SEMIANNUAL
REPORT
MARCH 31, 1998
TIP FUNDS [LOGO OMITTED]
TRUSTED INSTITUTIONAL PARTNERS
================================================================================
TIP Target Select Equity Fund
================================================================================
<PAGE>
CONTENTS
- --------------------------------------------------------------------------------
2 Total Returns and Fund Investment Objective
3 Letter to Shareholders
5 Financial Statements
TIP FUNDS
- --------------------------------------------------------------------------------
The TIP Funds offer a series of 12 no-load mutual funds to individual and
institutional investors. The minimum initial investment in a TIP Fund for
regular accounts is $2,500 and $2,000 for individual retirement accounts.
The minimum amount for subsequent investments is $500.
Turner Investment Partners, Inc., based in Berwyn, Pennsylvania, serves as
the investment adviser to six of the TIP Funds. The firm, founded in 1990,
invests more than $2.8 billion in equity, fixed-income, and balanced portfolios
on behalf of individuals and institutions. Turner Investment Partners advises
the TIP Target Select Equity Fund, the Turner Growth Equity Fund, the Turner
Midcap Growth Fund, the Turner Small Cap Growth Fund, the Turner Ultra Large Cap
Growth Fund, and the Turner Fixed Income Fund.
Turner also advises three TIP Institutional Funds: the Turner Micro Cap
Growth Fund, the Turner Short Duration Funds-One Year Portfolio, and the Turner
Short Duration Funds-Three Year Portfolio. Separate investment firms manage the
other mutual funds in the TIP Funds family.
SHAREHOLDER SERVICES
- --------------------------------------------------------------------------------
TIP Funds shareholders receive annual and semiannual reports and monthly
account statements. Shareholders who have questions about their accounts may
call a toll-free telephone number, 1-800-224-6312. Or they may write to TIP
Funds, Box 419805, Kansas City, Missouri 64141.
<PAGE>
TOTAL RETURNS*
- --------------------------------------------------------------------------------
Periods ended March 31, 1998
THREE SINCE
MONTHS INCEPTION**
- --------------------------------------------------------------------------------
TIP TARGET SELECT EQUITY FUND 18.52% 18.52%
S&P 500 Index 13.94 13.94
*Past performance cannot guarantee future results. The investment return and
principal value of an investment will fluctuate, so that an investor's shares,
when redeemed, may be worth more or less than their original cost.
**The inception date for the TIP Target Select Equity Fund is January 1, 1998.
FUND INVESTMENT OBJECTIVE
- --------------------------------------------------------------------------------
The TIP TARGET SELECT EQUITY FUND seeks long-term growth of capital. It
invests primarily in U.S. stocks. Each investment firm chosen to manage assets
in the fund invests in a maximum of 20 stocks and as few as 10 stocks that they
believe have the greatest return potential. Such a focused stock-selection
process permits the firms to act on only the investment ideas that they think
are the strongest. In the process, the Fund provides two levels of
diversification: diversification in total holdings and diversification in
investment styles.
2
<PAGE>
TO OUR SHAREHOLDERS:
- --------------------------------------------------------------------------------
If well-begun is in fact half-done, then the TIP Target Select Equity Fund is
auspiciously on its way to achieving a laudable investment performance in 1998.
In its first three months of operation, Target Select got off to a strong
start, with a return of 18.52% -- a gain in one quarter that would normally be a
premium return for one year. Target Select's result trumped a potent performance
of the S&P 500 Index by 4.58 percentage points. (As these figures imply, it was
the best quarter for stocks in 11 years.) What's more, Target Select
outperformed the Lipper Domestic Equity Funds Average by 7.02 percentage points.
In essence, Target Select did what it was designed to do -- capitalize on
the 20 best investment ideas of each firm managing assets in the fund and
combine each firm's own unique investment style to smooth the overall return.
Currently two firms are managing Target Select's assets: Turner Investment
Partners and Chartwell Investment Partners. Turner invests in growth stocks with
strong earnings prospects, while Chartwell invests in value stocks with
above-average dividend yields and below-average price/earnings ratios.
INVESTMENT STYLES MESH WELL
In terms of smoothing Target Select's overall return, Turner's
growth-investing style and Chartwell's value-investing style meshed well. In the
past three months, the S&P 500 recorded 24 days of negative returns. In
comparison, Turner and Chartwell's styles proved an effective risk-dampening
mechanism that resulted in Target Select posting only 19 days of negative
returns.
Turner's growth style in particular was advantageous in a period when
growth stocks beat value stocks across all capitalization segments. For
instance, the broad-based Russell 3000 Growth Index outperformed the Russell
3000 Value Index by 3.50 percentage points. In the future, in periods when value
stocks predominate, Chartwell's value style will likely be similarly beneficial.
Both firms contributed positive returns. About 60% of Turner's holdings
were concentrated in three market sectors, technology, producer durables, and
health care, which generated double-digit gains. For Chartwell, about 60% of its
holdings were in three sectors, financial services, capital goods, and consumer
cyclical, which helped produce a result more than two percentage points above
that of the firm's institutional accounts.
PORTFOLIOS CONTRAST
The Target Select holdings offer an intriguing study in contrasts. For one
thing, as noted, each firm's three largest sector weightings differ. For
another, the characteristics of each firm's individual holdings diverge
dramatically. Turner's holdings -- stocks like United Rentals, Cisco Systems,
Microsoft, and Applied Materials -- have a lofty price/earnings ratio of 29.8,
based on Wall Street's consensus earnings forecast for the next 12 months
(versus the S&P 500's 22.1 P/E ratio), an above-average expected earnings-growth
rate of 17.2% over the next 12 months (versus a 10.8% rate for the S&P 500), and
a paltry dividend yield of 0.4% (versus 1.4% for the S&P 500.) At the other
pole, Chartwell's positions -- stocks like Bristol-Myers Squibb, Mellon Bank,
McGraw-Hill, and Starwood Hotels & Resorts Trust -- have a below-average
price/earnings ratio of 19.6, an expected
3
<PAGE>
earnings-growth rate of 15% for 1998 and 1999, and a dividend yield of 2.2%
that's 57% above the S&P 500 average.
Turner's strategy was, and is, to focus on stocks of companies with the
most attractive earnings prospects in the short and intermediate term or stocks
that have declined in price more than is justified in light of the companies'
earnings prospects. Initially Turner has tended to buy the
largest-capitalization stocks, which have been in favor for the past three
years. Turner's forte is stock selection and employs a team approach to
investing, with its portfolio managers/analysts covering the 10 market sectors
and making investment recommendations in their sectors. In Turner's estimation,
its substantial contribution to Target Select's return can be attributed to
prowess at picking stocks. Some of Turner's best-performing picks were
Warner-Lambert, DuPont, and General Electric.
Chartwell's strategy was, and is, to focus on stocks that are undervalued
in relation to the companies' long-term earnings power and that provide an ample
dividend yield as protection against market downdrafts. Chartwell is especially
interested in stocks of companies that, in its estimation, will reap good
returns on capital -- a prime measure of a company's ability to enhance its
financial performance. For instance, Chartwell is avoiding paper and railroad
stocks that at first glance may appear to be bargains. The reason for this
aversion to paper and railroad stocks: the companies are likely to earn less
than the cost of capital, in Chartwell's judgment. Chartwell likewise uses a
team approach in managing portfolios, covering sectors, and making investment
recommendations. Its best-performing stock selections were Xerox and True North
Communications.
OUR MARKET OUTLOOK: POSITIVE
Looking ahead, both Turner and Chartwell think the economic backdrop in
1998 should be conducive to stock prices in aggregate moving higher. The reason
for our positive market outlook: if the present isn't the best of all possible
worlds for U.S. stocks, it's close. The quality of earnings has never been
higher. U.S. corporations continue to enhance their competitiveness and earnings
power with restructuring programs, acquisitions, and applications of new
technology, all of which are in turn helping to produce returns on equity that
are the envy of the world. Interest rates and inflation are low and stable, a
throwback to the 1950s. Stocks figure to benefit for a long time to come from
demand by a mighty demographic force: baby boomers investing heavily in 40l(k)
and Keogh plans and Individual Retirement Accounts to prepare for retirement.
And the economy continues to grow; the current expansion has turned seven years
old, with no recession yet in sight.
In closing, we are committed to delivering superior investment returns and
service to you, our shareholders. We welcome your questions or comments.
/S/Signature
Robert E. Turner
PORTFOLIO MANAGER
TURNER INVESTMENT PARTNERS, INC.
/S/Signature
Harold A. Ofstie
PORTFOLIO MANAGER
CHARTWELL INVESTMENT PARTNERS
4
<PAGE>
SCHEDULE OF INVESTMENTS TIP FUNDS
March 31, 1998 (Unaudited)
Market
TIP TARGET SELECT Value
EQUITY FUND Shares (000)
- -------------------------------------------------------
COMMON STOCKS (89.0%)
AEROSPACE & DEFENSE (2.2%)
Gencorp 580 $ 18
----
AUTOMOTIVE (2.9%)
Dial 1,000 24
----
BANKS (6.4%)
Compass Bancshares 85 4
First American of Tennessee 370 18
Mellon Bank 250 16
U.S. Bancorp 120 15
----
53
----
BROADCASTING, NEWSPAPERS, AND ADVERTISING (2.4%)
True North Communications 610 20
----
CHEMICALS (1.8%)
E.I. duPont de Nemours 225 15
----
COMPUTERS AND SERVICES (5.2%)
Cisco Systems* 400 27
Minnesota Mining & Manufacturing 180 16
----
43
----
DRUGS (6.1%)
American Home Products 175 17
Bristol-Myers Squibb 165 17
Warner Lambert 100 17
----
51
----
ENTERTAINMENT (2.5%)
Walt Disney 200 21
----
FINANCIAL SERVICES (6.2%)
Boston Properties 460 16
Fannie Mae 325 21
Starwood Lodging Trust 288 15
----
52
----
FOOD, BEVERAGE, AND TOBACCO (6.1%)
Canandaigua Wine, Cl A* 325 19
Philip Morris 350 15
Universal Foods 340 17
----
51
----
Market
Value
Shares (000)
- -------------------------------------------------------
GAS/NATURAL GAS (1.9%)
Enron 345 $ 16
----
HOUSEHOLD PRODUCTS (2.3%)
Clorox 225 19
----
INSURANCE (2.2%)
American General 275 18
----
LEASING AND RENTING (4.6%)
Pitney Bowes 345 17
United Rentals* 800 21
----
38
----
MACHINERY (5.2%)
Applied Materials* 650 23
Emerson Electric 300 20
----
43
----
MEDICAL PRODUCTS AND SERVICES (5.4%)
Boston Scientific* 275 19
Medtronic 500 26
----
45
----
MISCELLANEOUS BUSINESS SERVICES (7.8%)
DST Systems* 350 18
Electronic Data Systems 425 20
Microsoft* 300 27
----
65
----
PETROLEUM AND FUEL PRODUCTS (1.9%)
YPF S.A. ADR 470 16
----
PHOTOGRAPHIC EQUIPMENT AND SUPPLIES (2.2%)
Xerox 165 18
----
PRINTING AND PUBLISHING (2.0%)
McGraw-Hill 225 17
----
PROFESSIONAL SERVICES (2.5%)
International Network Services* 700 21
----
SEMICONDUCTORS/INSTRUMENTS (5.0%)
Intel 400 31
Texas Instruments 210 11
----
42
----
The accompanying notes are an integral part of the financial statements.
5
<PAGE>
SCHEDULE OF INVESTMENTS TIP FUNDS
March 31, 1998 (Unaudited)
Shares/Face Market
TIP TARGET SELECT Amount Value
EQUITY FUND (Concluded) (000) (000)
- -------------------------------------------------------
STEEL AND STEEL WORKS (1.8%)
Allegheny Teledyne 555 $ 15
----
TELEPHONES AND TELECOMMUNICATION (2.4%)
Intermedia Communications
of Florida* 250 20
----
TOTAL COMMON STOCKS
(Cost $712) 741
----
REPURCHASE AGREEMENT (11.0%)
Morgan Stanley
5.25%, dated 03/31/98,
matures 04/01/98, repurchase
price $92,099 (collateralized by
U.S. Treasury Note, 5.375%,
05/31/98, market
value $94,416) $92 92
----
TOTAL REPURCHASE AGREEMENT
(Cost $92) 92
----
TOTAL INVESTMENTS (100.0%)
(Cost $804) $833
====
*NON-INCOME PRODUCING SECURITY
ADR -- AMERICAN DEPOSITORY RECEIPT
CL -- CLASS
The accompanying notes are an integral part of the financial statements.
6
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES (000) TIP FUNDS
March 31, 1998 (Unaudited)
<TABLE>
<CAPTION>
TIP TARGET
SELECT EQUITY
FUND
- -----------------------------------------------------------------------------------------------------------------
<S> <C>
Assets:
Investment Securities at Value (Cost $804).................................. $ 833
Capital Shares Sold Receivable.............................................. --
Receivable for Investment Securities Sold .................................. 126
Income Receivable .......................................................... 1
Other Assets ............................................................... --
- -----------------------------------------------------------------------------------------------------------------
Total Assets ............................................................. 960
- -----------------------------------------------------------------------------------------------------------------
Liabilities:
Payable for Investment Securities Purchased ................................ (209)
Accrued Expenses ........................................................... (7)
Capital Shares Redeemed Payable ............................................ --
Other Liabilities........................................................... --
- -----------------------------------------------------------------------------------------------------------------
Total Liabilities ........................................................ (216)
- -----------------------------------------------------------------------------------------------------------------
Net Assets:
Portfolio shares (unlimited authorization -- no par value) based on
62,771 outstanding shares of beneficial interest ......................... 628
Undistributed Net Investment Income......................................... --
Accumulated Net Realized Gain on Investments ............................... 87
Net Unrealized Appreciation of Investments ................................. 29
- -----------------------------------------------------------------------------------------------------------------
Total Net Assets ......................................................... $ 744
=================================================================================================================
Net Asset Value, Offering Price, and Redemption Price Per Share ............... $11.85
=================================================================================================================
<FN>
Amounts designated as "--" are either $0 or have been rounded to $0.
</FN>
</TABLE>
The accompanying notes are an integral part of the financial statements.
7
<PAGE>
STATEMENT OF OPERATIONS (000) TIP FUNDS
(Unaudited)
<TABLE>
<CAPTION>
TIP TARGET SELECT
EQUITY FUND
------------------
FOR THE
PERIOD 1/1/98
THROUGH 3/31/98(1)
- ------------------------------------------------------------------------------------------------------------------
<S> <C>
Investment Income:
Dividends ............................................................................... $ 1
Interest ................................................................................ 1
- ------------------------------------------------------------------------------------------------------------------
Total Investment Income................................................................ 2
- ------------------------------------------------------------------------------------------------------------------
Expenses:
Investment Advisory Fees ................................................................ 1
Investment Advisory Fee Waiver .......................................................... (1)
Reimbursements by Advisor................................................................ (20)
Administrator Fees ...................................................................... --
Custodian Fees .......................................................................... 1
Transfer Agent Fees ..................................................................... 5
Professional Fees ....................................................................... 3
Trustee Fees ............................................................................ --
Registration Fees ....................................................................... 8
Pricing Fees ............................................................................ 1
Printing Fees ........................................................................... 2
Amortization of Deferred
Organizational Costs .................................................................. 1
Insurance and Other Fees ................................................................ 1
- ------------------------------------------------------------------------------------------------------------------
Total Expenses ........................................................................ 2
- ------------------------------------------------------------------------------------------------------------------
Net Investment Income ............................................................. --
- ------------------------------------------------------------------------------------------------------------------
Net Realized Gain From Securities Sold .................................................. 87
Net Unrealized Appreciation of Investment Securities .................................... 29
- ------------------------------------------------------------------------------------------------------------------
Net Realized and Unrealized Gain on Investments ......................................... 116
- ------------------------------------------------------------------------------------------------------------------
Net Increase in Net Assets Resulting From Operations .................................... $116
==================================================================================================================
<FN>
(1) The TIP Target Select Equity Fund began operations on January 1, 1998.
Amounts designated as "--" are either $0 or have been rounded to $0.
</FN>
</TABLE>
The accompanying notes are an integral part of the financial statements.
8
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS (000) TIP FUNDS
(Unaudited)
<TABLE>
<CAPTION>
TIP TARGET
SELECT EQUITY FUND
-------------------
FOR THE
PERIOD 1/1/98
THROUGH 3/31/98(1)
- ----------------------------------------------------------------------------------------------------------------
<S> <C>
Investment Activities:
Net Investment Income .................................................................. $ --
Net Realized Gain on Securities Sold ................................................... 87
Net Unrealized Appreciation of Investment Securities ................................... 29
- ----------------------------------------------------------------------------------------------------------------
Net Increase in Net Assets Resulting from Operations ................................. 116
- ----------------------------------------------------------------------------------------------------------------
Distributions to Shareholders:
Net Investment Income .................................................................. --
Realized Capital Gain .................................................................. --
- ----------------------------------------------------------------------------------------------------------------
Total Distributions .................................................................. --
- ----------------------------------------------------------------------------------------------------------------
Capital Share Transactions:
Proceeds from Shares Issued ............................................................ 628
Proceeds from Shares Issued in Lieu of Cash Distributions .............................. --
Cost of Shares Redeemed ................................................................ --
- ----------------------------------------------------------------------------------------------------------------
Increase in Net Assets From Capital Share Transactions ............................... 628
- ----------------------------------------------------------------------------------------------------------------
Total Increase in Net Assets ......................................................... 744
- ----------------------------------------------------------------------------------------------------------------
Net Assets:
Beginning of Period .................................................................. --
- ----------------------------------------------------------------------------------------------------------------
End of Period ........................................................................ $744
================================================================================================================
Shares Issued and Redeemed:
Issued ................................................................................. 63
Issued in Lieu of Cash Distributions ................................................... --
Redeemed ............................................................................... --
- ----------------------------------------------------------------------------------------------------------------
Net Increase in Share Transactions ................................................... $ 63
================================================================================================================
<FN>
(1) The TIP Target Select Equity Fund began operations on January 1, 1998.
Amounts designated as "--" are either $0 or have been rounded to $0.
</FN>
</TABLE>
The accompanying notes are an integral part of the financial statements.
9
<PAGE>
FINANCIAL HIGHLIGHTS TIP FUNDS
For a Share Outstanding Throughout Each Period
<TABLE>
<CAPTION>
Net Net Net
Asset Realized and Distributions Distributions Asset Assets Ratio
Value Net Unrealized from Net from Value End of Expenses
Beginning Investment Gains on Investment Capital End of Period to Average
of Period Income Investments Income Gains of Period Total Return(1) (000) Net Assets
--------- ---------- ------------ ------------- ------------- --------- --------------- --------- -----------
- -----------------------------
TIP TARGET SELECT EQUITY FUND
- -----------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1998(3) $10.00 -- 1.85 -- -- $11.85 18.52% $ 744 1.30%*
Ratio of Net
Ratio of Investment
Ratio of Net Expenses Income to
Investment to Average Average
Income Net Assets Net Assets Portfolio Average
to Average (Excluding (Excluding Turnover Commission
Net Assets Waivers) Waivers) Rate Rate(2)
------------ ---------- ------------ --------- ----------
- -----------------------------
TIP TARGET SELECT EQUITY FUND
- -----------------------------
<S> <C> <C> <C> <C> <C>
1998(3) 0.33%* 20.70%* (19.07)%* 311.02% $0.0505
<FN>
* Annualized
(1) Returns are for the period indicated and have not been annualized.
(2) Average commission rate paid per share for security purchases and sales during the period.
Presentation of the rate is only required for fiscal years beginning after September 1, 1995.
(3) The TIP Target Select Equity Fund began operations on January 1, 1998.
Amounts designated as "--" are either $0 or have been rounded to $0.
</FN>
</TABLE>
The accompanying notes are an integral part of the financial statements.
10
<PAGE>
NOTES TO FINANCIAL STATEMENTS TIP FUNDS
March 31, 1998 (Unaudited)
1. ORGANIZATION:
TIP FUNDS (the "Trust") a Massachusetts business trust, is registered under the
Investment Company Act of 1940, as amended, as a diversified open-end management
investment company with 12 portfolios. The financial statement included herein
is for the TIP Target Select Equity Fund (the "Target Select Equity Fund") (the
"Fund"). The financial statements of the remaining portfolios are presented
separately. The assets of each fund are segregated, and a shareholder's interest
is limited to the portfolio in which shares are held. The Fund's prospectus
provides a description of the Fund's investment objectives, policies, and
strategies.
2. SIGNIFICANT ACCOUNTING POLICIES:
The following is a summary of the significant accounting policies followed by
the Fund.
SECURITY VALUATION -- Investments in equity securities which are traded on
a national exchange (or reported on the NASDAQ national market system) are
stated at the last quoted sales price if readily available for such equity
securities on each business day; other equity securities traded in the
over-the-counter market and listed equity securities for which no sale was
reported on that date are stated at the last quoted bid price. Debt
obligations exceeding 60 days to maturity for which market quotations are
readily available are valued at the most recently quoted bid price. Debt
obligations with 60 days or less remaining until maturity may be valued at
their amortized cost, which approximates market value.
FEDERAL INCOME TAXES -- It is the Fund's intention to qualify as a
regulated investment company by complying with the appropriate provisions
of the Internal Revenue Code of 1986, as amended. Accordingly, no provision
for Federal income taxes is required.
SECURITY TRANSACTIONS AND RELATED INCOME -- Security transactions are
accounted for on the date the security is purchased or sold (trade date).
Dividend income is recognized on the ex-dividend date, and interest income
is recognized on the accrual basis. Costs used in determining realized
gains and losses on the sales of investment securities are those of the
specific securities sold during the respective holding period.
NET ASSET VALUE PER SHARE -- The net asset value per share of the Fund is
calculated on each business day, by dividing the total value of the Fund's
assets, less liabilities, by the number of shares outstanding.
REPURCHASE AGREEMENTS -- Securities pledged as collateral for repurchase
agreements are held by the custodian bank until the respective agreements
mature. Provisions of the repurchase agreements ensure that the market
value of the collateral, including accrued interest thereon, is sufficient
in the event of default of the counterparty. If the counterparty defaults
and the value of the collateral declines or if the counterparty enters an
insolvency proceeding, realization of the collateral by the Fund may be
delayed or limited.
EXPENSES -- Expenses that are directly related to the Fund are charged to
the Fund. Other operating expenses of the Trust are prorated to the Funds
on the basis of relative daily net assets.
DISTRIBUTIONS TO SHAREHOLDERS -- Distributions from net investment income
are declared and paid to Shareholders on a quarterly basis. Any net
realized capital gains on sales of securities are distributed to
Shareholders at least annually.
11
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Continued) TIP FUNDS
March 31, 1998 (Unaudited)
Dividends from net investment income and distributions from net realized
capital gains are determined in accordance with U.S. Federal income tax
regulations, which may differ from those amounts determined under generally
accepted accounting principles. These book/tax differences are either
temporary or permanent in nature. To the extent these differences are
permanent, they are charged or credited to paid-in-capital or accumulated
net realized gain, as appropriate, in the period that the differences
arise.
USE OF ESTIMATES -- The preparation of financial statements in
conformity with generally accepted accounting principles requires
management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements, and the reported
amounts of income and expenses during the reported period. Actual results
could differ from those estimates.
3. TRANSACTIONS WITH AFFILIATES:
Certain officers of the Trust are also officers of SEI Fund Resources (the
"Administrator") and/or SEI Investments Distribution Co. (the "Distributor").
Such officers are paid no fees by the Trust for serving as officers and trustees
of the Trust.
4. ADMINISTRATION, SHAREHOLDER SERVICING, AND DISTRIBUTION AGREEMENTS:
The Trust and the Administrator are parties to an agreement under which the
Administrator provides management and administrative services for an annual fee
of 0.12% of the average daily net assets of the Fund up to $75 million, 0.10% on
the next $75 million, 0.09% on the next $150 million, 0.08% on the next $300
million, and 0.075% of such assets in excess on $600 million. There is a minimum
annual fee of $75,000 per Fund payable to the Administrator for services
rendered to the Fund under the Administration Agreement. During fiscal 1998, the
Administrator has voluntarily waived a portion of its fee.
DST Systems, Inc., (the "Transfer Agent"), serves as the transfer agent and
dividend disbursing agent for the Fund under a transfer agency agreement with
the Trust.
The Trust and the Distributor are parties to a Distribution Agreement dated
April 30, 1996. The Distributor receives no fees for its distribution services
under this agreement.
5. INVESTMENT ADVISORY AND CUSTODIAN AGREEMENTS:
The Trust and Turner Investment Partners, Inc. (the "Adviser") are parties to an
Investment Advisory Agreement dated April 30, 1996, under which the Adviser
receives an annual fee equal to 1.05% of the average daily net assets of the
Target Select Fund. The Adviser has voluntarily agreed to waive all or a portion
of its fees and to reimburse expenses of the Target Select Fund in order to
limit their total operating expenses (as a percentage of average daily net
assets on an annualized basis) to not more than 1.30%. Fee waivers and expense
reimbursements are voluntary and may be terminated at any time.
CoreStates Bank, N.A. acts as custodian (the "Custodian") for the Fund. Fees of
the Custodian are being paid on the basis of the net assets of the Fund. The
Custodian plays no role in determining the investment policies of the Fund or
which securities are to be purchased or sold in the Fund.
12
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Concluded) TIP FUNDS
March 31, 1998 (Unaudited)
6. INVESTMENT TRANSACTIONS:
The cost of security purchases and the proceeds from security sales, other than
short-term investments, for the period ended March 31, 1998 are as follows
(000):
TIP TARGET
SELECT EQUITY FUND
------------------
Purchases
Government ..................... $ --
Other .......................... $2,344
Sales
Government ..................... $ --
Other .......................... $1,719
At March 31, 1998, the total cost of securities and the net realized gains or
losses on securities sold for Federal income tax purposes was not materially
different from amounts reported for financial reporting purposes. The aggregate
gross unrealized appreciation and depreciation for securities held by the Fund
at March 31, 1998, is as follows (000):
TIP TARGET
SELECT EQUITY FUND
------------------
Aggregate gross unrealized appreciation $ 34
Aggregate gross unrealized depreciation (5)
----
Net unrealized appreciation ............. $ 29
====
13
<PAGE>
NOTES
<PAGE>
<PAGE>
TRUST
TIP Funds
P.O. Box 419805
Kansas City, MO 64141-6805
INVESTMENT ADVISOR
Turner Investment Partners, Inc.
SUBADVISORS
Chartwell Investment Partners
Clover Capital Management, Inc.
Penn Capital Management Company, Inc.
DISTRIBUTOR
SEI Investments Distribution Co.
ADMINISTRATOR
SEI Fund Resources
LEGAL COUNSEL
Morgan, Lewis & Bockius LLP
INDEPENDENT AUDITORS
Ernst & Young LLP
[Logo Omitted]
TURNER
INVESTMENT PARTNERS,
INC.
To open an account, receive account information,
make inquiries, or request literature:
1-800-224-6312
THIS REPORT WAS PREPARED FOR SHAREHOLDERS IN THE TIP FUNDS. IT MAY BE
DISTRIBUTED TO OTHERS ONLY IF PRECEDED OR ACCOMPANIED BY A TIP FUNDS PROSPECTUS,
WHICH CONTAINS DETAILED INFORMATION.
TIP-F-006-01
