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Annual Report
October 31, 1999
GRAND PRIX FUND
November 1999
Dear Fellow Shareholder,
Grand Prix Fund provided a total return of 131.5% for Class A shares compared to
25.7% for the S&P 500 for the fiscal year ended October 31, 1999. Since
inception, the Fund's return for Class A shares is 233.8% versus 44.0% for the
S&P 500. The Fund ranked among the top 3 growth funds among 980 growth funds for
12 months ending September 30, 1999 according to Lipper.
The stock market has been dominated by large cap stocks for the nearly two years
that Grand Prix Fund has been in existence. Our research indicates that market
cap has a significant influence on stock price behavior. We try to "model" the
portfolio with those market caps that are leading the stock market based on our
selection criteria. Accordingly, about 80% of the Fund was constructed with
large and mid cap stocks at fiscal year end.
The "flex-cap" nature of the Fund provides this important advantage.
As you read through this report, you will find that the Fund held 25 stocks
compared to about 135 for the typical stock fund at fiscal year end. This
so-called "focus" fund approach put more money into the best stocks. No big bets
are made in any particular issue as purchases for each position are kept to
similar dollar amounts. Our reason for even-weighting position is simple; no
investor ever really knows beforehand which stocks will go up or down in any
portfolio.
The Fund employs a "quantitative" approach to stock selection using an earnings
and price momentum strategy. It has become increasingly difficult to forecast
stock prices using the traditional P/E approach due to a seemingly overvalued
stock market in which many stocks trade at unprecedented high P/E's. For
example, JDS Uniphase was purchased in the Fund in early 1999 at a then P/E of
81X . It never traded above a P/E of 10 in 1997. Based on historical P/E's, it
was impossible to forecast the stock soaring to a 300 P/E where it now trades.
Our quantitative approach seeks to select the best stocks without regard to
sector or industry. As a result, the Fund frequently will have sizable sector or
industry weightings. As of October 31, 1999, the Fund was invested in 7
industries compared to 107 industries which comprise the S&P 500 Index. Software
industry holdings represented 24.9% of assets versus 7.0% for the S&P 500. It
should be kept in mind that a Fund can not dramatically outperform the S&P 500
if it has the same industry make-up and weighting as the S&P 500.
Heading into a Presidential election year, we view Y2K prospects as being
favorable for the stock market. The stock market has not declined in a
Presidential election year since John F. Kennedy was elected in 1960. The 13th
bull market since World War II is just beginning its second year and bull
markets typically last 3-4 years. The economic backdrop is encouraging with an
expanding economy and rising profits. We estimate profits for the stock held in
the Fund to rise on average 65% in 2000 and well in excess of expected corporate
profits growth of only 10%. We feel the Fund is well-positioned at this time.
We feel comfortable with the economy and the stock market entering the new
fiscal year, but stand ready to make changes in the Fund in response to
ever-changing economic and stock market developments in the year ahead.
Sincerely,
Robert Zuccaro, CFA
President
Graph
01/01/98 10/31/98 10/31/99
-------- -------- --------
Grand Prix Fund - Class A Shares (NAV) $10,000 $14,419 $33,382
Grand Prix Fund - Class A Shares (Load) $10,000 $13,667 $31,641
S&P 500 Index $10,000 $11,463 $14,405
08/05/99 10/31/99
-------- --------
Grand Prix Fund - Class C Shares (NAV) $10,000 $13,708
Grand Prix Fund - Class C Shares (Load) $10,000 $13,571
S&P 500 Index $10,000 $10,473
TOTAL RETURN
For the period ended October 31, 1999
Annualized
One Year Since Inception
-------- ----------------
Grand Prix Fund - Class A Shares (NAV) 131.51% 93.04%
Grand Prix Fund - Class A Shares (Load) 119.34% 87.48%
S&P 500 Index 25.67% 22.03%
08/05/99 (1)
through 10/31/99
----------------
Grand Prix Fund - Class C Shares (NAV) 37.08%
Grand Prix Fund - Class C Shares (Load) 35.72%
S&P 500 Index 4.73%
(1) commencement of operations.
These charts assume an initial gross investment of $10,000 made on 12/31/97 and
8/05/99 (since inception) for the Class A Shares and Class C Shares,
respectively, and the Standard & Poor's 500 Index (S&P 500) on each date. The
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.
Returns include the reinvestment of all dividends and capital gains. Past
performance is not predictive of future performance. Absent expense
reimbursements and fee waivers, total returns would be reduced. Investment
return and principal value will fluctuate, so that your shares, when redeemed,
may be worth more or less than the original cost.
The S&P 500 Stock Index is an unmanaged index of 500 selected common stocks,
most of which are listed on the New York Stock Exchange. The Index is heavily
weighted toward stocks with large market capitalizations and represents
approximately two-thirds of the total market value of all domestic common
stocks.
Grand Prix fund
STATEMENT OF ASSETS AND LIABILITIES - OCTOBER 31, 1999
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
ASSETS:
<S> <C>
Investments, at value(cost $ 83,806,457) $ 110,451,309
Cash 2,327,349
Receivable for investments sold 2,646,687
Capital shares sold 5,175,249
Dividends and interest receivable 28,979
Organizational expenses, net of accumulated amortization 50,396
Other assets 18,938
-----------------
Total Assets 120,698,907
-----------------
LIABILITIES:
Loan Payable 10,000,000
Payable for sercurities purchased 7,992,106
Capital shares redeemed 282,630
Payable to Advisor 64,152
Accrued expenses and other liabilities 130,357
-----------------
Total Liabilities 18,469,245
-----------------
NET ASSETS $ 102,229,662
=================
NET ASSETS CONSIST OF:
Capital stock $ 75,907,111
Accumulated undistributed net realized loss on investments sold (322,301)
Net unrealized appreciation on investments 26,644,852
-----------------
Total Net Assets $ 102,229,662
=================
CLASS A SHARES:
Net assets $ 92,499,551
Shares of beneficial interest outstanding (500,000,000 shares of
$.01 par value authorized ) 3,279,366
Net asset value and redemption price per share $28.21
=================
Maximum offering price per share (100/94.75 of $28.21) $29.77
=================
CLASS C SHARES:
Net assets $ 9,730,111
Shares of beneficial interest outstanding (500,000,000 shares of
$.01 par value authorized ) 345,439
Net asset value and redemption price per share $ 28.17
=================
Maximum offering price per share (100/99 of $28.17) $ 28.45
=================
</TABLE>
See notes to the financial statements.
Grand Prix Fund
STATEMENT OF OPERATIONS - YEAR ENDED OCTOBER 31, 1999
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INVESTMENT INCOME:
<S> <C>
Interest income $ 85,513
Dividend income 37,327
----------------
Total investment income 122,840
----------------
EXPENSES:
Investment advisory fee 389,762
Administration fee 49,734
Shareholder servicing and accounting costs 135,325
Custody fees 17,444
Federal and state registration 55,698
Professional fees 85,964
Reports to shareholders 21,875
Directors' fees and expenses 1,589
Amortization of organizational expenses 16,795
Distribution expense - Class A shares 95,437
Distribution expense - Class C shares 8,019
Other 2,746
----------------
Total operating expenses before reimburement and 880,388
interest expense
Less: Reimbursement from Advisor (204,561)
----------------
Total operating expenses before interest expense 675,827
Interest expense 17,875
----------------
Total expenses 693,702
----------------
NET INVESTMENT LOSS (570,862)
----------------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Net realized gain on investment transactions 260,879
Change in unrealized appreciation/depreciation on investments 26,470,077
----------------
Net realized and unrealized gain on investmnets 26,730,956
----------------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS $ 26,160,094
================
</TABLE>
See notes to the financial statements.
GRAND PRIX FUND
STATEMENT OF CASH FLOWS - YEAR ENDED OCTOBER 31, 1999
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CASH PROVIDED (USED) BY FINANCING ACTIVITES
<S> <C> <C>
Sales of Capital Shares $ 92,563,756
Repurchases of Capital Shares (18,089,596)
-------------------------
Cash Provided by Capital Share Transactons 74,474,160
Cash Provided by Borrowings 10,000,000
Distributions Paid in Cash* 0
-------------------------
$ 84,474,160
------------------
CASH PROVIDED (USED) BY OPERATIONS:
Purchases of Investments (376,867,655)
Net puPurchases of Short-Term Investments (4,097,455)
Proceeds from Sales of Investments 304,198,613
-------------------------
(76,766,497)
-------------------------
Net Investment Loss (570,862)
Net Change in Receivables/Payables Related to Operations (4,809,452)
-------------------------
(5,380,314)
-------------------------
(82,146,811)
------------------
Net Increase in Cash 2,327,349
Cash, Beginning of Year 0
------------------
Cash, End of Year $ 2,327,349
==================
</TABLE>
*Non-cash financing activities include reinvestment of dividends of $312,180.
Grand Prix Fund
Statement of Changes in Net Assets
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
DECEMBER 31,1997 (1)
YEAR ENDED THROUGH
OCTOBER 31, 1999 OCTOBER 31, 1998
--------------------- ---------------------
<S> <C> <C>
OPERATIONS:
Net investment loss $ (570,862) $ (10,705)
Net realized gain on investment transactions 260,879 296,012
Change in unrealized apperciation/depreciation on investments 26,470,077 174,775
--------------------- ---------------------
Net increase in net assets resulting from operations 26,160,094 460,082
--------------------- ---------------------
DISTRIBUTIONS TO CLASS A SHAREHOLDERS FROM
NET REALIZED GAINS (312,180) -
--------------------- ---------------------
CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold 92,563,756 1,045,326
Shares issued to holders in reinvestment of dividends 312,180
Cost of shares redeemed (18,089,596) (10,000)
--------------------- ---------------------
Net increase in net assets resulting from capital share transactions 74,786,340 1,035,326
--------------------- ---------------------
TOTAL INCREASE IN NET ASSETS 100,634,254 1,495,408
NET ASSETS:
Beginning of period 1,595,408 100,000
--------------------- ---------------------
End of period $ 102,229,662 $ 1,595,408
===================== =====================
</TABLE>
(1)Commencement of operations.
See notes to the financial statements.
GRAND PRIX FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Selected per share data is based on a share of beneficial interest outstanding
throughout each period.
<TABLE>
<CAPTION>
Class C Shares Class A Shares
Class A Shares August 5, 1999(1) December 31, 1997(1)
Year Ended through through
October 31, 1999 October 31, 1999 October 31, 1998
----------------- ----------------- ------------------
<S> <C> <C> <C>
Per Share Data:
Net asset value, beginning of period $ 14.42 $ 20.55 $ 10.00
----------------- ----------------- ------------------
Income from investment operations:
Net investment loss (0.32)(6) (0.13)(6) (0.10)
Net realized and unrealized gains on investments 16.74 7.75 4.52
----------------- ----------------- ------------------
Total from investment operations 16.42 7.62 4.42
----------------- ----------------- ------------------
Less distributions from net realized gains (2.63) - -
----------------- ----------------- ------------------
Net asset value, end of period $ 28.21 $ 28.17 $ 14.42
================= ================= ==================
Total Return (2)(3) 131.51% 37.08% 44.20%
Supplemental data and ratios:
Net assets, end of period (000's) $ 92,500 $ 9,730 $ 1,595
Ratio of operating expenses to average net assets(4) 1.72% 2.47% 1.65%
Ratio of interest expense to average net assets(4) 0.04% 0.19% -
Ratio of net investment loss to average net assets(4) (1.45%) (2.41%) (1.03%)
Portfolio turnover rate(5) 764.3% 764.3% 521.6%
</TABLE>
(1)Commencement of operations.
(2)Not annualized.
(3)The total return does not reflect the 5.25% and 1.00% front-end sales
charge for the Class A and Class C Shares, respectively.
(4)Net of reimbursements and waivers. Without reimbursements and waivers,
the ratio of operating expenses to average net assets for the Class A
Shares for the periods ended October 31, 1999 and October 31, 1998 would
have been 2.24% and 15.93%, repectively, and for the Class C Shares for
the period ended October 31, 1999 would have been 3.14%. The ratio of net
investment loss to average net assets for the Class A Shares for the
periods ended October 31, 1999 and October 31, 1998 would have been
(1.97)% and (15.31)%, repectively, and for the Class C Shares for the
period ended October 31, 1999 would have been (3.08)%.
(5)Portfolio turnover is calculated on the basis of the Fund as a whole
without distinguishing between the classes of shares issued.
(6)Net investment loss per share represents net investment loss divided by
the monthly average shares of beneficial interest outstanding.
See notes to the financial statements.
GRAND PRIX FUND
SCHEDULE OF INVESTMENTS - OCTOBER 31, 1999
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES VALUE
------ ------
<S> <C> <C>
COMMON STOCKS - 104.0%
COMPUTERS - 9.7%
20,000 Apple Computer, Inc. * $ 1,602,500
65,000 Gateway Inc.* 4,294,063
38,000 Sun Microsystems, Inc.* 4,020,875
----------------
9,917,438
----------------
COMPUTER SERVICES - 4.1%
33,000 Sapient Corporation* 4,219,875
----------------
COMPUTER STORAGE DEVICES - 4.9%
46,000 VERITAS Software Corporation* 4,962,250
----------------
ENERGY - 3.8%
67,000 Calpine Corporation* 3,860,875
----------------
SEMICONDUCTORS - 20.7%
45,000 Applied Micro Circuits Corporation* 3,501,563
30,000 Microchip Technology Incorporated* 1,998,750
40,000 QLogic Corporation* 4,165,000
44,000 SDL, Inc.* 5,425,750
55,000 TriQuint Semiconductor, Inc.* 4,400,000
22,000 Xilinx, Inc.* 1,729,750
----------------
21,220,813
----------------
SOFTWARE - 24.9%
60,600 Adobe Systems Incorporated 4,238,212
59,000 Business Objects S.A. - ADR* 4,248,000
40,000 Check Point Software Technologies Ltd.* 4,627,500
60,000 i2 Technologies, Inc.* 4,736,250
60,000 Legato Systems, Inc.* 3,225,000
40,000 Siebel Systems, Inc.* 4,392,500
----------------
25,467,462
----------------
TELECOMMUNICATIONS - 7.8%
32,000 Telephone and Data Systems, Inc. 3,688,000
48,000 United States Cellular Corporation* 4,248,000
----------------
7,936,000
----------------
See notes to the financial statements.
SHARES VALUE
------- ------
TELECOMMUNICATION EQUIPMENT - 23.7%
40,000 Comverse Technology, Inc.* $ 4,540,000
45,000 E-Tek Dynamics, Inc.* 2,998,125
33,000 JDS Uniphase Corporation* 5,506,875
40,000 Nokia Oyj - ADR 4,622,500
40,000 Powerwave Technologies, Inc.* 2,602,500
18,000 QUALCOMM Incorporated* 4,009,500
----------------
24,279,500
----------------
UNIT INVESTMENT TRUST - 4.4%
34,000 Nasdaq - 100 Shares* 4,471,000
----------------
TOTAL COMMON STOCKS (Cost $79,690,361) 106,335,213
----------------
PRINCIPAL
AMOUNT
------
SHORT-TERM INVESTMENTS - 4.0%
VARIABLE RATE DEMAND NOTES# - 4.0%
$ 4,116,096 Firstar Bank, 5.1588% $ 4,116,096
----------------
TOTAL SHORT-TERM INVESTMENTS (Cost $4,116,096) 4,116,096
----------------
TOTAL INVESTMENTS - (COST $83,806,457) - 108.0% 110,451,309
Liabilities, less Other Assets - (8.0%) (8,221,647)
----------------
TOTAL NET ASSETS - 100.0% $ 102,229,662
================
</TABLE>
* Non-income producing security.
# 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 October 31, 1999.
See notes to the financial statements.
GRAND PRIX FUND
NOTES TO THE FINANICAL STATEMENTS - OCTOBER 31, 1999
- --------------------------------------------------------------------------------
1. ORGANIZATION
The Grand Prix Funds, Inc. ( the "Corporation") was incorporated on October
30, 1997 as a Maryland Corporation and is registered as an open-end
management investment company under the Investment Company act of 1940 (the
"1940 Act"). The Corporation is authorized to issue its shares in series,
each series representing a distinct portfolio with its own investment
objectives and policies. The Corporation currently offers one series of
shares: The Grand Prix Fund (the "Fund"). The shares of common stock of the
Fund are further divided into two classes: Class A and Class C. Each class
of shares has identical rights and privileges except with respect to 12b-1
fees and voting rights on matters affecting a single class of shares. The
Fund commenced investment operations on December 31, 1997. Effective
December 1, 1998, the Fund changed from a no-load mutual fund to a load
fund.
2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently
followed by the Fund in the preparation of its financial statements. These
policies are in conformity with generally accepted accounting principles
("GAAP"). The presentation of financial statements in conformity with GAAP
requires management to make estimates and assumptions that affect the
reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates and assumptions.
(A) INVESTMENT VALUATION - Securities are stated at value. Securities which are
traded on a recognized stock exchange are valued at the last sale price on the
securities exchange on which such securities are primarily traded. Securities
traded on only over-the-counter markets are valued on the basis of closing
over-the-counter trade prices. Securities for which there were no transactions
are valued at the average of the latest bid and asked prices. Debt securities
(other that short-term instruments) are valued at prices furnished by a pricing
service. Debt instruments maturing within 60 days are valued by the amortized
cost method. Any securities for which market quotations are not readily
available are valued at their fair value as determined in good faith by Target
Investors (the "Advisor") pursuant to guidelines established by the Board of
Directors.
(B) ORGANIZATION COSTS - Costs incurred by the Fund in connection with its
organization, registration and the initial public offering of shares have been
deferred and will be amortized over the period of benefit, but not to exceed
five years from the date upon which the Fund commenced its investment
activities. If any of the original shares of the Fund purchased by the initial
shareholder are redeemed prior to the end of the amortization period, the
redemption proceeds will be reduced by the pro rata share of the unamortized
costs as of the date of redemption. The pro rata share by which the proceeds
are reduced will be derived by dividing the number of original shares of the
Fund being redeemed by the total number of original shares outstanding at the
time of redemption.
(C) FEDERAL INCOME AND EXCISE TAXES - The Fund intends to meet the
requirements of the Internal Revenue Code applicable to regulated
investment companies and to distribute substantially all net investment
company taxable income and net capital gains to shareholders in a
manner which results in no tax cost to the Fund. Therefore, no federal
income or excise tax provision is required.
(d) DISTRIBUTION TO SHAREHOLDERS - Dividends from net investment income
will be declared and paid annually. Distributions of net realized
gains, if any, will be declared at least annually. Distributions to
shareholders are recorded on the ex-dividend date. The Fund may
periodically make reclassifications among certain of its capital
accounts as a result of the recognition and characterization of certain
income and capital gain distributions determined annually in
accordance with federal tax regulations which may differ from generally
accepted accounting principles. Accordingly, at October 31, 1999,
reclassifications were recorded to decrease undistributed net investments
loss by $570,862, decrease undistributed net realized gain on investments
by $565,363, and decrease capital stock by $5,499.
(e) SECURITIES TRANSACTION AND INVESTMENT INCOME - Investment transactions are
recorded on the trade date for financial statement purposes. The Fund
determines the gain or loss realized from investment transactions by
comparing the original cost of the security lot sold with the net sale
proceeds. Dividend income is recognized on the ex-dividend date and
interest income is recognized on an accrual basis. Acquisition and market
discounts are amortized over the life of the security.
3. SHARES OF BENEFICAL INTEREST
Transactions in shares of beneficial interest for the periods ending
October 31 were as follows:
1999
$ SHARES
-- ---------
CLASS A SHARES:
Shares sold $84,276,270 3,988,061
Shares issued to
holders in
reinvestment of
dividends 312,180 21,770
Shares redeemed (18,069,123) (841,135)
------------ ---------
Net increase $66,519,327 3,168,696
===========
SHARES OUTSTANDING:
Beginning of period 110,670
---------
End of period 3,279,366
=========
CLASS C SHARES
Shares sold $ 8,287,486 346,298
Shares issued to
holders in
reinvestment of
dividends -- --
Shares redeemed (20,473) (859)
-------- -----
Net increase $ 8,267,013 345,439
===========
SHARES OUTSTANDING:
Beginning of period --
--------
End of period 345,439
===========
TOTAL INCREASE $ 74,786,340
===========
1998
$ SHARES
-- ---------
CLASS A SHARES:
Shares sold $ 1,045,326 101,364
Shares redeemed (10,000) (694)
-------- -----
Net increase $ 1,035,326 100,670
SHARES OUTSTANDING:
Beginning of period 10,000
-------
End of period 110,670
=========
4. INVESTMENT TRANSACTIONS
The aggregate purchases and sales of securities, excluding short-term
investments and U.S. government obligations, for the Fund for the year ended
October 31, 1999 are summarized below. There were no purchases
of sales of long-term U.S. government securities.
Purchases $384,852,276
Sales $306,845,300
At October 31, 1999, gross unrealized appreciation and depreciation of
investments, based on cost for federal income tax purposes of $85,623,699 were
as follows:
Unrealized appreciation $26,657,229
Unrealized depreciation (1,829,619)
-----------
Net unrealized appreciation on
investments $24,827,610
===========
5. CREDIT FACILITY
Firstar Bank, N.A. (the "Bank") has made available to the Fund a $12
million credit facility pursuant to a Loan and Security Agreement
("Agreement") dated September 27, 1999 for the purpose of purchasing
portfolio securities. For the period September 27, 1999 to October 31,
1999, the interest rate on the outstanding principal amount was the Bank's
Prime Rate (weighted average rate of 8.25% during the year ended October
31, 1999). Advances are collateralized by a first lien against the Fund's
assets. During the year ended October 31,1999, the Fund had an outstanding
average daily balance of $257,534. The maximum amount outstanding during
the year ended October 31, 1999, was $10,000,000. Interest expense amounted
to $17,875 for the year ended October 31, 1999. At October 31, 1999, the
Fund had a loan payable balance of $10,000,000 and the assets
collateralizing the Agreement amounted to $120,698,907.
6. INVESTMENT ADVISOR
The Fund has as agreement with the Advisor, with whom certain officers and
directors of the Fund are affiliated, to furnish investment advisory
services to the Fund. Under the terms of this agreement, the Advisor is
compensated at an annual rate of 1.00% of average daily net assets of the
Fund . For the fiscal period ending October 31, 1999, the Advisor agreed to
waive its investment advisory fee and/or reimburse the Fund's operating
expenses (exclusive of brokerage, interest, taxes and extraordinary
expenses) to the extent necessary to ensure that the Fund's total operating
expenses did not exceed 1.72% and 2.47% of the average net assets of the
Class A and Class C shares, respectively. During the period ended October
31, 1999, the Advisor waived investment advisory fees totaling $ 204,561.
7. SERVICE AND DISTRIBUTION PLAN
The Fund has adopted Service and Distribution Plans (the "Plans") pursuant
to Rule 12b-1 under the 1940 Act. The Plans authorize payments by the Fund
in connection with the distribution of its shares at an annual rate, as
determined from time to time by the Board of Directors, of up to 0.25% of
the Fund's average daily net assets for the Class A shares and up to 1.00%
for the Class C shares. The currently approved rate is 0.25% and 1.00% of
average daily assets for the Class A and Class C shares, respectively.
Amounts paid under the Plans by the Fund may be spent by the Fund on any
activities or expenses primarily intended to result in the sale of shares
of the Fund, including but not limited to, advertising, compensation for
sales and marketing activities of financial institutions and others such as
dealers and distributors, shareholder account servicing, the printing and
mailing of prospectuses other than current shareholders and the printing
and mailing of sales literature. The Fund incurred $95,437 for the Class A
Shares and $8,019 for the Class C Shares pursuant to the Plans for the year
ended October 31, 1999.
This report and the financial statements contained herein are submitted for
the general information of the shareholders of the Fund. This report may be
distributed to others only if preceded or accompanied by a current
prospectus. The Grand Prix Fund is distributed by T.O. Richardson
Securities, Inc., a member of the NASD.
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
To the Board of Directors and Shareholders of the
Grand Prix Fund
We have audited the accompanying statement of assets and liabilities, including
the schedule of investments, of the Grand Prix Fund (the Fund), as of October
31, 1999, the related statements of operations, cash flows and changes in net
assets and the financial highlights for the periods indicated therein. These
financial statements and financial highlights are the responsibility of the
Fund's management. Our responsibility is to express an opinion on the financial
statements and financial highlights based on our audits.
We conducted our audits 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 misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
October 31, 1999, by correspondence with the custodian. 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
Grand Prix Fund at October 31, 1999, and the results of its operations, cash
flows and changes in its net assets and the financial highlights for the periods
indicated therein, in conformity with generally accepted accounting principles.
/s/ Ernst & Young
Milwaukee, Wisconsin
November 19, 1999
Grand Prix Fund
P.O. Box 701
Milwaukee, WI 53201
For Fund information and literature, call 800-307-4880.
For account balances, prices, and other information about your Grand Prix
account, call 800-432-4741.
