees

17,791‌

Fund

services

fees

58,226‌

Transfer

agent

fees

18,480‌

Custodian

fees

5,000‌

Registration

fees

21,989‌

Professional

fees

28,783‌

Trustees'

fees

and

expenses

4,629‌

Other

expenses

29,658‌

Total

Expenses

184,556‌

Fees

waived

and

expenses

reimbursed

(159,649‌)

Net

Expenses

24,907‌

NET

INVESTMENT

INCOME

98,579‌

NET

REALIZED

AND

UNREALIZED

GAIN

(LOSS)

Net

realized

gain

on

investments

68,555‌

Net

change

in

unrealized

appreciation

(depreciation)

on

investments

(307,103‌)

NET

REALIZED

AND

UNREALIZED

LOSS

(238,548‌)

DECREASE

IN

NET

ASSETS

RESULTING

FROM

OPERATIONS

$

(139,969‌)

BAYWOOD

VALUE

PLUS

FUND

STATEMENTS

OF

CHANGES

IN

NET

ASSETS

8

See

Notes

to

Financial

Statements.

For

the

Years

Ended

September

30,

2022

2021

OPERATIONS

Net

investment

income

$

98,579‌

$

78,386‌

Net

realized

gain

68,555‌

281,849‌

Net

change

in

unrealized

appreciation

(depreciation)

(307,103‌)

592,957‌

Increase

(Decrease)

in

Net

Assets

Resulting

from

Operations

(139,969‌)

953,192‌

DISTRIBUTIONS

TO

SHAREHOLDERS

Total

Distributions

Paid

(347,363‌)

(71,909‌)

CAPITAL

SHARE

TRANSACTIONS

Sale

of

shares

64,886‌

97,772‌

Reinvestment

of

distributions

344,811‌

71,883‌

Redemption

of

shares

(76,973‌)

(250,617‌)

Increase

(Decrease)

in

Net

Assets

from

Capital

Share

Transactions

332,724‌

(80,962‌)

Increase

(Decrease)

in

Net

Assets

(154,608‌)

800,321‌

NET

ASSETS

Beginning

of

Year

3,388,568‌

2,588,247‌

End

of

Year

$

3,233,960‌

$

3,388,568‌

SHARE

TRANSACTIONS

Sale

of

shares

3,282‌

5,147‌

Reinvestment

of

distributions

18,232‌

3,675‌

Redemption

of

shares

(3,832‌)

(12,688‌)

Increase

(Decrease)

in

Shares

17,682‌

(3,866‌)

BAYWOOD

VALUE

PLUS

FUND

FINANCIAL

HIGHLIGHTS

9

See

Notes

to

Financial

Statements.

These

financial

highlights

reflect

selected

data

for

a

share

outstanding

throughout

each

year.

For

the

Years

Ended

September

30,

2022

2021

2020

2019

2018

INSTITUTIONAL

SHARES

NET

ASSET

VALUE,

Beginning

of

Year

$

20.03‌

$

14.96‌

$

17.03‌

$

18.63‌

$

17.36‌

INVESTMENT

OPERATIONS

Net

investment

income

(a)

0.55‌

0.45‌

0.39‌

0.44‌

0.38‌

Net

realized

and

unrealized

gain

(loss)

(1.26‌)

5.04‌

(1.86‌)

(0.84‌)

1.76‌

Total

from

Investment

Operations

(0.71‌)

5.49‌

(1.47‌)

(0.40‌)

2.14‌

DISTRIBUTIONS

TO

SHAREHOLDERS

FROM

Net

investment

income

(0.49‌)

(0.42‌)

(0.38‌)

(0.39‌)

(0.35‌)

Net

realized

gain

(1.52‌)

–‌

(0.22‌)

(0.81‌)

(0.52‌)

Total

Distributions

to

Shareholders

(2.01‌)

(0.42‌)

(0.60‌)

(1.20‌)

(0.87‌)

NET

ASSET

VALUE,

End

of

Year

$

17.31‌

$

20.03‌

$

14.96‌

$

17.03‌

$

18.63‌

TOTAL

RETURN

(4.16‌)%

36.80‌%

(8.77‌)%

(1.55‌)%

12.57‌%

RATIOS/SUPPLEMENTARY

DATA

Net

Assets

at

End

of

Year

(000s

omitted)

$

3,234‌

$

3,389‌

$

2,588‌

$

2,802‌

$

936‌

Ratios

to

Average

Net

Assets:

Net

investment

income

2.77‌%

2.39‌%

2.51‌%

2.66‌%

2.10‌%

Net

expenses

0.70‌%

0.70‌%

0.70‌%

0.70‌%

0.70‌%

Gross

expenses

(b)

5.19‌%

5.66‌%

6.68‌%

8.13‌%

8.83‌%

PORTFOLIO

TURNOVER

RATE

48‌%

35‌%

40‌%

49‌%

34‌%

(a)

Calculated

based

on

average

shares

outstanding

during

each

year.

(b)

Reflects

the

expense

ratio

excluding

any

waivers

and/or

reimbursements.

BAYWOOD

SOCIALLY

RESPONSIBLE

FUND

A

MESSAGE

TO

OUR

SHAREHOLDERS

(Unaudited)

September

30,

2022

10

Dear

Shareholder,

We

are

pleased

to

report

our

economic

and

financial

market

perspectives

and

the

investment

activities

for

the

Baywood

Socially

Responsible

Fund

(the

“Fund”)

for

the

twelve

months

ended

September

30,

2022.

The

Fund

is

a

mid-to-large

capitalization

value-oriented

portfolio

of

stock

holdings

selected

from

a

universe

created

through

the

application

of

inclusionary

and

exclusionary

social

screens

and

assessments

of

the

ESG

profile

of

each

company.

Among

these

stocks,

we

further

evaluate

and

assess

each

prospective

holding’s

valuation

and

fundamental

business

attraction

to

determine

the

current

portfolio

holdings.

In

selecting

investments,

we

consider

social

criteria

such

as

an

issuer’s

community

relations,

corporate

governance,

employee

diversity,

employee

relations,

environmental

impact

and

sustainability,

human

rights

record

and

product

safety.

Reflecting

back

on

the

past

two

plus

years

can

be

daunting

considering

how

much

the

world

has

changed

in

that

time

period.

The

way

in

which

we

even

speak

about

the

past

has

changed;

we

now

collectively

refer

to

the

period

before

March

2020

as

pre-pandemic,

marking

a

new

era

of

sorts

for

the

period

after.

Defining

when

the

“post-pandemic”

period

began

(or

will

begin)

is

a

bit

trickier,

which

could

be

different

depending

on

location

and

other

factors,

like

politics

and

individual

perspective;

however,

we

can

all

agree

that

the

world

we

live

in

now

is

vastly

different

than

the

one

prior

to

2020.

Portfolio

positioning

perspectives

are

vastly

different

as

well.

Given

the

overvaluation

of

much

of

the

stock

and

bond

market

late

last

year,

our

willingness

not

to

chase

performance

proved

beneficial

as

the

portfolio

declined

much

less

than

the

Morningstar

benchmark

and

most

other

market

indices

in

the

period.

The

Baywood

Socially

Responsible

Fund

declined

approximately

6.6%,

while

the

Morningstar

Large

Cap

Value,

Russell

1000

Value

and

S&P

500

declined

6.7%,

11.2%

and

16.8%

respectively.

First,

the

pandemic

was

an

attack

on

our

consciousness,

as

we

all

had

to

adapt

to

the

strange

new

world

of

mask-wearing,

curfews,

limited

store

hours

and

store

items.

Most

of

us

took

the

time

to

reconsider

our

health,

knowing

this

was

a

disease

that

killed

the

less

fortunate

and

less

healthy.

Many

of

us

lost

loved

ones

to

this

new

and

seemingly

strange

disease.

Then

came

the

economic

consequences

of

government

responses

to

bend

the

curve

and

ease

the

strain

on

hospitals.

The

total

shut-down

of

the

global

economy

carried

some

unique

repercussions

that

we

still

see

in

our

daily

lives.

The

government

response

to

print

and

deliver

money

to

every

citizen

was

also

not

without

consequence.

Even

our

recreational

choices

changed;

RVs

and

camping

gear

were

the

two

leading

consumer

discretionary

industries

in

2020

and

2021.

Supply

chains

were

hammered

as

companies

realized

you

couldn’t

just

start

and

stop

production

on

a

dime

in

a

world

that

had

become

highly

dependent

on

global

trade.

Not

to

mention

all

of

the

supply

constraints

brought

about

by

the

shortage

of

labor

due

to

lockdowns

and

sickness.

Automobile

production,

for

example,

which

was

shut

down

for

more

than

three

months

in

2020

and

severely

constrained

by

the

semiconductor

shortage

afterwards

has

yet

to

fully

recover,

thus

contributing

to

the

massive

spike

in

prices

of

new

and

used

vehicles.

In

fact,

if

you

purchased

a

new

car

in

the

last

2-3

years,

there’s

a

good

chance

that

vehicle

is

worth

more

than

what

you

paid

for

it.

Labor

shortages,

partly

due

to

a

wave

of

retirements,

have

led

to

significant

wage

increases,

the

likes

of

which

haven’t

been

seen

in

decades.

Furthermore,

a

large

number

of

firms

have

realized

that

they

no

longer

need

to

take

an

“all-hands-on-deck”

approach

to

a

work

environment

and,

in

conjunction

with

the

leverage

laborers

can

now

exert,

is

reshaping

how

often

workers

are

needed

in

an

office

setting.

One

more

factor

that

has

changed

since

the

pandemic

began

is

consolidation.

Just

think

of

the

many

restaurants

and

retail

locations

that

have

closed

or

shutdown

since

March

of

2020.

In

energy,

consolidation

accelerated

as

did

the

bankruptcies.

With

consolidation

often

comes

price

discipline

as

there

are

fewer

companies

competing

on

price,

which

also

leads

to,

if

not

outright

price

increases,

then

at

least

the

cessation

of

irrational

competitive

pricing

tactics

(price

declines).

Most

of

these

are

also

contributing

factors

to

one

of

the

biggest

issues

the

U.S.

has

had

to

face

in

over

40

years:

Price

Inflation.

After

nearly

40

years

of

declining

inflation,

many

Americans

find

themselves

dealing

with

unprecedented

price

increases

for

the

first

time

in

their

lives.

Anyone

forty

or

younger

has

yet

to

deal

with

inflation

of

this

magnitude

over

their

lifespan.

Higher

inflation

has

also

ended

the

40-year

bull-market

in

bonds

as

the

Federal

Reserve

now

has

a

serious

problem

to

contend

with

and

does

not

have

the

ability

to

kowtow

to

political

pressure

to

keep

rates

(and

thus

government

borrowing

cost)

low.

Furthermore,

inflation

eats

away

at

the

value

of

fixed

payments

(like

bonds)

and

investors

tend

to

prefer

investments

that

can

appreciate

in

an

inflationary

environment,

which

has

led

to

further

pressure

for

increasing

bond

yields.

And

thus,

for

investors,

we

find

ourselves

in

a

landscape

that

is

very

different

from

the

one

in

which

we

were

in

just

two

short

years

ago.

What

we’ve

seen

so

far

in

2022

is

that

the

markets

are

now

reacting

to

this

new

reality

of

higher

interest

rates

and

higher

inflation

and

has

shown

a

preference

for

shorter-dated

assets

with

upfront

dividend

payments

(with

the

ability

to

grow

with

inflation),

reversing

the

trends

we’ve

witnessed

in

the

markets

throughout

most

of

the

2010s

and

early

2020s.

Growth

stocks

are

now

at

the

beginning

of

what

we

believe

will

be

a

prolonged

correction

in

valuations.

BAYWOOD

SOCIALLY

RESPONSIBLE

FUND

A

MESSAGE

TO

OUR

SHAREHOLDERS

(Unaudited)

September

30,

2022

11

Having

previously

pointed

out

the

excess

valuations

and

concentration

within

the

indices

to

these

mega-cap

growth

stocks,

we

won’t

belabor

the

details

in

this

annual

letter.

Suffice

to

say,

we

have

seen

this

coming

for

years,

though

at

times,

interrupted

by

the

pandemic.

Furthermore,

as

it

relates

to

ESG

and

Socially

Responsible

investments,

there

is

also

a

concentration

in

the

number

of

funds

available

to

the

community

towards

growth

stocks.

Or,

in

other

words,

there

are

very

limited

options

to

diversify

away

from

concentration

in

the

highly

valued

growth

sector

for

ESG

related

strategies.

Which

is

one

reason

we

are

more

than

pleased

with

the

SociallyReponsible

fund’s

better

than

benchmark

returns

for

the

year

ended

September

30,

2022.

To

put

this

in

context,

we

would

like

to

revisit

what

has

happened

in

markets

since

the

pandemic

began.

In

early

2020,

when

the

global

economy

was

in

the

process

of

shutting

down,

markets

sold

off.

But

not

all

sell-offs

are

created

equal.

This

one

was

very

unusual

in

that

the

stocks

with

the

lowest

P/E’s

declined

the

most,

while

the

best

performing

stocks

with

the

highest

P/E’s

and

highest

market

capitalizations

held

up

the

best.

We

said

this

at

the

time,

and

will

reiterate

it

now,

we

believed

the

panic

sell-off

that

occurred

was

one

of

the

best

buying

opportunities

for

Value

stocks

in

decades.

Our

relative

returns

against

our

benchmarks

since

the

first

quarter

of

2020

has

reinforced

our

thoughts

and

vindicated

our

actions

to

buy

when

the

rest

of

the

market

was

selling.

We

didn’t

buy

indiscriminately,

however.

We

purchased

stocks

that

we

had

long

wanted

to

own

but

hadn’t

due

to

elevated

valuations.

Since

then

we

have

been

selling

companies

whose

valuations

increased

beyond

our

expectations

and

buying

more

of

the

companies

whose

valuations

have

continued

to

deteriorate.

For

the

period,

our

holdings

in

financials,

industrials

and

basic

materials

contributed

the

most

to

returns.

In

basic

materials,

Nutrien

and

Steel

Dynamics

contributed

the

most

to

performance

as

both

inflation

beneficiaries,

and

as

undervalued

investments

for

years

with

solid

underlying

fundamental

thesis’

returned

32%

and

47%

respectively.

We

have

owned

Nutrien

for

years

and

are

now

being

rewarded

for

our

patience.

Steel

Dynamics

was

added

to

the

portfolio

during

the

pandemic

when

the

global

economy

was

at

a

stand-still.

While

most

would

agree—with

the

benefit

of

hindsight

of

course—it

wasn’t

likely

that

we

were

going

to

stay

“locked

up”

forever,

the

market

behaved

as

if

we

would.

Our

investments

in

both

of

these

companies,

which

span

a

period

longer

than

the

fiscal

year,

have

more

than

doubled

in

a

very

short

period

of

time,

aiding

returns

for

our

holding

periods.

In

the

industrial

sector,

our

holdings

in

Atlas

and

nVent

contributed

most

to

returns.

Atlas

modestly

declined

in

the

overall

period,

but

increased

30%

in

the

third

quarter

of

2022

due

to

a

“go

private”

offer

from

management.

This

offer

significantly

undervalues

the

intrinsic

value

of

the

company

and

as

such

we

are

not

particularly

hopeful

that

the

deal

will

close.

We

will

be

content

to

remain

owners

as

the

stock

price

grows

into

its

fair

value

over

time.

Our

suggestion

is

for

Atlas’

management

to

take

care

of

business

instead

of

distracting

itself

attempting

to

go

private.

In

the

financial

sector,

the

benchmark’s

returns

were

dragged

down

by

the

negative

returns

of

the

largest

banks.

Banks

rallied

over

the

previous

year

as

increased

interest

rates

improved

net

investment

margins

(NIM’s),

but

turned

mostly

negative

in

the

period

as

perhaps

a

sign

that

the

market

perhaps

hastily

awarded

these

companies

higher

valuations.

We

have

also

not

been

very

attracted

to

most

traditional

banks,

as

it

seems

that

an

improvement

in

net

investment

margins

were

one

of

the

only

ways

in

which

a

bank

can

improve

profitability.

Especially

considering

that

larger

money

centers

like

JP

Morgan

and

Goldman

Sachs

had

made

so

much

money

from

SPAC

boom

over

the

last

few

years,

which

we

felt

was

not

likely

to

continue

and

would

offset

some

of

the

benefit

of

an

increase

in

NIM’s.

Instead

we

have

preferred

property

and

casualty

insurance

(AIG

and

Chubb)

and

industrial

conglomerates

(Brookfield

Asset

Management

and

Berkshire

Hathaway)

which

helped

aid

returns

over

the

benchmark.

Offsetting

some

of

the

positive

relative

performance

from

these

sectors

were

our

holdings

in

health

care

and

communication

services.

In

healthcare,

our

holdings

were

mostly

flat,

while

the

benchmark’s

increased

approximately

7%.

LabCorp,

Medtronic

and

Koninklijke

Philips

all

declined

more

than

25%

in

the

period,

which

was

partially

offset

by

strong

performance

from

Cardinal

Health.

LabCorp’s

decline

can

be

attributed

to

a

smaller

number

of

Covid

tests

being

performed

in

its

clinics.

We

do

not

believe

anything

about

its

business

is

permanently

impaired

and

perhaps

the

market

is

focusing

too

much

on

the

boom

and

bust

nature

of

Covid

testing

and

not

enough

on

the

underlying

fundamentals,

which

are

still

very

attractive.

The

major

price

declines

in

these

stocks

has

us

more

attracted

to

them,

not

less.

We

will

likely

be

adding

to

a

number

of

these

companies

in

the

near

future.

Over

the

last

couple

of

years,

the

communication

services

sector

has

been

redefined

to

include

former

highflyers

including

Google/

Alphabet

and

Facebook/Meta.

As

Meta

has

lost

nearly

two

thirds

of

its

value

since

late

last

year,

it

is

not

surprising

that

a

decline

of

such

a

magnitude

in

one

of

the

formerly

largest

capitalization

companies

would

have

a

negative

impact

on

the

sector

as

a

whole.

We

do

not

own

Meta

nor

do

we

own

Alphabet.

Our

holdings,

AT&T,

Disney,

Verizon

and

Comcast

did

not

escape

the

carnage,

however.

Yet,

in

times

of

uncertainty,

consumers

rarely

cut

off

their

cable

and

phone

services

and

any

family

member

will

tell

you

how

hard

it

is

to

cut

Disney

out

of

its

household.

We

find

solace

in

owning

these

businesses

at

such

attractive

valuations

and

elevated

dividend

yields,

BAYWOOD

SOCIALLY

RESPONSIBLE

FUND

A

MESSAGE

TO

OUR

SHAREHOLDERS

(Unaudited)

September

30,

2022

12

dividends

which

are

very

unlikely

to

be

cut

and

will

therefore

compound

into

our

total

returns.

Our

timely

exit

from

Verizon

in

the

period

aided

returns

as

our

holding

period

resulted

in

a

decline

of

“only”

12%.

During

the

period

we

added

Citigroup,

AT&T,

Merck

and

Newmont.

We

eliminated

Verizon

and

added

AT&T

as

the

latter

has

a

much

better

valuation

as

it

refocuses

on

its

core

business

and

divested

its

satellite

and

content

business.

Merck’s

pipeline

continues

to

grow,

while

the

market

has

still

mostly

written

the

company

off.

In

addition,

very

little

value

is

being

placed

on

its

animal

care

business,

companion

and

stock,

which

rivals

its

largest

public

peer

in

size.

We

are

both

attracted

to

its

fundamentals

and

its

valuation

and

have

been

rewarded

so

far

for

owning

this

overlooked

company.

We

completed

our

exit

in

Maersk

and

Arista

and

also

eliminated

positions

in

Manpower,

UPS

and

Steel

Dynamics.

Arista

outperformed

our

expectations,

both

fundamentally

and

from

a

valuation

perspective

and

reached

a

point

where

its

valuation

was

not

discounting

any

slowing

growth

from

the

large

cloud

providers.

For

many

technology

companies

we

are

taking

a

hard

look

at

how

sustainable

the

revenue

growth

over

the

pandemic

period

is.

We

believe

that

there

has

been

a

pull-forward

in

technology

spending

since

the

pandemic

began

whereby

companies

had

to

increase

spending

to

improve

bandwidth

so

we

can

all

work

from

home,

pulling

in

revenues

from

the

future.

Growth

rates

are

likely

to

decline

from

this

accelerated

revenue

growth

and

is

a

major

contributor

to

this

preference

shift

from

growth

to

value

stocks

as

the

market

now

realizes

the

growth

rates

are

unsustainable.

UPS

and

Steel

Dynamics

were

both

successful

investments

and

their

success

came

suddenly,

both

increasing

dramatically

over

a

short

period

of

time.

Our

initial

thesis

on

Manpower

was

that

the

strong

labor

market

would

benefit

placement

agencies

over

our

investment

horizon,

however

with

the

labor

market

losing

steam

and

the

economy

seemingly

headed

in

the

other

direction,

we

decided

to

exit

the

position.

With

so

many

changes

having

taken

place

in

the

economy,

the

market

and

our

individual

lives

over

the

last

two

years

it

would

be

prudent

to

exercise

a

great

deal

of

caution

going

forward.

The

market

has

priced

in

a

lot

of

these

changes,

but

in

many

cases,

as

the

market

is

wont

to

do,

they

have

been

pushed

to

an

extreme.

The

first

three

quarters

of

2022,

in

our

opinion,

are

a

reflection

of

the

reversal

of

this

extreme.

Given

so

few

Value

oriented

fund

options

in

the

Socially

Responsible

marketplace,

we

are

incredibly

pleased

with

our

prospects.

____________________________________________________________________________

Current

and

future

portfolio

holdings

are

subject

to

change

and

risk.

Please

see

the

schedule

of

investments

section

in

this

report

for

a

full

listing

of

the

Fund’s

holdings

The

Morningstar

Category

is

used

to

compare

fund

performance

to

its

peers.

It

is

not

possible

to

invest

directly

into

an

index

or

category.

Past

performance

is

no

guarantee

of

future

results.

Risk

Considerations:

Mutual

fund

investing

involves

risk,

including

the

possible

loss

of

principal.

Socially

responsible

investment

criteria

may

limit

the

number

of

investment

opportunities

available

to

the

Fund

or

it

may

invest

a

larger

portion

of

its

assets

in

certain

sectors

which

could

be

more

sensitive

to

market

conditions,

economic,

regulatory

and

environmental

developments.

These

factors

could

negatively

impact

the

Fund’s

returns.

The

Fund

primarily

invests

in

undervalued

securities,

which

may

not

appreciate

in

value

as

anticipated

by

the

Advisor

or

remain

undervalued

for

longer

than

anticipated.

The

Fund

may

invest

in

American

Depositary

Receipts

(ADRs),

which

involves

risks

relating

to

political,

economic

or

regulatory

conditions

in

foreign

countries

and

may

cause

greater

volatility

and

less

liquidity.

The

Fund

may

also

invest

in

convertible

securities

and

preferred

stock,

which

may

be

adversely

affected

as

interest

rates

rise.

BAYWOOD

SOCIALLY

RESPONSIBLE

FUND

PERFORMANCE

CHART

AND

ANALYSIS

(Unaudited)

September

30,

2022

13

The

following

chart

reflects

the

change

in

the

value

of

a

hypothetical

$10,000

investment,

including

reinvested

dividends

and

distributions,

in

the

Baywood

Socially

Responsible

Fund

(the

“Fund”)

compared

with

the

performance

of

the

benchmark,

Morningstar

U.S.

Large

Value

TR

Index,

since

inception.

The

Morningstar

US

Large

Value

TR

Index

measures

the

performance

of

large-cap

stocks

with

relatively

low

prices

given

anticipated

per

share

earnings,

book

value,

cash

flow,

sales

and

dividends.

The

total

return

of

the

index

includes

the

reinvestment

of

dividends

and

income.

The

total

return

of

the

Fund

includes

operating

expenses

that

reduce

returns,

while

the

total

return

of

the

index

does

not

include

expenses.

The

Fund

is

professionally

managed,

while

the

index

is

unmanaged

and

is

not

available

for

investment.

Comparison

of

Change

in

Value

of

a

$10,000

Investment

Baywood

Socially

Responsible

Fund

vs.

Morningstar

US

Large

Value

TR

Index

Performance

data

quoted

represents

past

performance

and

is

no

guarantee

of

future

results.

Current

performance

may

be

lower

or

higher

than

the

performance

data

quoted.

Investment

return

and

principal

value

will

fluctuate

so

that

shares,

when

redeemed,

may

be

worth

more

or

less

than

original

cost.

For

the

most

recent

month-end

performance,

please

call

(855)

409-2297.

As

stated

in

the

Fund’s

prospectus,

the

annual

operating

expense

ratio

(gross)

is

3.76%.

However,

the

Fund’s

advisor has

contractually

agreed

to

waive

its

fee

and/or

reimburse

Fund

expenses

to

limit

Total

Annual

Fund

Operating

Expenses

After

Fee

Waiver

and/or

Expense

Reimbursement

(excluding

all

taxes,

interest,

portfolio

transaction

expenses,

acquired

fund

fees

and

expenses,

proxy

expenses

and

extraordinary

expenses)

to

0.89%,

through

January

31,

2023

(the

“Expense

Cap”).

The

Expense

Cap

may

be

raised

or

eliminated

only

with

the

consent

of

the

Board

of

Trustees.

The

Advisor

may

be

reimbursed

by

the

Fund

for

fees

waived

and

expenses

reimbursed

by

the

Advisor

pursuant

to

the

Expense

Cap

if

such

payment

is

made

within

three

years

of

the

fee

waiver

or

expense

reimbursement,

and

does

not

cause

the

Total

Annual

Fund

Operating

Expenses

After

Fee

Waiver

and/or

Expense

Reimbursement

to

exceed

the

lesser

of

(i)

the

then-current

expense

cap,

or

(ii)

the

expense

cap

in

place

at

the

time

the

fees/expenses

were

waived/reimbursed.

Total

Annual

Fund

Operating

Expenses

After

Fee

Waiver

and/or

Expense

Reimbursement

will

increase

if

exclusions

from

the

Expense

Cap

apply.

During

the

year,

certain

fees

were

waived

and/or

expenses

reimbursed;

otherwise,

returns

would

have

been

lower.

The

performance

table

and

graph

do

not

reflect

the

deduction

of

taxes

that

a

shareholder

would

pay

on

Fund

distributions

or

the

redemption

of

Fund

shares.

Returns

greater

than

one

year

are

annualized.

Average

Annual

Total

Returns

Periods

Ended

September

30,

2022

One

Year

Five

Year

Ten

Year

Since

Inception

01/03/05*

Baywood

Socially

Responsible

Fund

-6.58%

6.66%

8.15%

5.53%

Morningstar

US

Large

Value

TR

Index

-6.67%

5.70%

8.86%

6.39%

*

Performance

for

Institutional

Shares

for

periods

prior

to

January

8,

2016,

reflects

the

performance

and

expenses

of

City

National

Rochdale

Socially

Responsible

Equity

Fund,

a

series

of

City

National

Rochdale

Funds

(the

“Predecessor

Fund”).

BAYWOOD

SOCIALLY

RESPONSIBLE

FUND

SCHEDULE

OF

INVESTMENTS

September

30,

2022

14

See

Notes

to

Financial

Statements.

The

following

is

a

summary

of

the

inputs

used

to

value

the

Fund's instruments

as

of

September

30,

2022. 

The

inputs

or

methodology

used

for

valuing

securities

are

not

necessarily

an

indication

of

the

risks

associated

with

investing

in

those

securities.

For

more

information

on

valuation

inputs,

and

their

aggregation

into

the

levels

used

in

the

table

below,

please

refer

to

the

Security

Valuation

section

in

Note

2

of

the

accompanying

Notes

to

Financial

Statements.

The

Level

1

value

displayed

in

this

table

is

Common

Stock.

The

Level

2

value

displayed

in

this

table

is

a

Money

Market

Fund.

Refer

to

this

Schedule

of

Investments

for

a

further

breakout

of

each

security

by

industry.

Shares

Security

Description

Value

Common

Stock

-

92.3%

Basic

Materials

-

5.1%

800‌

International

Flavors

&

Fragrances,

Inc.

$

72,664‌

1,700‌

Newmont

Corp.

71,451‌

1,600‌

Nutrien,

Ltd.

133,408‌

500‌

Packaging

Corp.

of

America

56,145‌

333,668‌

Capital

Goods

/

Industrials

-

4.0%

450‌

Cummins,

Inc.

91,579‌

5,400‌

nVent

Electric

PLC

170,694‌

262,273‌

Communication

Services

-

4.6%

6,000‌

AT&T,

Inc.

92,040‌

4,800‌

Comcast

Corp.,

Class A

140,784‌

700‌

The

Walt

Disney

Co. 

(a)

66,031‌

298,855‌

Consumer

Discretionary

-

6.5%

700‌

Aptiv

PLC 

(a)

54,747‌

1,100‌

Genuine

Parts

Co.

164,252‌

6,200‌

Kontoor

Brands,

Inc.

208,382‌

427,381‌

Consumer

Staples

-

5.4%

1,600‌

Mondelez

International,

Inc.,

Class A

87,728‌

500‌

PepsiCo.,

Inc.

81,630‌

5,500‌

The

Kraft

Heinz

Co.

183,425‌

352,783‌

Energy

-

9.5%

2,600‌

Devon

Energy

Corp.

156,338‌

6,200‌

Kinder

Morgan,

Inc.

103,168‌

3,100‌

Schlumberger

NV

111,290‌

140‌

Texas

Pacific

Land

Corp.

248,812‌

619,608‌

Financials

-

21.4%

3,000‌

Air

Lease

Corp.

93,030‌

1,400‌

American

Express

Co.

188,874‌

4,400‌

American

International

Group,

Inc.

208,912‌

3,100‌

Bank

of

America

Corp.

93,620‌

600‌

Berkshire

Hathaway,

Inc.,

Class B 

(a)

160,212‌

2,200‌

BOK

Financial

Corp.

195,492‌

5,583‌

Brookfield

Asset

Management,

Inc.,

Class A

228,289‌

500‌

Chubb,

Ltd.

90,940‌

800‌

CME

Group,

Inc.

141,704‌

1,401,073‌

Health

Care

-

16.6%

400‌

Amgen,

Inc.

90,160‌

1,200‌

AstraZeneca

PLC,

ADR

65,808‌

850‌

Becton

Dickinson

and

Co.

189,405‌

2,200‌

Cardinal

Health,

Inc.

146,696‌

4,300‌

Koninklijke

Philips

NV,

ADR

66,177‌

450‌

Laboratory

Corp.

of

America

Holdings

92,165‌

700‌

Medtronic

PLC

56,525‌

2,000‌

Merck

&

Co.,

Inc.

172,240‌

300‌

Regeneron

Pharmaceuticals,

Inc. 

(a)

206,661‌

1,085,837‌

Real

Estate

-

2.6%

2,934‌

Realty

Income

Corp.

REIT

170,759‌

Technology

-

9.9%

2,400‌

Cisco

Systems,

Inc.

96,000‌

4,000‌

Corning,

Inc.

116,080‌

1,300‌

International

Business

Machines

Corp.

154,453‌

1,200‌

NetApp,

Inc.

74,220‌

800‌

NXP

Semiconductors

NV

118,008‌

800‌

TE

Connectivity,

Ltd.

88,288‌

647,049‌

Shares

Security

Description

Value

Transportation

-

6.7%

24,300‌

Atlas

Corp.

$

337,770‌

500‌

Union

Pacific

Corp.

97,410‌

435,180‌

Total

Common

Stock

(Cost

$4,986,554)

6,034,466‌

Shares

Security

Description

Value

Money

Market

Fund

-

8.1%

524,892‌

First

American

Government

Obligations

Fund,

Class X,

2.78% 

(b)

(Cost

$524,892)

524,892‌

Investments,

at

value

-

100.4%

(Cost

$5,511,446)

$

6,559,358‌

Other

Assets

&

Liabilities,

Net

-

(0.4)%

(23,242‌)

Net

Assets

-

100.0%

$

6,536,116‌

ADR

American

Depositary

Receipt

PLC

Public

Limited

Company

REIT

Real

Estate

Investment

Trust

(a)

Non-income

producing

security.

(b)

Dividend

yield

changes

daily

to

reflect

current

market

conditions.

Rate

was

the

quoted

yield

as

of

September

30,

2022.

Valuation

Inputs

Investments

in

Securities

Level

1

-

Quoted

Prices

$

6,034,466‌

Level

2

-

Other

Significant

Observable

Inputs

524,892‌

Level

3

-

Significant

Unobservable

Inputs

–‌

Total

$

6,559,358‌

PORTFOLIO

HOLDINGS

(Unaudited)

%

of

Total

Investments

Basic

Materials

5.1%‌

Capital

Goods

/

Industrials

4.0%‌

Communication

Services

4.6%‌

Consumer

Discretionary

6.5%‌

Consumer

Staples

5.4%‌

Energy

9.4%‌

Financials

21.4%‌

Health

Care

16.5%‌

Real

Estate

2.6%‌

Technology

9.9%‌

Transportation

6.6%‌

Money

Market

Fund

8.0%‌

100.0%‌

BAYWOOD

SOCIALLY

RESPONSIBLE

FUND

STATEMENT

OF

ASSETS

AND

LIABILITIES

September

30,

2022

15

See

Notes

to

Financial

Statements.

ASSETS

Investments,

at

value

(Cost

$5,511,446)

$

6,559,358‌

Receivables:

Fund

shares

sold

2,192‌

Dividends

10,791‌

From

investment

advisor

3,687‌

Prepaid

expenses

8,935‌

Total

Assets

6,584,963‌

LIABILITIES

Payables:

Investment

securities

purchased

14,985‌

Fund

shares

redeemed

120‌

Accrued

Liabilities:

Fund

services

fees

5,221‌

Other

expenses

28,521‌

Total

Liabilities

48,847‌

NET

ASSETS

$

6,536,116‌

COMPONENTS

OF

NET

ASSETS

Paid-in

capital

$

5,328,064‌

Distributable

Earnings

1,208,052‌

NET

ASSETS

$

6,536,116‌

SHARES

OF

BENEFICIAL

INTEREST

AT

NO

PAR

VALUE

(UNLIMITED

SHARES

AUTHORIZED)

510,501‌

NET

ASSET

VALUE,

OFFERING

AND

REDEMPTION

PRICE

PER

SHARE

$

12.80‌

BAYWOOD

SOCIALLY

RESPONSIBLE

FUND

STATEMENT

OF

OPERATIONS

FOR

THE

YEAR

ENDED

SEPTEMBER

30,

2022

16

See

Notes

to

Financial

Statements.

INVESTMENT

INCOME

Dividend

income

(Net

of

foreign

withholding

taxes

of

$1,651)

$

183,925‌

Total

Investment

Income

183,925‌

EXPENSES

Investment

advisor

fees

49,162‌

Fund

services

fees

64,774‌

Transfer

agent

fees

18,480‌

Custodian

fees

5,000‌

Registration

fees

19,850‌

Professional

fees

28,967‌

Trustees'

fees

and

expenses

4,752‌

Other

expenses

31,665‌

Total

Expenses

222,650‌

Fees

waived

and

expenses

reimbursed

(160,144‌)

Net

Expenses

62,506‌

NET

INVESTMENT

INCOME

121,419‌

NET

REALIZED

AND

UNREALIZED

GAIN

(LOSS)

Net

realized

gain

on

investments

208,499‌

Net

change

in

unrealized

appreciation

(depreciation)

on

investments

(759,857‌)

NET

REALIZED

AND

UNREALIZED

LOSS

(551,358‌)

DECREASE

IN

NET

ASSETS

RESULTING

FROM

OPERATIONS

$

(429,939‌)

BAYWOOD

SOCIALLY

RESPONSIBLE

FUND

STATEMENTS

OF

CHANGES

IN

NET

ASSETS

17

See

Notes

to

Financial

Statements.

For

the

Years

Ended

September

30,

2022

2021

OPERATIONS

Net

investment

income

$

121,419‌

$

75,418‌

Net

realized

gain

208,499‌

202,985‌

Net

change

in

unrealized

appreciation

(depreciation)

(759,857‌)

1,427,701‌

Increase

(Decrease)

in

Net

Assets

Resulting

from

Operations

(429,939‌)

1,706,104‌

DISTRIBUTIONS

TO

SHAREHOLDERS

Total

Distributions

Paid

(305,137‌)

(94,786‌)

CAPITAL

SHARE

TRANSACTIONS

Sale

of

shares

1,131,351‌

2,056,628‌

Reinvestment

of

distributions

302,121‌

94,123‌

Redemption

of

shares

(928,599‌)

(621,975‌)

Increase

in

Net

Assets

from

Capital

Share

Transactions

504,873‌

1,528,776‌

Increase

(Decrease)

in

Net

Assets

(230,203‌)

3,140,094‌

NET

ASSETS

Beginning

of

Year

6,766,319‌

3,626,225‌

End

of

Year

$

6,536,116‌

$

6,766,319‌

SHARE

TRANSACTIONS

Sale

of

shares

81,266‌

157,203‌

Reinvestment

of

distributions

21,279‌

7,174‌

Redemption

of

shares

(64,619‌)

(47,959‌)

Increase

in

Shares

37,926‌

116,418‌

BAYWOOD

SOCIALLY

RESPONSIBLE

FUND

FINANCIAL

HIGHLIGHTS

18

See

Notes

to

Financial

Statements.

These

financial

highlights

reflect

selected

data

for

a

share

outstanding

throughout

each

year.

For

the

Years

Ended

September

30,

2022

2021

2020

2019

2018

INSTITUTIONAL

SHARES

NET

ASSET

VALUE,

Beginning

of

Year

$

14.32‌

$

10.18‌

$

11.21‌

$

12.60‌

$

11.43‌

INVESTMENT

OPERATIONS

Net

investment

income

(a)

0.25‌

0.18‌

0.15‌

0.18‌

0.12‌

Net

realized

and

unrealized

gain

(loss)

(1.14‌)

4.19‌

(0.90‌)

(0.53‌)

1.31‌

Total

from

Investment

Operations

(0.89‌)

4.37‌

(0.75‌)

(0.35‌)

1.43‌

DISTRIBUTIONS

TO

SHAREHOLDERS

FROM

Net

investment

income

(0.21‌)

(0.14‌)

(0.15‌)

(0.16‌)

(0.10‌)

Net

realized

gain

(0.42‌)

(0.09‌)

(0.13‌)

(0.88‌)

(0.16‌)

Total

Distributions

to

Shareholders

(0.63‌)

(0.23‌)

(0.28‌)

(1.04‌)

(0.26‌)

NET

ASSET

VALUE,

End

of

Year

$

12.80‌

$

14.32‌

$

10.18‌

$

11.21‌

$

12.60‌

TOTAL

RETURN

(6.58‌)%

43.10‌%

(6.67‌)%

(1.79‌)%

12.66‌%

RATIOS/SUPPLEMENTARY

DATA

Net

Assets

at

End

of

Year

(000s

omitted)

$

6,536‌

$

6,766‌

$

3,626‌

$

3,824‌

$

1,699‌

Ratios

to

Average

Net

Assets:

Net

investment

income

1.73‌%

1.31‌%

1.45‌%

1.60‌%

1.01‌%

Net

expenses

0.89‌%

0.89‌%

0.89‌%

0.89‌%

0.89‌%

Gross

expenses

(b)

3.17‌%

3.76‌%

5.10‌%

5.78‌%

3.03‌%

PORTFOLIO

TURNOVER

RATE

22‌%

15‌%

30‌%

33‌%

31‌%

(a)

Calculated

based

on

average

shares

outstanding

during

each

year.

(b)

Reflects

the

expense

ratio

excluding

any

waivers

and/or

reimbursements.

BAYWOOD

FUNDS

NOTES

TO

FINANCIAL

STATEMENTS

September

30,

2022

19

Note

1.

Organization

Baywood

Value

Plus

Fund

and

Baywood

Socially

Responsible

Fund

(individually,

a

“Fund”

and

collectively,

the

“Funds”)

are

diversified

portfolios

of

Forum

Funds

II

(the

“Trust”).

The

Trust

is

a

Delaware

statutory

trust

that

is

registered

as

an

open-end,

management

investment

company

under

the

Investment

Company

Act

of

1940,

as

amended

(the

“Act”).

Under

its

Trust

Instrument,

the

Trust

is

authorized

to

issue

an

unlimited

number

of

each

Fund’s

shares

of

beneficial

interest

without

par

value.

The

Baywood

Value

Plus

Fund

commenced

operations

on

December

2,

2013,

through

a

reorganization

of

a

collective

investment

trust

into

the

Baywood

Value

Plus

Fund.

The

collective

investment

trust

was

previously

managed

by

the

Baywood

Value

Plus

Fund’s

Advisor

and

portfolio

management

team.

This

collective

investment

trust

was

organized

and

commenced

operations

on

June

27,

2008.

The

Baywood

Value

Plus

Fund

currently

offers

Institutional

Shares.

The

Baywood

Value

Plus

Fund

seeks

to

achieve

long-term

capital

appreciation

by

investing

in

undervalued

equity

securities.

The

Baywood

Socially

Responsible

Fund

commenced

operations

on

January

3,

2005.

The

Baywood

Socially

Responsible

Fund

currently

offers

Institutional

Shares.

The

Baywood

Socially

Responsible

Fund

seeks

to

provide

long-term

capital

growth.

On

December

7,

2015,

at

a

special

meeting

of

shareholders

of

Baywood

Socially

Responsible

Fund,

formerly

City

National

Rochdale

Socially

Responsible

Equity

Fund,

a

series

of

City

National

Rochdale

Funds

(the

"Predecessor

Fund"),

the

shareholders

approved

a

proposal

to

reorganize

the

Predecessor

Fund

into

the

Baywood

Socially

Responsible

Fund,

a

newly

created

series

of

the

Forum

Funds

II.

The

Predecessor

Fund

was

sub-advised

by

the

Fund's

Advisor,

SKBA

Capital

Management,

LLC,

with

the

same

portfolio

managers

as

the

Baywood

Socially

Responsible

Fund.

The

Baywood

Socially

Responsible

Fund

is

managed

in

a

manner

that

is

in

all

material

respects

equivalent

to

the

management

of

the

Predecessor

Fund,

including

the

investment

objective,

strategies,

guidelines

and

restrictions.

The

primary

purpose

of

the

reorganization

was

to

move

the

Predecessor

Fund

to

a

newly

created

series

of

Forum

Funds

II.

As

a

result

of

the

reorganization,

the

Baywood

Socially

Responsible

Fund

is

now

operating

under

the

supervision

of

the

Trust’s

board

of

trustees.

On

January

8,

2016,

the

Baywood

Socially

Responsible

Fund

acquired

all

of

the

assets,

subject

to

liabilities,

of

the

Predecessor

Fund.

The

shares

of

the

Predecessor

Fund

were,

in

effect,

exchanged

on

a

tax-free

basis

for

Shares

of

the

Baywood

Socially

Responsible

Fund

with

the

same

aggregate

value.

No

commission

or

other

transactional

fees

were

imposed

on

shareholders

in

connection

with

the

tax-free

exchange

of

their

shares.

Note

2.

Summary

of

Significant

Accounting

Policies

The

Funds

are

investment

companies

and

follow

accounting

and

reporting

guidance

under

Financial

Accounting

Standards

Board

Accounting

Standards

Codification

Topic

946,

“Financial

Services

–

Investment

Companies.”

These

financial

statements

are

prepared

in

accordance

with

accounting

principles

generally

accepted

in

the

United

States

of

America

(“GAAP”),

which

require

management

to

make

estimates

and

assumptions

that

affect

the

reported

amounts

of

assets

and

liabilities,

the

disclosure

of

contingent

liabilities

at

the

date

of

the

financial

statements,

and

the

reported

amounts

of

increases

and

decreases

in

net

assets

from

operations

during

the

fiscal

year.

Actual

amounts

could

differ

from

those

estimates.

The

following

summarizes

the

significant

accounting

policies

of

each

Fund:

Security

Valuation

–

Securities

are

valued

at

market

prices

using

the

last

quoted

trade

or

official

closing

price

from

the

principal

exchange

where

the

security

is

traded,

as

provided

by

independent

pricing

services

on

each

Fund

business

day.

In

the

absence

of

a

last

trade,

securities

are

valued

at

the

mean

of

the

last

bid

and

ask

price

provided

by

the

pricing

service.

Shares

of

non-exchange

traded

open-end

mutual

funds

are

valued

at

net

asset

value

(“NAV”).

Short-term

investments

that

mature

in

sixty

days

or

less

may

be

valued

at

amortized

cost.

Pursuant

to

Rule

2a-5

under

the

Investment

Company

Act,

the

Trust's

Board

of

Trustees

(the

"Board")

has

designated

the

Advisor,

as

defined

in

Note

3,

as

each

Fund's

valuation

designee

to

perform

any

fair

value

determinations

for

securities

and

other

assets

held

by

each

Fund.

The

Advisor

is

subject

to

the

oversight

of

the

Board

and

certain

reporting

and

other

requirements

intended

to

provide

the

Board

the

information

needed

to

oversee

the

Advisor's

fair

value

determinations.

The

Advisor

is

responsible

for

determining

the

fair

value

of

investments

for

which

market

quotations

are

not

readily

available

in

accordance

with

policies

and

procedures

that

have

been

approved

by

the

Board.

Under

these

procedures,

the

Advisor

convenes

on

a

regular

and

ad

hoc

basis

to

review

such

investments

and

considers

a

number

of

factors,

including

valuation

methodologies

and

significant

unobservable

inputs,

when

arriving

at

fair

value.

The

Board

has

approved

the

Advisor’s

fair

valuation

procedures

as

a

part

of

each

Fund’s

compliance

program

and

will

review

any

changes

made

to

the

procedures.

The

Advisor

provides

fair

valuation

inputs.

In

determining

fair

valuations,

inputs

may

include

market-based

analytics

that

may

consider

related

or

comparable

assets

or

liabilities,

recent

transactions,

market

multiples,

book

values

and

other

relevant

investment

information.

Advisor

inputs

may

include

an

income-based

approach

in

which

the

anticipated

future

cash

flows

of

the

investment

are

discounted

BAYWOOD

FUNDS

NOTES

TO

FINANCIAL

STATEMENTS

September

30,

2022

20

in

determining

fair

value.

Discounts

may

also

be

applied

based

on

the

nature

or

duration

of

any

restrictions

on

the

disposition

of

the

investments.

The

Advisor

performs

regular

reviews

of

valuation

methodologies,

key

inputs

and

assumptions,

disposition

analysis

and

market

activity.

Fair

valuation

is

based

on

subjective

factors

and,

as

a

result,

the

fair

value

price

of

an

investment

may

differ

from

the

security’s

market

price

and

may

not

be

the

price

at

which

the

asset

may

be

sold.

Fair

valuation

could

result

in

a

different

NAV

than

a

NAV

determined

by

using

market

quotes.

GAAP

has

a

three-tier

fair

value

hierarchy.

The

basis

of

the

tiers

is

dependent

upon

the

various

“inputs”

used

to

determine

the

value

of

each

Fund’s

investments.

These

inputs

are

summarized

in

the

three

broad

levels

listed

below:

Level

1

-

Quoted

prices

in

active

markets

for

identical

assets

and

liabilities.

Level

2

-

Prices

determined

using

significant

other

observable

inputs

(including

quoted

prices

for

similar

securities,

interest

rates,

prepayment

speeds,

credit

risk,

etc.).

Short-term

securities

with

maturities

of

sixty

days

or

less

are

valued

at

amortized

cost,

which

approximates

market

value,

and

are

categorized

as

Level

2

in

the

hierarchy.

Municipal

securities,

long-term

U.S.

government

obligations

and

corporate

debt

securities

are

valued

in

accordance

with

the

evaluated

price

supplied

by

a

pricing

service

and

generally

categorized

as

Level

2

in

the

hierarchy.

Other

securities

that

are

categorized

as

Level

2

in

the

hierarchy

include,

but

are

not

limited

to,

warrants

that

do

not

trade

on

an

exchange,

securities

valued

at

the

mean

between

the

last

reported

bid

and

ask

quotation

and

international

equity

securities

valued

by

an

independent

third

party

with

adjustments

for

changes

in

value

between

the

time

of

the

securities’

respective

local

market

closes

and

the

close

of

the

U.S.

market.

Level

3

-

Significant

unobservable

inputs

(including

each

Fund’s

own

assumptions

in

determining

the

fair

value

of

investments).

The

aggregate

value

by

input

level,

as

of

September

30,

2022,

for

each

Fund’s

investments

is

included

at

the

end

of

each

Fund’s

Schedule

of

Investments.

REITs

–

Each

Fund

has

made

certain

investments

in

real

estate

investment

trusts

(“REITs”)

which

pay

dividends

to

their

shareholders

based

upon

funds

available

from

operations.

It

is

quite

common

for

these

dividends

to

exceed

the

REIT’s

taxable

earnings

and

profits

resulting

in

the

excess

portion

of

such

dividends

being

designated

as

a

return

of

capital.

Each

Fund

may

include

the

gross

dividends

from

such

REITs

in

income

or

may

utilize

estimates

of

any

potential

REIT

dividend

reclassifications

in

each

Fund’s

annual

distributions

to

shareholders

and,

accordingly,

a

portion

of

each

Fund’s

distributions

may

be

designated

as

a

return

of

capital,

require

reclassification,

or

be

under

distributed

on

an

excise

basis

and

subject

to

excise

tax.

Security

Transactions,

Investment

Income

and

Realized

Gain

and

Loss

–

Investment

transactions

are

accounted

for

on

the

trade

date.

Dividend

income

is

recorded

on

the

ex-dividend

date.

Foreign

dividend

income

is

recorded

on

the

ex-dividend

date

or

as

soon

as

possible

after

determining

the

existence

of

a

dividend

declaration

after

exercising

reasonable

due

diligence.

Interest

income

is

recorded

on

an

accrual

basis.

Premium

is

amortized

to

the

next

call

date

above

par

and

discount

is

accreted

to

maturity

using

the

effective

interest

method.

Identified

cost

of

investments

sold

is

used

to

determine

the

gain

and

loss

for

both

financial

statement

and

federal

income

tax

purposes.

Distributions

to

Shareholders

–

Distributions

to

shareholders

of

net

investment

income,

if

any,

are

declared

and

paid

at

least

annually.

Distributions

to

shareholders

of

net

capital

gains,

if

any,

are

declared

and

paid

at

least

at

least

annually.

Distributions

to

shareholders

are

recorded

on

the

ex-dividend

date.

Distributions

are

based

on

amounts

calculated

in

accordance

with

applicable

federal

income

tax

regulations,

which

may

differ

from

GAAP.

These

differences

are

due

primarily

to

differing

treatments

of

income

and

gain

on

various

investment

securities

held

by

each

Fund,

timing

differences

and

differing

characterizations

of

distributions

made

by

each

Fund.

Federal

Taxes

–

Each

Fund

intends

to

continue

to

qualify

each

year

as

a

regulated

investment

company

under

Subchapter

M

of

Chapter

1,

Subtitle

A,

of

the

Internal

Revenue

Code

of

1986,

as

amended

(“Code”),

and

to

distribute

all

of

its

taxable

income

to

shareholders.

In

addition,

by

distributing

in

each

calendar

year

substantially

all

of

its

net

investment

income

and

capital

gains,

if

any,

the

Funds

will

not

be

subject

to

a

federal

excise

tax.

Therefore,

no

federal

income

or

excise

tax

provision

is

required.

Each

Fund

files

a

U.S.

federal

income

and

excise

tax

return

as

required.

Each

Fund’s

federal

income

tax

returns

are

subject

to

examination

by

the

Internal

Revenue

Service

for

a

period

of

three

fiscal

years

after

they

are

filed.

As

of

September

30,

2022,

there

are

no

uncertain

tax

positions

that

would

require

financial

statement

recognition,

de-recognition

or

disclosure.

BAYWOOD

FUNDS

NOTES

TO

FINANCIAL

STATEMENTS

September

30,

2022

21

Income

and

Expense

Allocation

–

The

Trust

accounts

separately

for

the

assets,

liabilities

and

operations

of

each

of

its

investment

portfolios.

Expenses

that

are

directly

attributable

to

more

than

one

investment

portfolio

are

allocated

among

the

respective

investment

portfolios

in

an

equitable

manner.

Commitments

and

Contingencies

–

In

the

normal

course

of

business,

each

Fund

enters

into

contracts

that

provide

general

indemnifications

by

each

Fund

to

the

counterparty

to

the

contract.

Each

Fund’s

maximum

exposure

under

these

arrangements

is

dependent

on

future

claims

that

may

be

made

against

each

Fund

and,

therefore,

cannot

be

estimated;

however,

based

on

experience,

the

risk

of

loss

from

such

claims

is

considered

remote.

Each

Fund

has

determined

that

none

of

these

arrangements

requires

disclosure

on

each

Fund’s

balance

sheet.

Note

3.

Fees

and

Expenses

Investment

Advisor

–

SKBA

Capital

Management,

LLC

(the

“Advisor”)

is

the

investment

adviser

to

the

Funds.

Pursuant

to

an

investment

advisory

agreement,

the

Advisor

receives

an

advisory

fee,

payable

monthly,

at

an

annual

rate

of

0.50%

and

0.70%

of

the

average

daily

net

assets

of

Baywood

Value

Plus

Fund

and

Baywood

Socially

Responsible

Fund,

respectively.

Distribution

–

Foreside

Fund

Services,

LLC

(the

“Distributor”),

a

wholly

owned

subsidiary

of

Foreside

Financial

Group,

LLC

(doing

business

as

ACA

Group),

acts

as

the

agent

of

the

Trust

in

connection

with

the

continuous

offering

of

shares

of

the

Funds.

The

Funds

do

not

have

a

distribution

(12b-1)

plan;

accordingly,

the

Distributor

does

not

receive

compensation

from

the

Funds

for

its

distribution

services.

The

Advisor

compensates

the

Distributor

directly

for

its

services.

The

Distributor

is

not

affiliated

with

the

Advisor

or

Atlantic

Fund

Administration,

LLC,

a

wholly

owned

subsidiary

of

Apex

US

Holdings

LLC

(d/b/a

Apex

Fund

Services)

(“Apex”)

or

their

affiliates.

Other

Service

Providers

–

Apex

provides

fund

accounting,

fund

administration,

compliance

and

transfer

agency

services

to

each

Fund.

The

fees

related

to

these

services

are

included

in

Fund

services

fees

within

the

Statements

of

Operations.

Apex

also

provides

certain

shareholder

report

production

and

EDGAR

conversion

and

filing

services.

Pursuant

to

an

Apex

Services

Agreement,

each

Fund

pays

Apex

customary

fees

for

its

services.

Apex

provides

a

Principal

Executive

Officer,

a

Principal

Financial

Officer,

a

Chief

Compliance

Officer

and

an

Anti-Money

Laundering

Officer

to

each

Fund,

as

well

as

certain

additional

compliance

support

functions.

Trustees

and

Officers

–

The

Trust

pays

each

Independent

Trustee

an

annual

fee

of

$16,000

($21,000

for

the

Chairman)

for

service

to

the

Trust.

The

Independent

Trustees

and

Chairman

may

receive

additional

fees

for

special

Board

meetings.

The

Independent

Trustees

are

also

reimbursed

for

all

reasonable

out-of-pocket

expenses

incurred

in

connection

with

their

duties

as

Trustees,

including

travel

and

related

expenses

incurred

in

attending

Board

meetings.

The

amount

of

Independent

Trustees’

fees

attributable

to

each

Fund

is

disclosed

in

the

Statements

of

Operations.

Certain

officers

of

the

Trust

are

also

officers

or

employees

of

the

above

named

service

providers,

and

during

their

terms

of

office

received

no

compensation

from

each

Fund.

Note

4.

Expense

Reimbursement

and

Fees

Waived

The

Advisor

has

contractually

agreed

to

waive

its

fee

and/or

reimburse

certain

expenses

to

limit

total

operating

expenses

(excluding

all

taxes,

interest,

portfolio

transaction

expenses,

acquired

fund

fees

and

expenses,

proxy

expenses

and

extraordinary

expenses)

to

0.70%

through

January

31,

2023,

for

Baywood

Value

Plus

Fund.

The

Advisor

also

has

contractually

agreed

to

waive

its

fees

and/or

reimburse

certain

expenses

to

limit

total

operating

expenses

(excluding

all

taxes,

interest,

portfolio

transaction

expenses,

acquired

fund

fees

and

expenses,

proxy

expenses

and

extraordinary

expenses)

to

0.89%

through

January

31,

2023,

for

Baywood

Socially

Responsible

Fund.

Other

Fund

service

providers

have

voluntarily

agreed

to

waive

and

reimburse

a

portion

of

their

fees.

These

voluntary

fee

waivers

and

reimbursements

may

be

reduced

or

eliminated

at

any

time.

For

the

year

ended

September

30,

2022,

fees

waived

and

expenses

reimbursed

were

as

follows:

The

Advisor

may

be

reimbursed

by

each

Fund

for

fees

waived

and

expenses

reimbursed

by

the

Advisor

pursuant

to

the

Expense

Cap

if

such

payment

is

made

within

three

years

of

the

fee

waiver

or

expense

reimbursement,

and

does

not

cause

the

Total

Annual

Fund

Operating

Expenses

After

Fee

Waiver

and/or

Expense

Reimbursement

to

exceed

the

lesser

of

(i)

the

then-current

expense

cap,

or

(ii)

the

expense

cap

in

place

at

the

time

the

fees/expenses

were

waived/reimbursed.

As

of

September

30,

2022,

$412,884

and

$420,376

in

the

Investment

Adviser

Fees

Waived

Investment

Adviser

Expenses

Reimbursed

Other

Waivers

Total

Fees

Waived

and

Expenses

Reimbursed

Baywood

Value

Plus

Fund

$

17,791‌

$

120,708‌

$

21,150‌

$

159,649‌

Baywood

Socially

Responsible

Fund

49,162‌

89,832‌

21,150‌

160,144‌

BAYWOOD

FUNDS

NOTES

TO

FINANCIAL

STATEMENTS

September

30,

2022

22

Baywood

Value

Plus

Fund

and

Baywood

Socially

Responsible

Fund,

respectively,

is

subject

to

recapture

by

the

Advisor.

Other

Waivers

are

not

eligible

for

recoupment.

Note

5.

Security

Transactions

The

cost

of

purchases

and

proceeds

from

sales

of

investment

securities

(including

maturities),

other

than

short-term

investments

during

the

year

ended

September

30,

2022

were

as

follows:

Note

6.

Federal

Income

Tax

As

of

September

30,

2022

,

the

cost

for

federal

income

tax

purposes

and

the

components

of

net

unrealized

appreciation

were

as

follows:

Distributions

paid

during

the

fiscal

years

ended

as

noted

were

characterized

for

tax

purposes

as

follows:

As

of

September

30,

2022,

distributable

earnings

(accumulated

loss)

on

a

tax

basis

were

as

follows:

The

difference

between

components

of

distributable

earnings

on

a

tax

basis

and

the

amounts

reflected

in

the

Statements

of

Assets

and

Liabilities

are

primarily

due

to

wash

sales,

REITS

and

equity

return

of

capital.

Note

7.

Subsequent

Events

Subsequent

events

occurring

after

the

date

of

this

report

through

the

date

these

financial

statements

were

issued

have

been

evaluated

for

potential

impact,

and

each

Fund

has

had

no

such

events.

Management

has

evaluated

the

need

for

additional

disclosures

and/or

adjustments

resulting

from

subsequent

events.

Based

on

this

evaluation,

no

additional

disclosures

or

adjustments

were

required.

Purchases

Sales

Baywood

Value

Plus

Fund

$1,614,014

$

1,629,574‌

Baywood

Socially

Responsible

Fund

1,559,907

1,471,413

Tax

Cost

of

Investments

Gross

Unrealized

Appreciation

Gross

Unrealized

Depreciation

Net

Unrealized

Appreciation

Baywood

Value

Plus

Fund

$

2,863,807‌

$

501,200‌

$

(125,429‌)

$

375,771‌

Baywood

Socially

Responsible

Fund

5,524,014‌

1,299,875‌

(264,531‌)

1,035,344‌

Ordinary

Income

Long-Term

Capital

Gain

Total

Baywood

Value

Plus

Fund

2022

$

90,123‌

$

257,240‌

$

347,363‌

2021

71,909‌

–‌

71,909‌

Baywood

Socially

Responsible

Fund

2022

186,039‌

119,098‌

305,137‌

2021

62,096‌

32,690‌

94,786‌

Undistributed

Ordinary

Income

Undistributed

Long-Term

Gain

Unrealized

Appreciation

Total

Baywood

Value

Plus

Fund

$

1,014‌

$

71,347‌

$

375,771‌

$

448,132‌

Baywood

Socially

Responsible

Fund

5,057‌

167,651‌

1,035,344‌

1,208,052‌

REPORT

OF

INDEPENDENT

REGISTERED

PUBLIC

ACCOUNTING

FIRM

23

To

the

Shareholders

of

Baywood

Value

Plus

Fund

and

Baywood

Socially

Responsible

Fund

and

the

Board

of

Trustees

of

Forum

Funds

II

Opinion

on

the

Financial

Statements

We

have

audited

the

accompanying

statements

of

assets

and

liabilities

of

Baywood

Value

Plus

Fund

and

Baywood

Socially

Responsible

Fund,

each

a

series

of

shares

of

beneficial

interest

in

Forum

Funds

II

(the

“Funds”),

including

the

schedules

of

investments,

as

of

September

30,

2022,

and

the

related

statements

of

operations

for

the

year

then

ended,

the

statements

of

changes

in

net

assets

for

each

of

the

years

in

the

two-year

period

then

ended,

the

financial

highlights

for

each

of

the

years

in

the

five-year

period

then

ended,

and

the

related

notes

(collectively

referred

to

as

the

“financial

statements”).

In

our

opinion,

the

financial

statements

present

fairly,

in

all

material

respects,

the

financial

position

of

the

Funds

as

of

September

30,

2022,

and

the

results

of

their

operations

for

the

year

then

ended,

the

changes

in

their

net

assets

for

each

of

the

years

in

the

two-year

period

then

ended

and

their

financial

highlights

for

each

of

the

years

in

the

five-year

period

then

ended,

in

conformity

with

accounting

principles

generally

accepted

in

the

United

States

of

America.

Basis

for

Opinion

These

financial

statements

are

the

responsibility

of

the

Funds'

management.

Our

responsibility

is

to

express

an

opinion

on

the

Funds’

financial

statements

based

on

our

audits.

We

are

a

public

accounting

firm

registered

with

the

Public

Company

Accounting

Oversight

Board

(United

States)

(“PCAOB”)

and

are

required

to

be

independent

with

respect

to

the

Funds

in

accordance

with

the

U.S.

federal

securities

law

and

the

applicable

rules

and

regulations

of

the

Securities

and

Exchange

Commission

and

the

PCAOB.

We

conducted

our

audits

in

accordance

with

the

standards

of

the

PCAOB.

Those

standards

require

that

we

plan

and

perform

the

audits

to

obtain

reasonable

assurance

about

whether

the

financial

statements

are

free

of

material

misstatement,

whether

due

to

error

or

fraud.

The

Funds

are

not

required

to

have,

nor

were

we

engaged

to

perform,

an

audit

of

their

internal

control

over

financial

reporting.

As

part

of

our

audits

we

are

required

to

obtain

an

understanding

of

internal

control

over

financial

reporting

but

not

for

the

purpose

of

expressing

an

opinion

on

the

effectiveness

of

the

Funds’

internal

control

over

financial

reporting.

Accordingly,

we

express

no

such

opinion.

Our

audits

included

performing

procedures

to

assess

the

risk

of

material

misstatement

of

the

financial

statements,

whether

due

to

error

or

fraud,

and

performing

procedures

that

respond

to

those

risks.

Such

procedures

included

examining,

on

a

test

basis,

evidence

regarding

the

amounts

and

disclosures

in

the

financial

statements.

Our

procedures

included

confirmation

of

securities

owned

as

of

September

30,

2022

by

correspondence

with

the

custodian,

brokers,

or

by

other

appropriate

auditing

procedures

where

replies

from

brokers

were

not

received.

Our

audits

also

included

evaluating

the

accounting

principles

used

and

significant

estimates

made

by

management,

as

well

as

evaluating

the

overall

presentation

of

the

financial

statements.

We

believe

that

our

audits

provide

a

reasonable

basis

for

our

opinion.

BBD,

LLP

We

have

served

as

the

auditor

of

one

or

more

of

the

Funds

in

the

Forum

Funds

II

since

2013.

Philadelphia,

Pennsylvania

November

28,

2022

Baywood

Funds

ADDITIONAL

INFORMATION

(Unaudited)

September

30,

2022

24

Investment

Advisory

Agreement

Approval

At

the

September

16,

2022

Board

meeting

(“September

meeting”),

the

Board,

including

the

Independent

Trustees,

met

in

person

and

considered

the

approval

of

the

continuance

of

the

investment

advisory

agreement

between

the

Advisor

and

the

Trust

pertaining

to

the

Funds

(the

“Advisory

Agreement”).

In

preparation

for

the

September

meeting,

the

Board

was

presented

with

a

range

of

information

to

assist

in

its

deliberations.

The

Board

requested

and

reviewed

written

responses

from

the

Adviser

to

a

letter

circulated

on

the

Board's

behalf

concerning

the

Adviser’s

personnel,

operations,

financial

condition,

performance,

and

services

provided

to

the

Funds

by

the

Adviser.

During

its

deliberations,

the

Board

received

an

oral

presentation

from

the

Adviser

and

discussed

the

materials

with

the

Adviser,

independent

legal

counsel

to

the

Independent

Trustees

(“Independent

Legal

Counsel”),

and,

as

necessary,

with

the

Trust's

administrator.

The

Independent

Trustees

also

met

in

executive

session

with

Independent

Legal

Counsel

while

deliberating.

At

the

September

meeting,

the

Board

reviewed,

among

other

matters,

the

topics

discussed

below:

Nature,

Extent

and

Quality

of

Services

Based

on

written

materials

received

and

the

presentation

from

senior

representatives

of

the

Adviser

regarding

the

personnel,

operations,

and

financial

condition

of

the

Adviser,

the

Board

considered

the

quality

of

services

provided

by

the

Adviser

under

the

Advisory

Agreement.

In

this

regard,

the

Board

considered

information

regarding

the

experience,

qualifications

and

professional

background

of

the

portfolio

managers

and

other

personnel

at

the

Adviser

with

principal

responsibility

for

the

Funds,

as

well

as

the

investment

philosophy

and

decision-making

process

of

those

professionals

and

the

capability

of

the

Adviser’s

senior

management

and

staff.

The

Board

also

considered

the

adequacy

of

the

Adviser’s

resources

and

noted

the

Adviser’s

representations

that

the

firm

is

in

stable

financial

condition

and

has

the

operational

capability

and

the

necessary

staffing

and

experience

to

continue

providing

high-quality

investment

advisory

services

to

the

Funds.

Based

on

the

presentation

and

the

materials

provided

by

the

Adviser

in

connection

with

the

Board’s

consideration

of

the

renewal

of

the

Advisory

Agreement,

among

other

relevant

factors,

the

Board

concluded

that,

overall,

it

was

satisfied

with

the

nature,

extent

and

quality

of

services

provided

to

the

Funds

under

the

Advisory

Agreement.

Performance

In

connection

with

a

presentation

by

the

Adviser

regarding

its

approach

to

managing

the

Funds,

including

the

investment

objective

and

strategy

of

each

Fund,

the

Board

reviewed

the

performance

of

each

Fund

compared

to

their

respective

primary

benchmarks

and

compared

to

independent

peer

groups

of

funds

identified

by

a

third-party,

independent

service

provider,

Strategic

Insight,

Inc.

(“Strategic

Insight”),

believed

to

have

characteristics

similar

to

those

of

the

Funds.

The

Board

observed

that

the

Value

Plus

Fund

outperformed

its

primary

benchmark

index,

the

Morningstar

US

Large

Value

Total

Return

Index,

for

the

one-

and

three-year

periods

ended

June

30,

2022

and

for

the

period

since

the

Value

Plus

Fund’s

inception

on

June

27,

2008,

and

underperformed

the

primary

benchmark

index

for

the

five-

and

10-year

periods

ended

June

30,

2022.

The

Board

also

observed

that,

based

on

the

information

provided

by

Strategic

Insight,

the

Value

Plus

Fund

outperformed

the

average

of

its

Strategic

Insight

peers

for

the

one-,

three-,

and

five-year

periods

ended

June

30,

2022.

The

Board

noted

the

Adviser’s

representation

that

the

Value

Plus

Fund’s

relative

outperformance

during

the

short

term

could

be

attributed,

at

least

in

part,

to

style

specialization,

as

the

market

had

recently

shifted

in

favor

of

value-oriented

strategies

after

lagging

growth-oriented

strategies

for

a

decade.

The

Board

also

noted

the

Adviser’s

representation

that

the

Value

Plus

Fund’s

outperformance

relative

to

other

value-oriented

strategies

could

be

attributed

to

the

Value

Plus

Fund’s

emphasis

on

dividend-paying

and

general

“high

quality”

investments,

which

tended

to

underperform

in

periods

of

high

absolute

benchmark

returns,

such

as

the

market

environment

of

the

last

10

years,

and

outperform

in

periods

of

low/negative

benchmark

returns,

such

as

the

market

environment

for

the

latest

one-year

period.

The

Board

observed

that

the

Socially

Responsible

Fund

underperformed

its

primary

benchmark

index,

the

Morningstar

US

Large

Value

Total

Return

Index,

for

the

one-,

five-,

and

ten-year

periods

ended

June

30,

2022,

as

well

as

the

period

since

the

Socially

Responsible

Fund’s

inception

on

January

3,

2005,

and

outperformed

its

primary

benchmark

index

for

the

three-year

period

ended

June

30,

2022.

The

Board

observed

that

the

Socially

Responsible

Fund

underperformed

the

average

of

its

Strategic

Insight

peers

for

the

one-

and

ten-year

periods

ended

June

30,

2022

and

outperformed

the

average

of

its

Strategic

Insight

peers

for

the

three-

and

five-year

periods

ended

June

30,

2022.

The

Board

noted

the

Adviser’s

representation

that

the

Socially

Responsible

Fund’s

relative

underperformance

during

the

short

term

could

be

attributed,

at

least

in

part,

to

sector

allocation

and

stock

selection.

The

Board

also

noted

the

Adviser’s

representation

that

the

Socially

Responsible

Fund’s

underperformance

over

the

longer

term

could

be

attributed,

at

least

in

part,

to

a

significant

shareholder

redemption

that

occurred

prior

to

the

Socially

Responsible

Fund’s

reorganization

into

the

Trust

at

the

beginning

of

Baywood

Funds

ADDITIONAL

INFORMATION

(Unaudited)

September

30,

2022

25

2016,

which

disproportionately

impacted

the

Socially

Responsible

Fund’s

long-term

performance.

The

Board

further

noted

the

Adviser’s

representation

that

the

Morningstar

US

Large

Value

Total

Return

Index

did

not

have

the

same

socially

responsible

investment

constraints

as

those

of

the

Socially

Responsible

Fund,

which

could

result

in

performance

variance

versus

the

index.

In

consideration

of

the

Funds’

investment

strategies

and

the

foregoing

performance

information,

among

other

considerations,

the

Board

determined

that

the

Funds

could

benefit

from

the

Adviser’s

continued

management

of

each

Fund.

Compensation

The

Board

evaluated

the

Adviser’s

compensation

for

providing

advisory

services

to

the

Funds

and

analyzed

comparative

information

on

actual

advisory

fee

rates

and

actual

total

expense

ratios

of

the

Funds

as

compared

to

those

of

their

respective

Strategic

Insight

peer

groups.

The

Board

observed

that

the

Adviser’s

net

management

fee

rates

for

each

of

the

Funds

were

less

than

the

medians

of

their

respective

Strategic

Insight

peer

groups.

The

Board

also

observed

that

the

net

total

expense

ratio

for

the

Value

Plus

Fund

was

less

than

the

median

of

its

Strategic

Insight

peer

group

and

that,

although

the

net

total

expense

ratio

for

the

Socially

Responsible

Fund

was

higher

than

the

median

of

its

Strategic

Insight

peer

group,

the

Socially

Responsible

Fund’s

net

total

expense

ratio

with

within

a

narrow

range

of

the

median

of

its

peers.

Based

on

the

foregoing,

and

other

relevant

considerations,

the

Board

concluded

that

the

Adviser’s

advisory

fee

rates

charged

to

the

Funds

were

reasonable.

Cost

of

Services

and

Profitability

The

Board

considered

information

provided

by

the

Adviser

regarding

the

costs

of

services

and

its

profitability

with

respect

to

the

Funds.

In

this

regard,

the

Board

considered

the

Adviser’s

resources

devoted

to

the

Funds,

as

well

as

the

information

provided

by

the

Adviser

regarding

the

costs

and

profitability

of

its

Fund

activities.

The

Board

noted

the

Adviser’s

representation

that,

as

a

result

of

the

contractual

expense

limitation

arrangement

in

place

for

each

of

the

Funds,

the

Adviser

was

not

earning

any

profit

from

its

mutual

fund

operations

but

that

the

Adviser

was

willing

to

continue

subsidizing

the

Funds

in

an

effort

to

support

growth

initiatives.

Based

on

these

and

other

applicable

considerations,

including

financial

statements

from

the

Adviser

indicating

its

profitability

and

expenses

from

overall

operations,

the

Board

concluded

that

the

Adviser’s

costs

of

services

and

profits

attributable

to

management

of

the

Funds

appeared

to

be

reasonable

in

light

of

the

nature,

extent

and

quality

of

the

services

provided

by

the

Adviser.

Economies

of

Scale

The

Board

evaluated

whether

the

Funds

were

benefitting,

or

may

benefit

in

the

future,

from

any

economies

of

scale.

In

this

respect,

the

Board

considered

the

Funds’

fee

structures,

asset

sizes,

and

net

expense

ratios.

The

Board

noted

the

Adviser’s

representation

that

economies

of

scale

could

be

experienced

if

the

Funds

were

to

reach

significantly

higher

asset

levels

but

that,

in

light

of

the

Funds’

current

asset

levels

and

the

Adviser’s

ongoing

subsidization

of

the

Funds,

breakpoints

in

the

advisory

fee

were

not

believed

by

the

Adviser

to

be

appropriate

at

this

time.

Based

on

the

foregoing

information

and

other

applicable

considerations,

the

Board

concluded

that

the

asset

levels

of

the

Funds

were

not

consistent

with

the

existence

of

economies

of

scale

and

that

economies

of

scale

were

not

a

material

factor

in

approving

the

continuation

of

the

Advisory

Agreement.

Other

Benefits

The

Board

noted

the

Adviser’s

representation

that,

aside

from

its

contractual

advisory

fees,

it

does

not

benefit

in

a

material

way

from

its

relationship

with

the

Funds.

Based

on

the

foregoing

representation

and

the

materials

presented,

the

Board

concluded

that

other

benefits

received

by

the

Adviser

from

its

relationship

with

the

Funds

were

not

a

material

factor

to

consider

in

approving

the

continuation

of

the

Advisory

Agreement.

Conclusion

The

Board

did

not

identify

any

single

factor

as

being

of

paramount

importance,

and

different

Trustees

may

have

given

different

weight

to

different

factors.

The

Board

reviewed

a

memorandum

from

Fund

counsel

discussing

the

legal

standards

applicable

to

its

consideration

of

the

Advisory

Agreement.

Based

on

its

review,

including

consideration

of

each

of

the

factors

referenced

above,

the

Board

determined,

in

the

exercise

of

its

reasonable

business

judgment,

that

the

advisory

arrangement,

as

outlined

in

the

Advisory

Agreement,

was

fair

and

reasonable

in

light

of

the

services

performed

or

to

be

performed,

expenses

incurred

or

to

be

incurred

and

such

other

matters

as

the

Board

considered

relevant.

Baywood

Funds

ADDITIONAL

INFORMATION

(Unaudited)

September

30,

2022

26

Liquidity

Risk

Management

Program

The

Funds

have

adopted

and

implemented

a

written

liquidity

risk

management

program,

as

required

by

Rule

22e-4

(the

“Liquidity

Rule”)

under

the

Investment

Company

Act

of

1940,

as

amended.

The

liquidity

risk

management

program

is

reasonably

designed

to

assess

and

manage

the

Fund’s

liquidity

risk,

taking

into

consideration,

among

other

factors,

the

Funds'

investment

strategy

and

the

liquidity

of

the

portfolio

investments

during

normal

and

reasonably

foreseeable

stressed

conditions,

its

short

and

long-term

cash

flow

projections

and

its

cash

holdings

and

access

to

other

funding

sources.

The

Board

approved

the

designation

of

the

Trust’s

Valuation

Committee

as

the

administrator

of

the

liquidity

risk

management

program

(the

“Program

Administrator”).

The

Program

Administrator

is

responsible

for

the

administration

and

oversight

of

the

program

and

for

reporting

to

the

Board

on

at

least

an

annual

basis

regarding,

among

other

things,

the

program’s

operation,

adequacy,

and

effectiveness.

The

Program

Administrator

assessed

the

Fund’s

liquidity

risk

profile

based

on

information

gathered

for

the

period

July

1,

2021

through

June

30,

2022

in

order

to

prepare

a

written

report

to

the

Board

for

review

at

its

meeting

held

on

September

16,

2022.

The

Program

Administrator’s

written

report

stated

that:

(i)

the

Funds

are

able

to

meet

redemptions

in

normal

and

reasonably

foreseeable

stressed

conditions

and

without

significant

dilution

of

remaining

shareholders’

interests

in

the

Funds;

(ii)

the

Funds'

strategy

is

appropriate

for

an

open-end

mutual

fund;

(iii)

the

liquidity

classification

determinations

regarding

the

Funds'

portfolio

investments,

which

take

into

account

a

variety

of

factors

and

may

incorporate

analysis

from

one

or

more

third-party

data

vendors,

remained

appropriate;

(iv)

the

Funds

did

not

approach

the

internal

triggers

set

forth

in

the

liquidity

risk

management

program

or

the

regulatory

percentage

limitation

(15%)

on

holdings

in

illiquid

investments;

(v)

it

continues

to

be

appropriate

to

not

set

a

“highly

liquid

investment

minimum”

for

the

Funds

because

the

Funds

primarily

hold

“highly

liquid

investments”;

and

(vi)

the

liquidity

risk

management

program

remains

reasonably

designed

and

adequately

implemented

to

prevent

violations

of

the

Liquidity

Rule.

No

significant

liquidity

events

impacting

the

Funds

or

proposed

changes

to

the

Program

were

noted

in

the

report.

Proxy

Voting

Information

A

description

of

the

policies

and

procedures

that

each

Fund

uses

to

determine

how

to

vote

proxies

relating

to

securities

held

in

each

Fund’s

portfolio

is

available,

without

charge

and

upon

request,

by

calling

(855)

409-2297

and

on

the

SEC’s

website

at

www.sec.gov.

Each

Fund’s

proxy

voting

record

for

the

most

recent

twelve-month

period

ended

June

30

is

available,

without

charge

and

upon

request,

by

calling

(855)

409-2297

and

on

the

SEC’s

website

at

www.sec.gov.

Availability

of

Quarterly

Portfolio

Schedules

Each

Fund

files

its

complete

schedule

of

portfolio

holdings

with

the

SEC

for

the

first

and

third

quarters

of

each

fiscal

year

on

Form

N-PORT.

Forms

N-PORT

are

available

free

of

charge

on

the

SEC’s

website

at

www.sec.gov.

Shareholder

Expense

Example

As

a

shareholder

of

the

Funds

,

you

incur

ongoing

costs,

including

management

fees,

and

other

Fund

expenses.

This

example

is

intended

to

help

you

understand

your

ongoing

costs

(in

dollars)

of

investing

in

the

Funds

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,

2022

through

September

30,

2022.

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

(for

example,

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

the

period.

Hypothetical

Example

for

Comparison

Purposes

–

The

second

line

of

the

table

below

provides

information

about

hypothetical

account

values

and

hypothetical

expenses

based

on

each

Fund’s

actual

expense

ratio

and

an

assumed

rate

of

return

of

5%

per

year

before

Baywood

Funds

ADDITIONAL

INFORMATION

(Unaudited)

September

30,

2022

27

expenses,

which

is

not

each

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

each

Fund

and

other

funds.

To

do

so,

compare

this

5%

hypothetical

example

with

the

5%

hypothetical

examples

that

appear

in

the

shareholder

reports

of

other

funds.

Please

note

that

the

expenses

shown

in

the

table

are

meant

to

highlight

your

ongoing

costs

only.

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.

Federal

Tax

Status

of

Dividends

Declared

during

the

Fiscal

Year

For

federal

income

tax

purposes,

dividends

from

short-term

capital

gains

are

classified

as

ordinary

income.

Baywood

Valu

ePlus

Fund

and

Baywood

Sociall

yResponsible

Fund

designate

99.43%

and

82.35

%

of

its

income

dividend

distributed

as

qualifying

for

the

corporate

dividends-received

deduction

(DRD)

and

100.00%

and

89.70

%

for

the

qualified

dividend

rate

(QDI)

and

the

Baywood

Sociall

yResponsible

Fund

also

designates

43.19%

as

short-term

capital

gain

dividends

exempt

from

U.S.

tax

for

foreign

shareholders

(QSD)

defined

in

Section

1(h)(11)

of

the

Internal

Revenue

Code,

respectively.

Pursuant

to

Section

852(b)(3)

of

the

Internal

Revenue

Code,

Baywood

Valu

ePlus

Fund

and

Baywood

Sociall

yResponsible

Fund

designated

$257,240

and

$119,098

as

long-term

capital

gain

dividends,

respecively.

Trustees

and

Officers

of

the

Trust

The

Board

is

responsible

for

oversight

of

the

management

of

the

Trust’s

business

affairs

and

of

the

exercise

of

all

the

Trust’s

powers

except

those

reserved

for

the

shareholders.

The

following

table

provides

information

about

each

Trustee

and

certain

officers

of

the

Trust.

Each

Trustee

and

officer

holds

office

until

the

person

resigns,

is

removed,

or

is

replaced.

Unless

otherwise

noted,

the

persons

have

held

their

principal

occupations

for

more

than

five

years.

The

address

for

all

Trustees

and

officers

is

Three

Canal

Plaza,

Suite

600,

Portland,

Maine

04101.

Each

Fund’s

Statement

of

Additional

Information

includes

additional

information

about

the

Trustees

and

is

available,

without

charge

and

upon

request,

by

calling

(855)

409-2297.

Beginning

Account

Value

April

1,

2022

Ending

Account

Value

September

30,

2022

Expenses

Paid

During

Period*

Annualized

Expense

Ratio*

Baywood

Value

Plus

Fund

Actual

$

1,000.00‌

$

859.42‌

$

3.26‌

0.70%‌

Hypothetical

(5%

return

before

expenses)

$

1,000.00‌

$

1,021.56‌

$

3.55‌

0.70%‌

Baywood

Socially

Responsible

Fund

Actual

$

1,000.00‌

$

858.88‌

$

4.15‌

0.89%‌

Hypothetical

(5%

return

before

expenses)

$

1,000.00‌

$

1,020.61‌

$

4.51‌

0.89%‌

*

Expenses

are

equal

to

the

Fund’s

annualized

expense

ratio

multiplied

by

the

average

account

value

over

the

period,

multiplied

by

the

number

of

days

in

the

most

recent

fiscal

half-year

(183)

divided

by

365

to

reflect

the

half-year

period.

Name

and

Year

of

Birth

Position

with

the

Trust

Length

of

Time

Served

Principal

Occupation(s)

During

Past

Five

Years

Number

of

Series

in

Fund

Complex

Overseen

By

Trustee

Other

Directorships

Held

By

Trustee

During

Past

Five

Years

Independent

Trustees

David

Tucker

Born:

1958

Chairman

of

the

Board;

Trustee;

Chairman,

Nominating

Committee

and

Qualified

Legal

Compliance

Committee

Since

2013

Director,

Blue

Sky

Experience

(a

charitable

endeavor),

since

2008;

Senior

Vice

President

&

General

Counsel,

American

Century

Companies

(an

investment

management

firm),

1998-

2008.

2

Trustee,

Forum

Funds;

Trustee,

U.S.

Global

Investors

Funds.

Baywood

Funds

ADDITIONAL

INFORMATION

(Unaudited)

September

30,

2022

28

(1)

Jessica

Chase

is

currently

an

interested

person

of

the

Trust,

as

defined

in

the

1940

Act,

due

to

her

affiliation

with

Apex

Fund

Services

and

her

role

as

President

of

the

Trust.

Apex

Fund

Services

is

a

wholly

owned

subsidiary

of

Apex

US

Holdings

LLC.

Name

and

Year

of

Birth

Position

with

the

Trust

Length

of

Time

Served

Principal

Occupation(s)

During

Past

Five

Years

Number

of

Series

in

Fund

Complex

Overseen

By

Trustee

Other

Directorships

Held

By

Trustee

During

Past

Five

Years

Mark

D.

Moyer

Born:

1959

Trustee;

Chairman

Audit

Committee

Since

2013

Chief

Financial

Officer,

Freedom

House

(a

NGO

advocating

political

freedom

and

democracy),

2017-2021;

independent

consultant

providing

interim

CFO

services,

principally

to

non-profit

organizations,

2011-2017.

2

Trustee,

Forum

Funds;

Trustee,

U.S.

Global

Investors

Funds.

Jennifer

Brown-Strabley

Born:

1964

Trustee

Since

2013

Principal,

Portland

Global

Advisors

(a

registered

investment

adviser),

1996-

2010.

2

Trustee,

Forum

Funds;

Trustee,

U.S.

Global

Investors

Funds.

Interested

Trustees

(1)

Jessica

Chase

Born:

1970

Trustee

Since

2019

Director,

Apex

Fund

Services

since

2019;

Senior

Vice

President,

Atlantic

Fund

Services

2008-2019.

2

Trustee,

Forum

Funds,

Trustee,

U.S.

Global

Investors

Funds.

Name

and

Year

of

Birth

Position

with

the

Trust

Length

of

Time

Served

Principal

Occupation(s)

During

Past

5

Years

Officers

Jessica

Chase

Born:

1970

President;

Principal

Executive

Officer

Since

2015

Director,

Apex

Fund

Services

since

2019;

Senior

Vice

President,

Atlantic

Fund

Services

2008-2019.

Karen

Shaw

Born:

1972

Treasurer;

Principal

Financial

Officer

Since

2013

Senior

Vice

President,

Apex

Fund

Services

since

2019;

Senior

Vice

President,

Atlantic

Fund

Services

2008-2019.

Zachary

Tackett

Born:

1988

Vice

President;

Secretary

and

Anti-

Money

Laundering

Compliance

Officer

Since

2014

Senior

Counsel,

Apex

Fund

Services

since

2019;

Counsel,

Atlantic

Fund

Services

2014-

2019.

Timothy

Bowden

Born:

1969

Vice

President

Since

2013

Manager,

Apex

Fund

Services

since

2019;

Manager,

Atlantic

Fund

Services

2008-2019.

Michael

J.

McKeen

Born:

1971

Vice

President

Since

2013

Senior

Vice

President,

Apex

Fund

Services

since

2019;

Senior

Vice

President,

Atlantic

Fund

Services

2008-2019.

Geoffrey

Ney

Born:

1975

Vice

President

Since

2013

Manager,

Apex

Fund

Services

since

2019;

Manager,

Atlantic

Fund

Services

2013-2019.

Carlyn

Edgar

Born:

1963

Chief

Compliance

Officer

Since

2013

Senior

Vice

President,

Apex

Fund

Services

since

2019;

Senior

Vice

President,

Atlantic

Fund

Services

2008-2019.

FOR

MORE

INFORMATION:

P.O.

Box

588

Portland,

ME

04112

(855)

409-2297

(toll

free)

INVESTMENT

ADVISOR

SKBA

Capital

Management,

LLC

601

California

Street,

Suite

1500

San

Francisco,

CA

94108

TRANSFER

AGENT

Apex

Fund

Services

P.O.

Box

588

Portland,

ME

04112

www.apexgroup.com

DISTRIBUTOR

Foreside

Fund

Services,

LLC

Three

Canal

Plaza,

Suite

100

Portland,

ME

04101

www.foreside.com

This

report

is

submitted

for

the

general

information

of

the

shareholders

of

the

Funds.

It

is

not

authorized

for

distribution

to

prospective

investors

unless

preceded

or

accompanied

by

an

effective

prospectus,

which

includes

information

regarding

the

Funds’

risks,

objectives,

fees

and

expenses,

experience

of

its

management,

and

other

information.

217-ANR-0922

ITEM 2. CODE OF ETHICS.

(a)As of the end of the period covered by this report, Forum Funds II (the “Registrant”) has adopted a code of ethics, which applies to its Principal Executive Officer and Principal Financial Officer (the “Code of Ethics”).

(c)       There have been no amendments to the Registrant’s Code of Ethics during the period covered by this report.

(d)       There have been no waivers to the Registrant’s Code of Ethics during the period covered by this report.

(e)        Not applicable.

(f) (1)  A copy of the Code of Ethics is being filed under Item 13(a) hereto.

ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.

The Board of Trustees has determined that Mr. Mark Moyer is an "audit committee financial expert" as that term is defined under applicable regulatory guidelines. Mr. Moyer is a non- “interested” Trustee (as defined in Section 2(a)(19) under the Investment Company Act of 1940, as amended (the “Act”)), and serves as Chairman of the Audit Committee.

ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.

(a) Audit Fees - The aggregate fees billed for each of the last two fiscal years (the “Reporting Periods”) for professional services rendered by the Registrant’s principal accountant for the audit of the Registrant’s annual financial statements, or services that are normally provided by the principal accountant in connection with the statutory and regulatory filings or engagements for the Reporting Periods, were $26,800 in 2021 and $26,800 in 2022.

(b) Audit-Related Fees – The aggregate fees billed in the Reporting Periods for assurance and related services rendered by the principal accountant that were reasonably related to the performance of the audit of the Registrant’s financial statements and are not reported under paragraph (a) of this Item 4 were $0 in 2021 and $0 in 2022. 

(c) Tax Fees - The aggregate fees billed in the Reporting Periods for professional services rendered by the principal accountant to the Registrant for tax compliance, tax advice and tax planning were $6,000 in 2021 and $6,000 in 2022.  These services consisted of review or preparation of U.S. federal, state, local and excise tax returns. 

(d) All Other Fees - The aggregate fees billed in the Reporting Periods for products and services provided by the principal accountant to the Registrant, other than the services reported in paragraphs (a) through (c) of this Item, were $0 in 2021 and $0 in 2022. 

(e) (1) The Audit Committee reviews and approves in advance all audit and “permissible non-audit services” (as that term is defined by the rules and regulations of the Securities and Exchange Commission) to be rendered to a series of the Registrant (each, a “Series”).  In addition, the Audit Committee reviews and approves in advance all “permissible non-audit services” to be provided to an investment adviser (not including any sub-adviser) of a Series, or an affiliate of such investment adviser, that is controlling, controlled by or under common control with the investment adviser and provides on-going services to the Registrant (“Affiliate”), by the Series’ principal accountant if the engagement relates directly to the operations and financial reporting of the Series.  The Audit Committee considers whether fees paid by a Series’ investment adviser or an Affiliate to the Series’ principal accountant for audit and permissible non-audit services are consistent with the principal accountant’s independence.

(e) (2) No services included in (b) - (d) above were approved pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.

(f) Not applicable

(g) The aggregate non-audit fees billed by the principal accountant for services rendered to the Registrant for the Reporting Periods were $0 in 2021 and $0 in 2022.  There were no fees billed in either of the Reporting Periods for non-audit services rendered by the principal accountant to the Registrant’s investment adviser or any Affiliate.

(h) During the Reporting Period, the Registrant's principal accountant provided no non-audit services to the investment advisers or any entity controlling, controlled by or under common control with the investment advisers to the series of the Registrant to which this report relates.

ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.

Not applicable

ITEM 6. INVESTMENTS.

(a)Included as part of report to shareholders under Item 1.

(b)Not applicable.

ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END

MANAGEMENT INVESTMENT COMPANIES.

Not applicable.

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

Not applicable.

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 HOLDERS

The Registrant does not accept nominees to the board of trustees from shareholders.

ITEM 11. CONTROLS AND PROCEDURES

(a) The Registrant’s Principal Executive Officer and Principal Financial Officer have concluded that the Registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Act are effective, based on their evaluation of the controls and procedures required by Rule 30a-3(b) under the Act and Rules 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934, as of a date within 90 days of the filing date of this report.

 (b) There were no changes in the Registrant’s internal control over financial reporting (as defined in

Rule 30a-3(d) under the Act) that occurred during 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. DISCLOSURE OF SECURITIES LENDING ACTIVITIES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES

Not applicable.

ITEM 13. EXHIBITS.

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

(a)(2) Certifications pursuant to Rule 30a-2(a) of the Act, and Section 302 of the Sarbanes-Oxley Act of 2002. (Exhibits filed herewith)

(a)(3)  Not applicable.

(b)      Certifications pursuant to Rule 30a-2(b) of the Act, and Section 906 of the Sarbanes-Oxley Act of 2002. (Exhibit 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              Forum Funds II

By:	/s/ Jessica Chase
	Jessica Chase, Principal Executive Officer
Date:	November 18, 2022

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.

By:	/s/ Jessica Chase
	Jessica Chase, Principal Executive Officer
Date:	November 18, 2022

By:	/s/ Karen Shaw
	Karen Shaw, Principal Financial Officer
Date:	November 18, 2022