<PAGE>
First Choice Funds Trust
- -------------------------------------------------------------------------------
Dear First Choice Fund Shareholder:
We are pleased to present our first Semi-Annual Report since our inception as
a mutual fund family on October 1, 1996.
The First Choice U.S. Treasury Reserve Fund and Cash Reserve Fund were created
to meet the quality that you the shareholder have come to expect from the
First Choice Funds. Both funds are managed in a conservative manner. The U.S.
Treasury Reserve Fund is one of a very limited number of mutual funds that
invests exclusively in direct short-term obligations of the United States
Treasury, which are backed by the full faith and credit of the United States
Government. The Cash Reserve Fund will invest only in obligations permitted to
be purchased under Rule 2a-7 of the Investment Company Act of 1940.
In 1996, First American Capital Management Inc., the Fund's Investment
Adviser, was created under the First American Financial Corporation family of
companies as a 1940 Act Registered Investment Advisor. The primary mission of
the company is to provide investment expertise to individual shareholders,
corporations, charities, foundations, community banks and affiliate companies
such as First American Title and First American Trust Company.
At present, the economy appears to be growing at a rate of 2% to 3% a year,
with only modest signs of inflation ranging from 2% to 3%. Short-term interest
rates could continue to be under upward pressure in 1997 because the economy
is doing well and the employment rate is at a recent all time high. The high
employment rate coupled with factories at or near full production could
trigger additional reactions from the Federal Reserve in the months ahead. We
will continue to monitor the role of foreign central banks and their impact on
the U.S. Treasury market.
We will continue to monitor the economy in the months ahead for any changes
that may occur. In the meantime, the current spread between money market funds
and inflation is very wide, and therefore, we believe money markets are an
excellent place for investors seeking safety, liquidity and income.
We appreciate the opportunity to serve your investment needs and urge you to
read the entire report closely to monitor the progress of your investment in
the First Choice Funds.
William C. Conrad
President & CEO
First American Capital Management, Inc.
An investment in the fund is neither insured or guaranteed by the U.S.
Government. Yields will fluctuate, and there can be no assurance that the fund
will be able to maintain a stable NAV of $1.00 per share.
This material must be accompanied or preceded by a prospectus.
- -------------------------------------------------------------------------------
-1-
<PAGE>
TABLE OF CONTENTS
Statement of Assets and Liabilities
Page 3
Statement of Operations
Page 4
Statements of Changes in Net Assets
Page 5
Schedule of Portfolio Investments
Page 6
Notes to Financial Statements
Page 8
Financial Highlights
Page 13
-2-
<PAGE>
FIRST CHOICE FUNDS TRUST
STATEMENTS OF ASSETS AND LIABILITIES
MARCH 31, 1997
(UNAUDITED)
<TABLE>
<CAPTION>
U.S. TREASURY CASH
RESERVE RESERVE
FUND FUND
------------- -----------
<S> <C> <C>
ASSETS:
Investments, at value (Amortized cost $58,029,930,
and $38,043,607, respectively)..................... $58,029,930 $38,043,607
Cash................................................ -- 1,953
Interest receivable................................. 650,825 --
Unamortized organization costs...................... 54,896 61,259
Prepaid expenses.................................... 10,017 16,490
Expense reimbursement receivable.................... 23,141 14,332
----------- -----------
Total Assets.................................... 58,768,809 38,137,641
----------- -----------
LIABILITIES:
Dividends Payable................................... 265,913 172,682
Accrued expenses and other payables:
Investment advisory fees.......................... 2,719 --
Transfer agent fees............................... 6,573 4,128
Legal and audit fees.............................. 18,290 4,843
Custodian and accounting fees..................... 7,177 4,869
Printing costs.................................... 14,902 3,666
Other............................................. 911 234
----------- -----------
Total Liabilities............................... 316,485 190,422
----------- -----------
NET ASSETS:
Capital............................................. 58,451,565 37,947,499
Accumulated undistributed net realized gains
(losses) from investment transactions.............. 759 (280)
----------- -----------
Net Assets...................................... $58,452,324 $37,947,219
=========== ===========
Net Assets
Service Class..................................... 56,926,214 37,946,212
Institutional Class............................... 1,526,110 1,007
----------- -----------
Total........................................... 58,452,324 37,947,219
=========== ===========
Shares of capital stock
Service Class..................................... 56,925,439 37,946,492
Institutional Class............................... 1,526,126 1,007
----------- -----------
Total........................................... 58,451,565 37,947,499
=========== ===========
Net asset value, offering and redemption price per
share
Service Class..................................... $ 1.00 $ 1.00
=========== ===========
Institutional Class............................... $ 1.00 $ 1.00
=========== ===========
</TABLE>
See notes to financial statements.
-3-
<PAGE>
FIRST CHOICE FUNDS TRUST
STATEMENTS OF OPERATIONS
FOR THE PERIOD ENDED MARCH 31, 1997
(UNAUDITED)
<TABLE>
<CAPTION>
U.S. TREASURY CASH
RESERVE RESERVE
FUND* FUND**
------------- --------
<S> <C> <C>
INVESTMENT INCOME:
Interest income........................................ $1,383,518 $458,120
---------- --------
Total Income......................................... 1,383,518 458,120
---------- --------
EXPENSES:
Investment advisory fees............................... 80,074 25,490
Administration fees.................................... 40,037 12,745
Distribution fees--Service class....................... 66,375 21,241
Shareholder Servicing--Service class................... 66,375 21,241
Custodian and accounting fees.......................... 24,567 11,388
Legal and audit fees................................... 23,041 9,594
Organization costs..................................... 8,937 2,574
Trustees' fees and expenses............................ 7,608 1,794
Transfer agent fees.................................... 10,143 4,446
Registration and filing fees........................... 13,061 8,034
Printing costs......................................... 15,152 3,666
Other.................................................. 4,763 2,574
---------- --------
Total expenses....................................... 360,133 124,787
Less: Fee waivers and expense reimbursements........ (268,866) (95,049)
---------- --------
Net Expenses....................................... 91,267 29,738
---------- --------
Net Investment Income.................................. 1,292,251 428,382
---------- --------
REALIZED GAINS (LOSSES) FROM INVESTMENTS:
Net realized gains (losses) from investment
transactions........................................... 759 (280)
---------- --------
Change in net assets resulting from operations......... $1,293,010 $428,102
========== ========
</TABLE>
- --------
*Commencement of operations of the Fund began October 1, 1996.
**Commencement of operations of the Fund began January 13, 1997.
See notes to financial statements.
-4-
<PAGE>
FIRST CHOICE FUNDS TRUST
STATEMENTS OF CHANGES IN NET ASSETS
(UNAUDITED)
<TABLE>
<CAPTION>
U.S. TREASURY CASH
RESERVE RESERVE
FUND FUND
------------- ------------
PERIOD PERIOD
ENDED ENDED
MARCH 31, MARCH 31,
1997* 1997**
------------- ------------
<S> <C> <C>
FROM INVESTMENT ACTIVITIES:
OPERATIONS:
Net investment income............................. $ 1,292,251 $ 428,382
Net realized gains (losses) from investment
transactions....................................... 759 (280)
------------ ------------
Change in net assets resulting from operations..... 1,293,010 428,102
------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS:
From net investment income
Service Class.................................... (1,285,321) (428,371)
Institutional Class.............................. (6,930) (11)
------------ ------------
Change in net assets from shareholder
distributions...................................... (1,292,251) (428,382)
------------ ------------
CAPITAL TRANSACTIONS:
Proceeds from shares issued....................... 135,993,239 72,806,494
Dividends reinvested.............................. 3,015 325
Cost of shares redeemed........................... (77,544,689) (34,859,320)
------------ ------------
Change in net assets from capital transactions..... 58,451,565 37,947,499
------------ ------------
Change in net assets............................... 58,452,324 37,947,219
NET ASSETS:
Beginning of period............................... -- --
------------ ------------
End of period..................................... $ 58,452,324 $ 37,947,219
============ ============
</TABLE>
- --------
*Commencement of operations of the Fund began October 1, 1996.
**Commencement of operations of the Fund began January 13, 1997.
See notes to financial statements.
-5-
<PAGE>
FIRST CHOICE FUNDS TRUST
U.S. TREASURY RESERVE FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
MARCH 31, 1997
(UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL SECURITY
AMOUNT DESCRIPTION VALUE
----------- ----------------------------------------------------- -----------
<C> <S> <C>
U.S. TREASURY BILLS (51.9%):
$ 360,000 5.11%, 4/17/97....................................... $ 359,184
200,000 5.12%, 4/17/97....................................... 199,545
15,100,000 5.15%, 4/17/97....................................... 15,065,403
710,000 5.02%, 5/29/97....................................... 704,258
555,000 5.04%, 5/29/97....................................... 550,493
4,500,000 5.07%, 5/29/97....................................... 4,463,279
465,000 5.14%, 5/29/97....................................... 461,149
800,000 5.19%, 5/29/97....................................... 793,311
5,800,000 5.03%, 7/24/97....................................... 5,707,708
880,000 5.11%, 7/24/97....................................... 865,760
695,000 5.16%, 7/24/97....................................... 683,643
495,000 5.23%, 7/24/97....................................... 486,802
-----------
Total U.S. Treasury Bills 30,340,535
-----------
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL SECURITY
AMOUNT DESCRIPTION VALUE
----------- ----------------------------------------------------- -----------
<C> <S> <C>
U.S. TREASURY NOTES (47.4%):
$ 1,180,000 6.50%, 4/30/97....................................... $ 1,180,903
6,045,000 6.88%, 4/30/97....................................... 6,052,481
10,425,000 6.50%, 5/15/97....................................... 10,439,780
6,200,000 6.13%, 5/31/97....................................... 6,206,698
3,800,000 6.38%, 6/30/97....................................... 3,809,533
-----------
Total U.S. Treasury Notes 27,689,395
-----------
Total (Amortized cost--$58,029,930) (a) $58,029,930
===========
</TABLE>
- --------
Percentages indicated are based on net assets of $58,452,324.
(a) Cost and value for federal income tax and financial reporting purposes are
the same.
See notes to financial statements.
-6-
<PAGE>
FIRST CHOICE FUNDS TRUST
CASH RESERVE FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
MARCH 31, 1997
(UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL SECURITY
AMOUNT DESCRIPTION VALUE
---------- ----------------------------------------------------- -----------
<C> <S> <C>
BANKERS ACCEPTANCES (30.8%):
$2,000,000 Bank of New York
5.30%, 5/5/97....................................... $ 1,989,989
2,300,000 Republic National Bank of New York 5.28%, 5/23/97.... 2,282,459
2,000,000 Bank of America, N.T. & S.A. 5.31%, 6/17/97.......... 1,977,285
1,495,000 Chase Manhattan
5.26%, 4/29/97...................................... 1,488,884
2,000,000 First National Bank of Chicago 5.29%, 7/28/97........ 1,965,321
1,000,000 Union Bank of California
5.28%, 5/20/97...................................... 992,813
1,000,000 Union Bank of California
5.37%, 8/4/97....................................... 981,354
-----------
Total Bankers Acceptances 11,678,105
-----------
COMMERCIAL PAPER (56.7%):
Broker (13.1%):
1,500,000 Bear Stearns & Co.
5.34%, 5/5/97....................................... 1,492,435
2,000,000 Merrill Lynch & Co.
5.42%, 7/14/97...................................... 1,968,685
1,500,000 Smith Barney Inc.
5.29%, 4/3/97....................................... 1,499,559
-----------
4,960,679
-----------
Equipment Rental & Leasing Services (4.4%):
1,700,000 International Lease Finance Corp. 5.24%, 7/28/97..... 1,670,802
-----------
Finance Lessors (10.8%):
2,300,000 General Electric Capital Corp.
5.31%, 4/3/97....................................... 2,299,322
1,800,000 International Business Machine Credit Corp. 5.35%,
4/7/97.............................................. 1,798,395
-----------
4,097,717
-----------
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL SECURITY
AMOUNT DESCRIPTION VALUE
---------- ------------------------------------------------------ -----------
<C> <S> <C>
COMMERCIAL PAPER, CONTINUED:
Personal Credit (17.3%):
$1,500,000 American Express Credit 5.31%, 5/9/97................. $ 1,491,593
1,500,000 American General Finance 5.32%, 4/23/97............... 1,495,123
1,800,000 Ford Motor Credit 5.29% 4/15/97....................... 1,796,297
1,800,000 TransAmerica Finance 5.27%, 4/17/97................... 1,795,784
-----------
6,578,797
-----------
Recreation & Amusement Services (6.1%):
2,300,000 Walt Disney
5.28%, 4/21/97....................................... 2,293,253
-----------
Tobacco (5.0%):
1,900,000 Phillip Morris, Inc.
5.65%, 4/4/97........................................ 1,899,105
-----------
Total Commercial Paper 21,500,353
-----------
U.S. GOVERNMENT AGENCIES (12.8%):
Federal Agricultural Mortgage Corp.:
545,000 5.34%, 4/9/97......................................... 544,353
245,000 5.37%, 4/9/97......................................... 244,708
-----------
789,061
-----------
Federal Home Loan Mortgage Corp.:
1,640,000 5.21%, 4/15/97........................................ 1,636,677
1,295,000 5.49%, 4/15/97........................................ 1,292,235
1,150,000 5.20%, 4/18/97........................................ 1,147,176
-----------
4,076,088
-----------
Total U.S. Government Agency 4,865,149
-----------
Total (Amortized cost--$38,043,607) (a) $38,043,607
===========
</TABLE>
- ------
Percentages indicated are based on net assets of $37,947,219.
(a) Cost and value for federal income tax and financial reporting purposes are
the same.
See notes to financial statements.
-7-
<PAGE>
FIRST CHOICE FUNDS TRUST
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 1997
(UNAUDITED)
1.ORGANIZATION:
The First Choice Funds Trust (the "Trust") is an open-end management
investment company established as a Delaware business trust under a
Declaration of Trust dated June 5, 1996, and is registered under the
Investment Company Act of 1940, as amended (the "1940 Act"). The Trust
currently consists of the U.S. Treasury Reserve Fund and the Cash Reserve
Fund (individually a "Fund", collectively "the Funds"). Between the date of
organization and the date of commencement of operations, the Funds had no
operations.
The investment objective of the U.S. Treasury Reserve Fund is to provide
investors with as high a level of current income as is consistent with
liquidity, maximum safety of principal and the maintenance of a stable $1.00
net asset value per share by investing in U.S. Treasury securities. The
investment objective of the Cash Reserve Fund is to provide investors with
current income, liquidity and the maintenance of a stable $1.00 net asset
value per share by investing in high quality, U.S. dollar-denominated short-
term obligations.
2.SIGNIFICANT ACCOUNTING POLICIES:
The following is a summary of significant accounting policies followed by
the Trust in the preparation of its financial statements. The policies are
in conformity with generally accepted accounting principles. The preparation
of financial statements requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities at
the date of the financial statements and the reported amounts of income and
expenses for the period. Actual results could differ from those estimates.
SECURITIES VALUATION:
Securities are valued utilizing the amortized cost method permitted in
accordance with Rule 2a-7 under the 1940 Act. Under the amortized cost
method, discount or premium is amortized on a constant basis to the
maturity of the security. In addition, the Funds may not (a) purchase any
instrument with a remaining maturity greater than 397 days unless such
instrument is subject to a demand feature, or (b) maintain a dollar-
weighted average maturity which exceeds 90 days.
SECURITIES TRANSACTIONS AND RELATED INCOME:
Security transactions are accounted for on the date the security is
purchased or sold (trade date). Interest income is recognized on the
accrual basis and includes, where applicable, the amortization of premium
or accretion of discount based on the effective interest method. Gains or
losses realized on sales of securities are determined by comparing the
identified cost of the security lot sold with the net sales proceeds.
Continued
-8-
<PAGE>
FIRST CHOICE FUNDS TRUST
NOTES TO FINANCIAL STATEMENTS, CONTINUED
MARCH 31, 1997
(UNAUDITED)
REPURCHASE AGREEMENTS:
The Cash Reserve Fund only, may acquire repurchase agreements from any
bank or broker-dealer which the adviser deems creditworthy under
guidelines approved by the Board of Trustees, subject to the seller's
agreement to repurchase such securities at a mutually agreed-upon date
and price. The repurchase price generally equals the price paid by a Fund
plus interest negotiated on the basis of current short-term rates, which
may be more or less than the rate on the underlying portfolio securities.
The seller, under a repurchase agreement, is required to maintain the
value of collateral held pursuant to the agreement at not less than the
repurchase price (including accrued interest). Securities subject to
repurchase agreements are held by the Fund's custodian or another
qualified custodian or in the Federal Reserve/Treasury book-entry system.
REVERSE REPURCHASE AGREEMENTS:
The Funds may borrow for temporary purposes by entering into reverse
repurchase agreements. Pursuant to such agreements, a Fund would sell
portfolio securities to financial institutions such as banks and
broker/dealers, and agree to repurchase them at a mutually agreed-upon
date and price. At the time a Fund enters into a reverse repurchase
agreement, it places in a segregated custodial account assets having a
value equal to the repurchase price (including accrued interest), and
will continually monitor the account to ensure such equivalent value is
maintained at all times. Reverse repurchase agreements are considered to
be borrowing by the Funds under the 1940 act.
DIVIDENDS TO SHAREHOLDERS:
Dividends from net investment income are declared daily and paid monthly
for the U.S. Treasury Reserve Fund and Cash Reserve Fund, and
distributable net realized capital gains, if any, are declared and
distributed at least annually.
Dividends from net investment income and from net realized capital gains
are determined in accordance with income tax regulations which may differ
from generally accepted accounting principles. These differences are
primarily due to differing treatments of mortgage-backed securities,
expiring capital loss carry-forwards and deferrals of certain losses.
FEDERAL INCOME TAXES:
It is the policy of each Fund to qualify as a regulated investment
company by complying with the provisions available to certain investment
companies, as defined in applicable sections of the Internal Revenue
Code, and to make distributions of net investment income and net realized
capital gains sufficient to relieve it from all, or substantially all,
Federal income taxes.
Continued
-9-
<PAGE>
FIRST CHOICE FUNDS TRUST
NOTES TO FINANCIAL STATEMENTS, CONTINUED
MARCH 31, 1997
(UNAUDITED)
ORGANIZATION COSTS:
Costs incurred by the Trust in connection with its organization and
registration of shares have been deferred and are amortized using the
straight-line method over a period of five years from the commencement of
the public offering of shares of the Funds. In the event that any of the
initial shares of the Funds are redeemed during the amortization period
by any holder thereof, the redemption proceeds will be reduced by any
unamortized organizational expenses of the Trust in the same proportion
as the number of said shares of the Fund being redeemed bears to the
number of initial shares of that Fund that are outstanding at time of
redemption.
OTHER:
Each Fund maintains a cash balance with its custodian and receives a
reduction of their custody fees and expenses for the amounts of interest
earned on such uninvested cash balance. For financial reporting purposes
for the period ended March 31, 1997, custodian fees and expenses were
reduced by $407 for the U.S. Treasury Reserve Fund. There was no effect
on net investment income. The Fund could have invested such cash amounts
in an income producing asset if they had not agreed to a reduction of
fees or expenses under the expense offset arrangement with their
custodian.
3.SHARES OF BENEFICIAL INTEREST
Transactions in Fund Shares were as follows:
<TABLE>
<CAPTION>
U.S. TREASURY CASH
RESERVE FUND RESERVE FUND
PERIOD PERIOD
ENDED ENDED
3/31/97* 3/31/97*
SERVICE SHARES ------------- ------------
<S> <C> <C>
Shares sold...................................... $134,469,144 $ 72,805,494
Shares issued to shareholders in payment of
distributions declared........................... 984 318
Shares Redeemed.................................. (77,544,689) (34,859,320)
------------ ------------
Net Change resulting from Fund share
Transactions..................................... 56,925,439 37,946,492
------------ ------------
</TABLE>
Continued
-10-
<PAGE>
FIRST CHOICE FUNDS TRUST
NOTES TO FINANCIAL STATEMENTS, CONTINUED
MARCH 31, 1997
(UNAUDITED)
<TABLE>
<CAPTION>
U.S. TREASURY CASH
RESERVE FUND RESERVE FUND
PERIOD PERIOD
ENDED 3/31/97* ENDED 3/31/97*
INSTITUTIONAL SHARES -------------- --------------
<S> <C> <C>
Shares sold.................................... $ 1,524,095 $ 1,000
Shares issued to shareholders in payment of
distributions declared......................... 2,031 7
Shares Redeemed................................ -- --
----------- -----------
Net Change resulting from Fund share
Transactions................................... $ 1,526,126 $ 1,007
----------- -----------
Total Increase in Fund Shares.................. 58,451,565 37,947,499
=========== ===========
</TABLE>
--------
* Commencement of operations of the U.S. Treasury Reserve Fund and the Cash
Reserve Fund are October 1, 1996 and January 13, 1997, respectively.
4.RELATED PARTY TRANSACTIONS:
Investment advisory services are provided to the Funds by First American
Capital Management, Inc. Under the terms of the investment advisory
agreement, First American Capital Management, Inc. is entitled to receive
fees, on an annualized basis, of 0.30% of the average daily net assets of
each Fund.
BISYS Fund Services Limited Partnership d/b/a BISYS Fund Services ("BISYS
L.P."), an Ohio limited partnership, and BISYS Fund Services, Inc. ("BISYS")
are subsidiaries of The BISYS Group, Inc.
BISYS L.P. serves the Trust as administrator. Under the terms of the
administration agreement, BISYS L.P. receives fees, on an annualized basis,
of 0.15% that are computed daily as a percentage of the average daily net
assets of each Fund.
BISYS L.P. also serves as Fund distributor. BISYS L.P. receives fees for
providing distribution services under the Distribution Service Plan (the
"Plan") pursuant to Rule 12b-1 of the 1940 Act. Under the Plan, each Fund
pays BISYS L.P. a fee not to exceed, on an annual basis, 0.25% of the
average daily net asset value of each Fund for payments made to banks,
broker/dealers and other institutions, including affiliates of the Adviser,
and for expenses BISYS L.P. and any of its affiliates or subsidiaries incur
for providing distribution or shareholder service assistance.
The Trust may contract with various banks, trust companies, broker-dealers,
or other financial organizations (collectively, the "Service Organizations")
to provide certain administrative services for the Service Class shares of
the Funds, such as maintaining shareholder accounts and records. The Service
Class shares of the Funds may pay fees to Service Organizations in amounts
up to 0.25% of the average daily net assets of the Service Class shares
owned by shareholders serviced by Service Organizations.
Continued
-11-
<PAGE>
FIRST CHOICE FUNDS TRUST
NOTES TO FINANCIAL STATEMENTS, CONTINUED
MARCH 31, 1997
(UNAUDITED)
BISYS serves each Fund as transfer agent and fund accountant. For transfer
agent services, BISYS is entitled to receive fees based upon the number of
shareholders. For fund accounting services, BISYS is entitled to receive
annual fees of $30,000 per fund. In addition, BISYS is reimbursed for
certain out-of-pocket expenses incurred in providing such transfer agency
and fund accounting services. Fees received for transfer agent and fund
accounting services are as follows:
<TABLE>
<CAPTION>
CASH
U.S TREASURY RESERVE
RESERVE FUND FUND
------------ -------
<S> <C> <C>
Transfer Agent........................................... $10,143 $4,446
Fund Accounting.......................................... $17,654 $9,204
</TABLE>
Certain officers of the Trust are affiliated with BISYS and/or First
American Management, Inc. Such officers are not paid any fees directly by
the Funds for serving as officers of the Trust.
Fees may be voluntarily reduced or reimbursed to assist the Funds in
maintaining competitive expense ratios.
Information regarding these transactions are as follows for the period ended
March 31, 1997:
<TABLE>
<CAPTION>
U.S. TREASURY CASH
RESERVE RESERVE
FUND FUND
------------- -------
<S> <C> <C>
INVESTMENT ADVISORY FEES:
Annual fee before voluntary reductions (Percentage of
average net assets)................................... 0.30% 0.30%
Voluntary fee reductions.............................. $72,938 $25,490
ADMINISTRATION FEES:
Annual fee before voluntary reductions (Percentage of
average net assets)................................... 0.15% 0.15%
Voluntary fee reduction............................... $40,037 $12,745
DISTRIBUTION FEES (SERVICE CLASS):
Annual fee before voluntary reductions (Percentage of
average net assets)................................... 0.25% 0.25%
Voluntary fee reductions.............................. $66,375 $21,241
SHAREHOLDER SERVICING FEES (SERVICE CLASS):
Annual fee before voluntary reductions (Percentage of
average net assets)................................... 0.25% 0.25%
Voluntary fee reductions.............................. $66,375 $21,241
EXPENSES ABOVE VOLUNTARY EXPENSE CAP:
Voluntary fee reimbursements.......................... $23,141 $14,332
</TABLE>
-12-
<PAGE>
FIRST CHOICE FUNDS TRUST
FINANCIAL HIGHLIGHTS
(UNAUDITED)
<TABLE>
<CAPTION>
U.S. TREASURY CASH
RESERVE FUND RESERVE FUND
----------------------------- -----------------------------
PERIOD PERIOD
ENDED ENDED
MARCH 31, MARCH 31,
1997 (A) 1997 (B)
----------------------------- -----------------------------
SERVICE INSTITUTIONAL SERVICE INSTITUTIONAL
CLASS CLASS CLASS CLASS
----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
NET ASSET VALUE,
BEGINNING OF PERIOD..... $ 1.000 $ 1.000 $ 1.000 $1.000
----------- ---------- ----------- ------
INVESTMENT ACTIVITIES
Net investment income.. 0.024 0.025 0.011 0.011
Net realized and
unrealized gains
(losses) from
investments........... 0.000 0.000 0.000 0.000
----------- ---------- ----------- ------
Total from Investment
Activities........... 0.024 0.025 0.011 0.011
----------- ---------- ----------- ------
DISTRIBUTIONS
Net investment income.. (0.024) (0.025) (0.011) (0.011)
Net realized gains..... -- -- -- --
----------- ---------- ----------- ------
Total Distributions... (0.024) (0.025) (0.011) (0.011)
----------- ---------- ----------- ------
NET ASSET VALUE, END OF
PERIOD.................. $ 1.000 $ 1.000 $ 1.000 $1.000
=========== ========== =========== ======
Total Return............ 2.43%(c) 2.48%(c) 1.08%(c) 1.10%(c)
RATIOS/SUPPLEMENTARY
DATA:
Net Assets at end of
period................ $56,926,214 $1,526,110 $37,946,212 $1,007
Ratio of expenses to
average net assets.... 0.35%(d) 0.35%(d) 0.35%(d) 0.35%(d)
Ratio of net investment
income to average net
assets................ 4.83%(d) 4.83%(d) 5.04%(d) 5.04%(d)
Ratio of expenses to
average net assets*... 1.34%(d) 0.84%(d) 1.47%(d) 0.97%(d)
Ratio of net investment
income to average net
assets*............... 3.84%(d) 4.34%(d) 3.92%(d) 4.42%(d)
</TABLE>
- --------
* During the period certain expenses were voluntarily reduced. If such
voluntary fee reductions had not occurred, the ratios would have been as
indicated.
(a) Period from commencement of operations, October 1, 1996.
(b) Period from commencement of operations, January 13, 1997.
(c) Not annualized.
(d) Annualized.
See notes to financial statements.
-13-
<PAGE>
INVESTMENT ADVISER
First American Capital Management, Inc.
567 San Nicolas Drive
Suite 101
Newport Beach, California 92660
ADMINISTRATOR AND DISTRIBUTOR
BISYS Fund Services
3435 Stelzer Road
Columbus, Ohio 43219
CUSTODIAN
Investors Fiduciary Trust Company
127 West 10th Street
Kansas City, Missouri 64105
COUNSEL
Baker & McKenzie
805 Third Avenue
New York, New York 10022
INDEPENDENT ACCOUNTANTS
Price Waterhouse LLP
1177 Avenue of the Americas
New York, New York 10036
[LOGO OF FIRST CHOICE FUNDS APPEARS HERE]
U.S. TREASURY RESERVE FUND
CASH RESERVE FUND
SEMI-ANNUAL REPORT
TO
SHAREHOLDERS
MARCH 31, 1997
BISYS FUND SERVICES
3435 STELZER ROAD
COLUMBUS, OHIO 43219
