(THE ROCKLAND GROWTH FUND LOGO)
ANNUAL REPORT
SEPTEMBER 30, 1999
THE ROCKLAND GROWTH FUND
RETAIL CLASS
INSTITUTIONAL CLASS
(THE ROCKLAND GROWTH FUND LOGO)
ANNUAL REPORT
November 19, 1999
Dear Fellow Shareholders,
Thank you all for the continued strong support of the Rockland Growth Fund.
We continue to invest your savings in some of the most dynamic sectors of the
economy such as telecommunications, software, e-commerce, retail and
semiconductors. Our small size allows us to be significantly more nimble than
the much larger funds and we have invested virtually all of our hard earned
money next to your hard earned money, including our entire corporate pension
fund. We believe that this is a rare but necessary condition for sustained
performance.
We would like to take this opportunity to give you our best estimate of the
annual capital gains distribution. We expect the gains to be approximately $6.8
million which translates into approximately $1.10 per share in long-term gains
and $3.90 per share in short term gains. These will be paid out to shareholders
of record December 2, 1999 and payable December 3, 1999. You will see the share
price drop by this amount and reinvested into new shares on December 3 if you
have chosen that option. If you have chosen to reinvest your capital gain
distribution, your dollar investment does not change as a result of this
distribution. Every mutual fund by law must pay out net capital gains taken
from stocks sold during the year.
We wish everyone the very best holiday season!
Sincerely,
/s/ Richard H. Gould /s/ Charles S. Cruice
Richard H. Gould Charles S. Cruice
GREENVILLE CAPITAL MANAGEMENT, INC.
Presents
THE ROCKLAND GROWTH FUND
a Series of
The Rockland Funds Trust
P. O. Box 701
Milwaukee, Wisconsin 53201-0701
1-800-497-3933
Rockland
Growth Fund -- NASDAQ Russell
date Institutional S&P 500 Composite 2000
- ---- ------------- ------- --------- ----
12/2/96 $10,000 $10,000 $10,000 $10,000
3/31/97 $9,004 $10,065 $9,459 $9,731
9/30/97 $14,452 $12,707 $13,084 $12,992
3/31/98 $13,661 $14,896 $14,265 $13,820
9/30/98 $11,532 $13,856 $13,179 $10,521
3/31/99 $16,377 $17,644 $19,221 $11,587
9/30/99 $19,897 $17,710 $21,476 $12,537
Rockland Rockland
Growth Fund -- Growth Fund -- NASDAQ Russell
date Retail Load Retail No Load S&P 500 Composite 2000
- ---- ----------- -------------- ------- --------- ----
12/2/96 $10,000 $10,000 $10,000 $10,000 $10,000
3/31/97 $8,711 $8,980 $10,065 $9,459 $9,731
9/30/97 $13,987 $14,420 $12,707 $13,084 $12,992
3/31/98 $13,200 $13,609 $14,896 $14,265 $13,820
9/30/98 $11,129 $11,473 $13,856 $13,179 $10,521
3/31/99 $15,792 $16,281 $17,644 $19,221 $11,587
9/30/99 $19,181 $19,775 $17,710 $21,476 $12,537
FOR THE PERIOD ENDED SEPTEMBER 30, 1999
ANNUALIZED SINCE
ONE YEAR COMMENCEMENT OF OPERATIONS
-------- --------------------------
Rockland Growth Fund -- Institutional 72.52% 27.52%
Rockland Growth Fund -- Retail No Load 72.34% 27.23%
Rockland Growth Fund -- Retail Load 67.10% 25.87%
S&P 500 27.80% 22.38%
NASDAQ Composite 62.66% 31.01%
Russell 2000 19.16% 8.32%
The Standard & Poor's 500 Index (S&P 500) is a capital-weighted index,
representing the aggregate market value of the common equity of 500 stocks
primarily traded on the New York Stock Exchange. The NASDAQ Composite Index is
a broad-based capitalization-weighted index of all NASDAQ stocks. The Russell
2000 is an unmanaged index of 2,000 stocks weighted by market capitalization.
This chart assumes an initial gross investment of $10,000 made on 12/2/96
(commencement of operations). Returns shown include the reinvestment of all
dividends. Past performance is not predictive of future performance.
Investment return and principal value will fluctuate, so that your shares, when
redeemed, may be worth more or less than the original cost.
ROCKLAND GROWTH FUND
INDEPENDENT AUDITOR'S REPORT
The Shareholders and Board of Trustees
The Rockland Growth Fund:
We have audited the accompanying statement of assets and liabilities of
Rockland Growth Fund (the "Fund"), including the schedule of investments, as of
September 30, 1999, and the related statement 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 and the financial highlights for each of the periods
presented. These financial statements and financial highlights are the
responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatements. An audit includes examining, on
a test basis, evidence supporting the amounts and disclosures in the financial
statements and financial highlights. Our procedures included confirmation of
securities owned as of September 30, 1999, by correspondence with the custodian
and brokers. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of the
Fund as of September 30, 1999 and the results of operations for the year then
ended, the changes in its net assets for each of the years in the two year
period then ended, and the financial highlights for each of the periods
presented, in conformity with generally accepted accounting principles.
/s/ KPMG LLP
Chicago, Illinois
October 22, 1999
ROCKLAND GROWTH FUND
STATEMENT OF ASSETS AND LIABILITIES -- SEPTEMBER 30, 1999
ASSETS:
Investments, at value (cost $21,162,401) $24,855,487
Receivable for investments sold 1,680,150
Dividends and interest receivable 8,376
Organizational expenses, net of accumulated amortization 14,584
Cash 2,100
Other assets 19,672
-----------
Total Assets 26,580,369
-----------
LIABILITIES:
Payable for investments purchased 2,573,956
Payable to Adviser 17,257
Accrued expenses and other liabilities 63,950
-----------
Total Liabilities 2,655,163
-----------
NET ASSETS $23,925,206
-----------
-----------
NET ASSETS CONSIST OF:
Capital stock $14,525,879
Accumulated undistributed net realized gain on investments sold 5,706,241
Net unrealized appreciation on investments 3,693,086
-----------
Total Net Assets $23,925,206
-----------
-----------
RETAIL CLASS:
Net Assets $ 2,363,867
Shares of beneficial interest outstanding (unlimited shares
of $.001 par value authorized) 122,811
Net asset value and redemption price per share $ 19.25
-----------
-----------
Maximum offering price per share $ 19.85
-----------
-----------
INSTITUTIONAL CLASS:
Net Assets $21,561,339
Shares of beneficial interest outstanding (unlimited shares
of $.001 par value authorized) 1,115,120
Net asset value, redemption price and offering price per share $ 19.34
-----------
-----------
See notes to the financial statements.
ROCKLAND GROWTH FUND
STATEMENT OF OPERATIONS -- YEAR ENDED SEPTEMBER 30, 1999
INVESTMENT INCOME:
Dividend income $ 13,906
Interest income 57,463
----------
Total investment income 71,369
----------
EXPENSES:
Investment advisory fee 174,114
Administration fee 50,005
Shareholder servicing and accounting costs 72,816
Custody fees 34,567
Federal and state registration 13,146
Professional fees 27,097
Reports to shareholders 7,113
Trustees' fees and expenses 3,608
Amortization of organizational expenses 6,935
Distribution expenses -- Retail Class 4,474
Other 12,099
----------
Total operating expenses before reimbursement 405,974
Less: Reimbursement from Adviser (96,798)
----------
Total expenses 309,176
----------
NET INVESTMENT LOSS (237,807)
----------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) on:
Investments 6,678,104
Short positions (85,807)
Net change in unrealized appreciation/depreciation on:
Investments 2,832,339
Short positions 1,403
----------
Net realized and unrealized gain on investments 9,426,039
----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $9,188,232
----------
----------
See notes to the financial statements.
ROCKLAND GROWTH FUND
STATEMENTS OF CHANGES IN NET ASSETS
YEAR ENDED YEAR ENDED
SEPTEMBER 30, 1999 SEPTEMBER 30, 1998
------------------ ------------------
OPERATIONS:
Net investment loss $ (237,807) $ (184,078)
Net realized gain (loss) on:
Investments 6,678,104 (395,128)
Short positions (85,807) 79,004
Net change in unrealized appreciation/
depreciation on:
Investments 2,832,339 (2,270,961)
Short positions 1,403 (1,403)
----------- -----------
Net increase (decrease) in net assets
resulting from operations 9,188,232 (2,772,566)
----------- -----------
CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold 3,621,330 3,339,381
Shares issued to holders in
reinvestment of dividends -- 270,117
Cost of shares redeemed (703,078) (517,134)
----------- -----------
Net increase in net assets resulting
from capital share transactions 2,918,252 3,092,364
----------- -----------
DISTRIBUTIONS TO RETAIL CLASS
SHAREHOLDERS:
In excess of net realized gains -- (14,424)
Return of capital -- (11,862)
----------- -----------
-- (26,286)
DISTRIBUTIONS TO INSTITUTIONAL CLASS
SHAREHOLDERS:
In excess of net realized gains -- (140,328)
Return of capital -- (115,410)
----------- -----------
-- (255,738)
NET INCREASE IN NET ASSETS 12,106,484 37,774
NET ASSETS:
Beginning of period 11,818,722 11,780,948
----------- -----------
End of period $23,925,206 $11,818,722
----------- -----------
----------- -----------
See notes to the financial statements.
ROCKLAND GROWTH FUND
FINANCIAL HIGHLIGHTS
<TABLE>
DECEMBER 2, 1996 (1)<F1>
YEAR ENDED YEAR ENDED THROUGH
SEPTEMBER 30, 1999 SEPTEMBER 30, 1998 SEPTEMBER 30, 1997
-------------------------- ------------------------- ------------------------
RETAIL INSTITUTIONAL RETAIL INSTITUTIONAL RETAIL INSTITUTIONAL
CLASS CLASS CLASS CLASS CLASS CLASS
----- ------------- ----- ------------- ----- -------------
<S> <C> <C> <C> <C> <C> <C>
Per Share Data:
Net asset value,
beginning of period $ 11.17 $ 11.21 $ 14.42 $ 14.43 $ 10.00 $ 10.00
------- ------- ------- ------- ------- -------
Income from
investment operations:
Net investment loss (0.25)(8)<F8> (0.20)(8)<F8> (0.20)(7)<F7> (0.17)(7)<F7> (0.15)(8)<F8> (0.11)(8)<F8>
Net realized and unrealized
gains (losses) on investments 8.33 8.33 (2.73) (2.73) 4.57 4.56
------- ------- ------- ------- ------- -------
Total from investment
operations 8.08 8.13 (2.93) (2.90) 4.42 4.45
------- ------- ------- ------- ------- -------
Less distributions:
Dividends in excess of net
investment income -- -- -- -- -- (0.02)
Distributions in excess of
net realized gains -- -- (0.18) (0.18) -- --
Return of capital -- -- (0.14) (0.14) -- --
------- ------- ------- ------- ------- -------
Total distributions -- -- (0.32) (0.32) -- (0.02)
------- ------- ------- ------- ------- -------
Net asset value, end of period $ 19.25 $ 19.34 $ 11.17 $ 11.21 $ 14.42 $ 14.43
------- ------- ------- ------- ------- -------
------- ------- ------- ------- ------- -------
Total return (2)<F2> (3)<F3> 72.34% 72.52% (20.44%) (20.21%) 44.20% 44.53%
Supplemental data and ratios:
Net assets, end of period $2,363,867 $21,561,339 $1,137,385 $10,681,337 $921,991 $10,858,957
Ratio of operating
expenses to average
net assets (4)<F4> (5)<F5> 2.00% 1.75% 2.00% 1.75% 2.00% 1.75%
Ratio of net investment loss to
average net assets (4)<F4> (5)<F5> (1.59%) (1.34%) 1.72% (1.47%) 1.36% 1.11%
Portfolio turnover rate (6)<F6> 814.67% 814.67% 353.27% 353.27% 204.05% 204.05%
</TABLE>
(1)<F1> Commencement of operations.
(2)<F2> Not annualized for the period December 2, 1996 through September 30,
1997.
(3)<F3> The total return does not reflect the 3% front-end sales charge for
the Retail Class.
(4)<F4> Annualized for the period December 2, 1996 through September 30, 1997.
(5)<F5> Without expense reimbursements of $96,798, $107,092 and $120,419 for
the years ended September 30, 1999, 1998 and the period December 2,
1996 through September 30, 1997, respectively, the ratio of operating
expenses to average net assets would have been 2.56%, 2.85% and 4.23%
for the for the Retail class and 2.31%, 2.60% and 3.98% for the
Institutional class, respectively. The ratio of net investment loss
to average net assets would have been (2.15)%, (2.57)% and (3.60)% for
the Retail class and (1.90)%, (2.32)% and (3.35)% for the
Institutional class, respectively.
(6)<F6> Portfolio turnover is calculated on the basis of the Fund as a whole
without distinguishing between the classes of shares issued.
(7)<F7> Net investment loss per share is calculated using ending balances
prior to consideration of adjustments for permanent book and tax
differences.
(8)<F8> Net investment loss per share represents net investment loss divided
by the monthly average shares of beneficial interest outstanding
throughout the period.
See notes to the financial statements.
ROCKLAND GROWTH FUND
SCHEDULE OF INVESTMENTS -- SEPTEMBER 30, 1999
SHARES VALUE
- ------ -----
COMMON STOCKS -- 88.0%
BUILDING & CONSTRUCTION -- 3.1%
28,000 Insituform Technologies, Inc. -- Class A *<F9> $ 700,000
1,000 NVR, Inc.*<F9> 50,500
-----------
750,500
-----------
BUSINESS SERVICES -- 7.5%
3,000 The Corporate Executive Board Company *<F9> 122,250
8,000 Dendrite International, Inc. *<F9> 378,000
8,000 Diamond Technology Partners Incorporated *<F9> 359,000
10,000 Heidrick & Struggles International, Inc. *<F9> 190,625
11,000 International Network Services *<F9> 598,125
3,000 Lamar Advertising Company *<F9> 148,500
-----------
1,796,500
-----------
COMMUNICATIONS & MEDIA -- 1.5%
15,000 Saga Communications, Inc. -- Class A *<F9> 345,000
-----------
COMPUTERS -- 9.6%
18,000 Cybex Computer Products Corporation *<F9> 600,750
5,000 Dataram Corporation *<F9> 53,750
4,000 Insight Enterprises, Inc. *<F9> 130,000
12,000 MICROS Systems, Inc. *<F9> 486,000
20,000 M-Systems Flash Disk Pioneers Ltd. *<F9> 213,750
15,000 MTI Technology Corporation *<F9> 345,938
6,000 VERITAS Software Corporation *<F9> 455,625
-----------
2,285,813
-----------
CONSUMER PRODUCTS -- 0.9%
6,000 JAKKS Pacifics, Inc. *<F9> 225,000
-----------
DISTRIBUTION -- 1.9%
16,000 ScanSource, Inc. *<F9> 446,000
-----------
EDUCATION -- 0.6%
8,000 Corinthian Colleges, Inc. *<F9> 151,000
-----------
ELECTRONICS -- 2.3%
4,000 Jabil Circuit, Inc. *<F9> 198,000
4,000 Orbotech Ltd. 247,500
4,000 Zoran Corporation *<F9> 108,500
-----------
554,000
-----------
ELECTRICAL EQUIPMENT -- 5.2%
7,000 Photon Dynamics, Inc. *<F9> 147,000
20,000 Excel Technology, Inc. *<F9> 298,750
17,000 Helix Technology Corporation 565,250
10,000 Loronix Information Systems, Inc. *<F9> 115,000
3,000 PRI Automation, Inc. *<F9> 108,375
-----------
1,234,375
-----------
ENTERTAINMENT & LEISURE -- 0.7%
4,000 Speedway Motorsports, Inc. *<F9> 173,250
-----------
FOOD, BEVERAGES & TOBACCO -- 1.0%
10,000 The Hain Food Group, Inc. *<F9> 247,500
-----------
HEALTH CARE SERVICES -- 0.5%
4,000 Accredo Health, Incorporated *<F9> 126,000
-----------
INTERNET -- 5.0%
2,000 Exodus Communications, Inc. *<F9> 144,125
7,000 iXL Enterprises, Inc. *<F9> 248,063
4,000 Netopia, Inc. *<F9> 159,500
4,000 Ramp Networks, Inc. *<F9> 88,000
2,000 RealNetworks, Inc. *<F9> 209,125
8,000 Unify Corporation *<F9> 180,000
5,000 USinternetworking, Inc. *<F9> 156,250
-----------
1,185,063
-----------
LODGING -- 1.1%
15,000 U.S. Franchise Systems, Inc. *<F9> 259,687
-----------
MACHINERY - INDUSTRIAL -- 1.5%
11,000 Asyst Technologies, Inc. *<F9> 363,000
-----------
MEDICAL PRODUCTS -- 2.9%
6,000 ArthroCare Corporation *<F9> 327,750
7,000 Cytyc Corporation *<F9> 270,813
3,000 Enzon, Inc. *<F9> 91,500
-----------
690,063
-----------
OIL & GAS SERVICES -- 0.8%
5,000 Enterprise Products Partners L.P. 99,063
5,000 Midcoast Energy Resources, Inc. 98,750
-----------
197,813
-----------
PLASTICS -- 1.3%
25,000 U.S. Plastic Lumber Corporation *<F9> 309,375
-----------
RETAIL -- 4.5%
12,000 Cost Plus, Inc. *<F9> 582,000
13,000 1-800 CONTACTS, INC. *<F9> 370,500
5,000 Electronics Boutique Holdings Corp. *<F9> 128,750
-----------
1,081,250
-----------
SEMICONDUCTORS -- 11.0%
15,000 ASE Test Limited *<F9> 363,750
12,000 Amkor Technology, Inc. *<F9> 193,500
3,000 Applied Micro Circuits Corporation *<F9> 171,000
10,000 Dallas Semiconductor Corporation 534,375
6,000 LAM Research Corporation *<F9> 366,000
10,000 TranSwitch Corporation *<F9> 570,000
5,000 Vitesse Semiconductor Corporation *<F9> 426,875
-----------
2,625,500
-----------
SOFTWARE -- 13.7%
3,000 Check Point Software Technologies Ltd. *<F9> 253,312
10,000 Concord Communications, Inc. *<F9> 397,500
4,000 Genesys Telecommunications Laboratories, Inc. *<F9> 182,750
15,000 ION Networks, Inc. *<F9> 96,562
6,000 ISS Group, Inc. *<F9> 163,500
11,000 Mercury Interactive Corporation *<F9> 710,188
12,000 MicroStrategy Incorporated *<F9> 672,750
15,000 Optimal Robotics Corp. *<F9> 270,000
3,000 Pervasive Software Inc. *<F9> 103,500
13,000 Rimage Corporation *<F9> 220,187
3,000 Verity, Inc. *<F9> 206,438
-----------
3,276,687
-----------
TELECOMMUNICATIONS -- 9.6%
15,000 Gentner Communications Corporation *<F9> 120,000
2,000 Harmonic Inc. *<F9> 261,625
24,000 Hyperion Telecommunications, Inc. -- Class A *<F9> 595,500
8,000 Leap Wireless International, Inc. *<F9> 188,000
6,000 NorthEast Optic Network, Inc. *<F9> 226,500
4,000 Orckit Communications Ltd. *<F9> 141,500
9,000 Price Communications Corporation *<F9> 225,562
12,000 Western Wireless Corporation -- Class A *<F9> 538,125
-----------
2,296,812
-----------
TEXTILES & APPAREL -- 0.2%
2,000 WestPoint Stevens Inc. *<F9> 47,250
-----------
TRANSPORTATION -- 1.6%
12,000 Expeditors International of Washington, Inc. 385,125
-----------
TOTAL COMMON STOCKS (Cost $17,359,477) 21,052,563
-----------
PRINCIPAL
AMOUNT
---------
SHORT-TERM INVESTMENTS -- 15.9%
VARIABLE RATE DEMAND NOTES#<F10> -- 15.9%
$ 353,169 American Family Financial Services Inc., 5.0234% 353,169
1,125,224 Firstar Bank, 5.13% 1,125,224
1,000,800 General Mills, Inc., 4.985% 1,000,800
978,008 Pitney Bowes, Inc., 4.985% 978,008
42,007 Wisconsin Corp Century Credit Union, 5.05% 42,007
303,716 Wisconsin Electric Power Company, 5.0234% 303,716
-----------
TOTAL SHORT-TERM INVESTMENTS (Cost $3,802,924) 3,802,924
-----------
TOTAL INVESTMENTS - (COST OF $21,162,401) - 103.9% 24,855,487
Liabilities, less Other Assets - (3.9%) (930,281)
-----------
TOTAL NET ASSETS -- 100.0% $23,925,206
-----------
-----------
*<F9> Non-income producing security.
#<F10> Variable rate demand notes are considered short-term obligations and
are payable on demand.
Interest rates change periodically on specified dates. The rates
listed are as of September 30, 1999.
See notes to the financial statements.
ROCKLAND GROWTH FUND
NOTES TO THE FINANCIAL STATEMENTS -- SEPTEMBER 30, 1999
1. ORGANIZATION AND SIGNIFICANT
ACCOUNTING POLICIES
The Rockland Funds Trust (the "Trust") was organized on July 31, 1996, as a
Delaware business trust and is registered as an open-end management
investment company under the Investment Company Act of 1940 ("1940 Act").
The Trust currently consists of one series, The Rockland Growth Fund (the
"Fund"). The investment objective of the Fund is to seek capital
appreciation. In seeking its investment objective of capital appreciation,
the Fund will, under normal market conditions, invest primarily in equity
securities of domestic companies. The Fund is structured for flexibility and
risk reduction, but centered around investment in high quality growth stocks
with an emphasis on those companies whose growth potential, in the opinion
of the Fund's investment adviser, GREENVILLE CAPITAL MANAGEMENT, INC., has
been overlooked by Wall Street analysts. The Fund issued and sold 10,000
Institutional shares of its capital stock at $10 per share on October 21,
1996. The Fund commenced operations on December 2, 1996.
The costs incurred in connection with the organization, initial registration
and public offering of shares, aggregating $34,078, have been paid by the
Adviser. The Fund has reimbursed the Adviser. These costs are being
amortized over the period of benefit, but not to exceed sixty months from
the Fund's commencement of operations.
The Fund has issued two classes of shares: Retail and Institutional. The
Retail shares are subject to a 0.25% 12b-1 fee and an initial sales charge
imposed at the time of purchase, in accordance with the Fund's prospectus.
The maximum sales charge is 3% of the offering price or 3.09% of the net
asset value. Each class of shares has identical rights and privileges except
with respect to 12b-1 fees paid by Retail shares and voting rights on
matters affecting a single class of shares.
The following is a summary of significant accounting policies consistently
followed by the Fund.
a) Investment Valuation - Common stocks, other equity-type securities, and
securities sold short that are listed on a security exchange or quoted
on NASDAQ are valued at the last quoted sales price on which such
securities are primarily traded. Common stocks, other equity-type
securities, and securities sold short which are listed on an exchange
or the NASDAQ Stock Market but which are not traded on the valuation
date are valued at the mean between the current bid and asked price.
Options purchased or written by the Fund are valued at the average of
the current bid and asked prices. Mutual fund investments are valued at
the net asset value on the day the valuation is made. Other assets and
securities for which no quotations are readily available are valued at
fair value as determined in good faith by management in accordance with
procedures approved by the Board of Trustees. Debt securities (those
with remaining maturities of 60 days or less) are valued at amortized
cost, which approximates market value.
b) Federal Income Taxes - It is the Fund's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated
investment companies and to distribute all of its taxable net income as
well as any net realized gains to its shareholders. Therefore, no
federal income tax provision is required.
c) Distributions to Shareholders - Dividends from net investment income
are generally declared and paid annually in December. Distributions of
net realized capital gains, if any, will be declared at least annually
and are generally distributed in December. Distributions from net
realized gains for book purposes may include short-term capital gains
which are included as ordinary income to shareholders for tax purposes.
Generally accepted accounting principles require that permanent
differences between financial reporting and tax reporting be
reclassified between various components of net assets. On the statement
of assets and liabilities, as a result of permanent book-to-tax
differences, $3,421 has been reclassified from capital with $237,807
posted to accumulated undistributed net investment income and $234,386
posted from accumulated net realized gain. These differences relate to
the use of the net operating loss as an offset against short-term gains
for tax purposes and the amortization of organization costs for tax
purposes.
Net investment income and realized gains and losses for federal income
tax purposes may differ from that reported on the financial statements
because of temporary book and tax basis differences. Temporary
differences are primarily the result of losses from wash sales.
On December 31, 1996, a dividend of $3,001 was paid to Institutional
shareholders of record on December 30, 1996. There were no Retail
shareholders as of the record date.
d) 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 revenues and expenses during the reporting period.
Actual results could differ from those estimates.
e) Foreign Securities - Investing in securities of foreign companies and
foreign governments involves special risks and considerations not
typically associated with investing in U.S. companies and the U.S.
government. These risks include revaluation of currencies and future
adverse political and economic developments. Moreover, securities of
many foreign companies and foreign governments and their markets may be
less liquid and their prices more volatile than those of securities of
comparable U.S. companies and the U.S. government.
f) Other - Investment and shareholder transactions are recorded on trade
date. The Fund determines the gain or loss realized from investment
transactions by comparing the original cost of the security lot sold
with the net sales proceeds. Dividend income is recognized on the ex-
dividend date or as soon as information is available to the Fund, and
interest income is recognized on an accrual basis.
2. SHARES OF BENEFICIAL INTEREST
Transactions in shares of beneficial interest for the year ending September
30, 1999 were as follows:
$ SHARES
--- ------
RETAIL SHARES:
Shares sold $ 374,344 25,883
Shares issued to holders in
reinvestment of dividends -- --
Shares redeemed (75,163) (4,919)
---------- ---------
Net increase $ 299,181 20,964
----------
----------
SHARES OUTSTANDING:
Beginning of period 101,847
---------
End of period 122,811
---------
---------
INSTITUTIONAL SHARES:
Shares sold $3,246,986 202,773
Shares issued to holders in
reinvestment of dividends -- --
Shares redeemed (627,915) (40,817)
---------- ---------
Net increase 2,619,071 161,956
----------
----------
SHARES OUTSTANDING:
Beginning of period 953,164
---------
End of period 1,115,120
---------
---------
TOTAL NET INCREASE $2,918,252
----------
----------
3. INVESTMENT TRANSACTIONS
The aggregate purchases and sales of investments, excluding short-term
investments and short positions, by the Fund for the year ended September
30, 1999, were $132,528,670 and $131,151,238, respectively.
At September 30, 1999, gross unrealized appreciation and depreciation of
investments for tax purposes were as follows:
Appreciation $3,935,420
(Depreciation) (634,448)
----------
Net appreciation on investments $3,300,972
----------
----------
At September 30, 1999, the cost of investments for federal income tax
purposes was $21,554,515.
4. INVESTMENT ADVISORY AND OTHER
AGREEMENTS
The Trust, on behalf of the Fund, has entered into an Investment Advisory
Agreement with Greenville Capital Management, Inc. Pursuant to its advisory
agreement with the Trust, the Investment Adviser is entitled to receive a
fee, calculated daily and payable monthly, at the annual rate of 1.00% as
applied to the Fund's daily net assets.
The Investment Adviser has voluntarily agreed to waive its management fee
and/or reimburse the operating expenses to the extent necessary to insure
that the total operating expenses do not exceed 2.00% and 1.75% of the
Fund's average daily net assets for the Retail class and Institutional
class, respectively.
Firstar Mutual Fund Services, LLC serves as transfer agent, administrator
and accounting services agent for the Fund. Firstar Bank Milwaukee, N.A.
serves as custodian for the Fund.
5. SHORT POSITIONS
As a portfolio management strategy, the Fund may engage in short sales of
securities, which result in obligations of the Fund to make a future
delivery of a specific security. These obligations are subject to the risk
that the security's market price at the delivery date will exceed the
amount of proceeds initially received, and that the Fund may be required to
purchase the security at prevailing market prices (or deliver the security
if owned by the Fund) and thus realize a loss on the transaction.
Obligations under short sales are reported as liabilities and are adjusted
to the current market value of the security to be delivered. The Fund
generally maintains deposits with brokers approximating the market value of
securities sold short. At September 30, 1999, the Fund had no short
positions.
6. DISTRIBUTION PLAN
The Fund has adopted a plan pursuant to Rule 12b-1 under the 1940 Act (the
"Plan"), which requires the Retail class to pay the Distributor a
distribution fee of up to 0.25% of its average daily net assets computed on
an annual basis. Under the terms of the Plan, the Distributor is authorized
to, in turn, pay all or a portion of this fee to any securities dealer,
financial institution or any other person who renders assistance in
distributing or promoting the sale of Retail class shares pursuant to a
written agreement. To the extent such fee is not paid to such persons, the
Distributor may use the fee for its own distribution expenses incurred in
connection with the sale of the shares, although it is the Distributor's
current intention to pay out all or most of the fee. The Fund has incurred
$4,474 pursuant to the Plan for the year ended September 30, 1999.
TRUSTEES
Mr. Charles Cruice
Mr. Richard Gould
Mr. Robert Harrison
Mr. Edwin Moats, Jr.
Dr. Peter Utsinger
Mr. Richard Vague
OFFICERS
Mr. Charles Cruice, President
Mr. Richard Gould, Treasurer
Mr. Jeffrey Rugen, Secretary
INVESTMENT ADVISOR
Greenville Capital Management, Inc.
100 South Rockland Falls Road
Rockland, DE 19732
CUSTODIAN
Firstar Bank Milwaukee, N.A.
P.O. Box 701
777 East Wisconsin Avenue
Milwaukee, WI 53202
ADMINISTRATOR, TRANSFER AGENT
AND DIVIDEND-DISBURSING AGENT
Firstar Mutual Fund Services, LLC
P.O. Box 701
Third Floor
615 East Michigan Street
Milwaukee, WI 53202
INDEPENDENT ACCOUNTANTS
KPMG LLP
303 East Wacker Drive
Chicago, IL 60601
LEGAL COUNSEL
Morgan, Lewis & Bockius LLP
1701 Market Street
Philadelphia, PA 19103
