The
Henssler
Equity
Fund
ANNUAL REPORT
April 30, 1999
The Henssler Equity Fund
1281 Kennestone Circle, Suite 100
Marietta, Georgia 30066
1-800-936-3863
www.henssler.com
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The Henssler Equity Fund
SCHEDULE OF INVESTMENTS April 30, 1999
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Shares Value
-------- --------
<S> <C> <C>
COMMON STOCK -- 97.94%
Consumer Cyclical -- 1.59%
The Walt Disney Corp. 3,600 $114,300
Genuine Parts Co. 2,765 82,950
Oakwood Homes Corp. 3,735 51,823
--------------
249,073
--------------
Consumer Staples -- 14.90%
Anheuser-Busch Companies, Inc. 4,585 335,278
Gillette Co. 3,510 183,178
Kimberly Clark Corp. 4,385 268,855
Newell Co. 4,635 219,873
Pepsico, Inc. 10,775 398,002
Phillip Morris Co. 7,185 251,924
Procter & Gamble Co. 3,485 326,937
Sysco Corp. 8,525 253,086
TCA Cable Television, Inc. 2,000 99,625
--------------
2,336,758
--------------
Energy -- 6.50%
Mobil Corp. 4,485 469,804
Repsol SA ADR 5,535 91,328
Royal Dutch Petroleum Co. 3,880 227,708
Schlumberger, LTD 3,600 229,950
--------------
1,018,790
--------------
Financials -- 18.86%
American International Group, Inc. 4,345 510,266
Banc One Corp. 5,375 317,125
Charter One Financial, Inc. 3,000 93,750
Fannie Mae 6,830 484,503
First Union Corp. 4,685 259,432
J. P. Morgan & Co. Inc. 2,395 322,726
Jefferson Pilot Corp. 4,725 318,347
MBNA Corp. 18,442 519,834
Regions Financial Corp. 3,485 131,559
--------------
2,957,542
--------------
Health -- 15.92%
Abbott Laboratories 4,835 234,195
American Home Products Corp. 4,500 274,500
Amgen, Inc.* 2,700 165,881
Bristol-Myers Squibb Co. 4,590 291,752
Johnson & Johnson 4,685 456,787
Merck & Co. 4,490 315,422
Pharmacia & Upjohn, Inc. 2,500 140,000
Schering Plough Corp. 4,420 213,541
Shared Medical Systems Corp. 4,450 241,691
Watson Pharmaceuticals, Inc.* 4,000 162,000
--------------
2,495,769
--------------
Industrial Cyclicals -- 12.00%
Deere & Co. 5,365 230,695
General Electric Co. 2,295 242,122
Honeywell, Inc. 1,795 170,076
Nucor Corp. 3,165 185,746
PPG Industries, Inc. 1,595 103,575
Paccar, Inc. 3,300 184,800
Potash Corporation of Saskatchewan, Inc. 2,400 145,200
Raytheon Co. Cl A 2,000 138,375
Valspar Corp. 4,535 157,024
Vulcan Materials Co. 6,785 323,984
--------------
1,881,597
--------------
Retail -- 7.69%
Albertson's, Inc. 3,345 172,267
Dayton Hudson Corp. 4,785 322,090
Lowe's Cos., Inc. 2,000 105,500
Home Depot, Inc. 3,480 208,583
Ross Stores, Inc. 5,685 261,155
Walgreen Co. 5,070 136,256
--------------
1,205,851
--------------
Technology -- 17.10%
Applied Materials, Inc.* 9,150 490,669
Cisco Systems, Inc.* 2,525 288,008
Equifax, Inc. 8,680 311,937
Harris Corp. 4,785 165,382
Hewlett-Packard Co. 4,485 353,754
Intel Corp. 9,570 585,564
Lucent Technologies, Inc. 4,390 263,949
Oracle Corp.* 8,190 221,642
--------------
2,680,905
--------------
Telecommunications -- 3.38%
AT & T Corp. 3,300 166,650
CenturyTel, Inc. 4,823 194,106
Vodafone Group PLC ADR 945 169,687
--------------
530,443
--------------
TOTAL COMMON STOCK (COST
$13,792,718) -- 97.94% 15,356,728
--------------
MISCELLANEOUS ASSETS -- 3.06%
Star Treasury Fund (Cost $480,461) 480,461 480,461
--------------
TOTAL INVESTMENTS (COST
$14,273,179) -- 101.00% $15,837,189
OTHER ASSETS AND LIABILITIES, NET
- -- (1.00)% (157,319)
--------------
NET ASSETS -- 100.00% $15,679,870
==============
* Non-income producing security.
See notes to financial statements.
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The Henssler Equity Fund
STATEMENT OF ASSETS AND LIABILITIES April 30, 1999
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Assets:
Investments, at market (identified cost
$14,273,179) $15,837,189
Receivables:
Dividends and interest 9,687
Fund shares sold 98,469
----------------
Total assets 15,945,345
----------------
Liabilities:
Payables:
Investment securities purchased 251,394
Due to advisor 14,081
----------------
Total liabilities 265,475
----------------
Net Assets $15,679,870
================
Net Assets consist of:
Common stock $1,335,379
Additional capital paid -- in 12,778,553
Distributions in excess of net investment income (2,001)
Accumulated realized gain on investments 3,929
Net unrealized gain on investments 1,564,010
----------------
Net Assets, for 1,335,382 shares
outstanding $15,679,870
================
Net Asset Value, offering and redemption
price per share $11.74
================
See notes to financial statements.
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The Henssler Equity Fund
STATEMENT OF OPERATIONS
FOR THE PERIOD ENDED APRIL 30, 1999*
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Investment Income:
Interest $8,196
Dividends 93,276
--------------
Total investment income 101,472
--------------
Expenses:
Investment advisory fees 36,969
Administration fee 51,756
--------------
Total expenses 88,725
--------------
Net investment income 12,747
--------------
Realized & unrealized gain on
investments:
Net realized gain on investments 3,929
Net change in unrealized appreciation on
investments 1,564,010
--------------
Net gain on investments 1,567,939
--------------
Net increase in net assets resulting from
operations $1,580,686
==============
* The Henssler Equity Fund commenced operations on June 10, 1998.
See notes to financial statements.
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The Henssler Equity Fund
STATEMENTS OF CHANGES IN NET ASSETS
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For the Period Ended April 30, 1999*
Increase in Net Assets
Operations:
Net investment income $12,747
Net realized gain on investments 3,929
Net change in unrealized appreciation on
investments 1,564,010
--------------
Net increase in net assets resulting from
operations 1,580,686
Distributions to shareholders from:
Net investment income (14,748)
--------------
Increase in net assets from Fund share
transactions 14,113,932
--------------
Increase in net assets 15,679,870
Net Assets:
Beginning of period 0
--------------
End of period $15,679,870
==============
* The Henssler Equity Fund commenced operations on June 10, 1998.
See notes to financial statements
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The Henssler Equity Fund
FINANCIAL HIGHLIGHTS
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Per Share Data (For a Share Outstanding from June 10, 1998 through April 30, 1999)
For the Period
April 30, 1999
--------------
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Net Asset Value, Beginning of
Period $10.00
--------
Income From Investment Operations:
Net investment income 0.02
Net gains on securities (both
realized and unrealized) 1.74
--------
Total from investment operations 1.76
--------
Distributions:
Net investment income (0.02)
--------
Net Asset Value, End of Period $11.74
========
Total Return 17.57%
Ratios/Supplemental Data
Net assets, end of period (in
000s) $15,680
Ratio of expenses to average
net assets 1.20%*
Ratio of net investment income
to average net assets 0.17%*
Portfolio turnover rate 14%
* Annualized
See notes to financial statements
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The Henssler Equity Fund
NOTES TO THE FINANCIAL STATEMENTS
April 30, 1999
1.ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
The Henssler Equity Fund (the "Company") was incorporated under the laws
of the state of Maryland on February 12, 1998, and consists solely of The
Henssler Equity Fund (the "Fund"). The Company is registered as a no-load,
open-end diversified management investment company of the series type
under the Investment Company Act of 1940 (the "1940 Act"). The Fund's
investment strategy is to emphasize long-term capital appreciation and
safety of principal. The Fund became effective with the SEC on June 8,
1998 and commenced operations on June 10, 1998.
The costs incurred in connection with the organization, initial
registration and public offering of shares have been paid by Henssler
Asset Management, LLC (the "Advisor"). Accordingly, no organization costs
have been recorded by the Fund.
The following is a summary of significant accounting policies consistently
followed by the Fund.
a) Investment Valuation -- Common stocks and other equity-type securities
listed on a securities exchange are valued at the last quoted sales price
on the day of the valuation. Price information on listed stocks is taken
from the exchange where the security is primarily traded. Securities that
are listed on an exchange but which are not rated on the valuation date
are valued at the most recent bid prices. Other assets and securities for
which no quotations are readily available are valued at fair value as
determined in good faith by the Investment manager under the supervision
of the Board of Directors. Short-term instruments (those with remaining
maturities of 60 days or less) are valued at amortized cost, which
approximates market.
b) Federal Income Taxes -- No provision for federal income taxes has been
made since the Fund has complied to date with the provision of the
Internal Revenue Code applicable to regulated investment companies and
intends to so comply in the future and to distribute substantially all
of its net investment income and realize capital gains in order to
relieve the Fund from all federal income taxes.
c) Distributions to Shareholders -- Dividends from net investment income
and distributions of net realized capital gains, if any, will be declared
and paid at least annually. Income and capital gain distributions are
determined in accordance with income tax regulations that may differ
from generally accepted accounting principles.
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 form
those estimates.
e) Other -- Investment and shareholder transactions are recorded on trade
date. The Fund determines the gain or loss realized from the 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.CAPITAL SHARE TRANSACTIONS
Transactions in shares of the Fund for the period ended April 30, 1999
were as follows:
Shares Amount
------------ ------------
Sold 1,404,150 $14,897,761
Reinvested 1,323 14,749
Redeemed (70,091) (798,578)
------------ ------------
Net Increase 1,335,382 $14,113,932
============ ============
3.INVESTMENT TRANSACTIONS
The aggregate purchases and sales of investments, excluding short-term
investments, by the Fund for the period ended April 30, 1999, were as
follows:
Purchases $14,930,911
Sales 1,142,122
At April 30, 1999, gross unrealized appreciation and depreciation of
investments for tax purposes were as follows:
Appreciation $1,779,485
(Depreciation) (215,475)
------------
Net appreciation on investments 1,564,010
============
At April 30, 1999, the cost of investments for federal income tax purposes
was $14,273,179.
4.ADVISORY FEE AND OTHER RELATED PARTY TRANSACTIONS
The Fund has entered into a Management Agreement with Henssler Asset
Management, LLC (the "Advisor") to provide investment management services
to the Fund. Pursuant to the Advisory Agreement, the Advisor is entitled
to receive a fee, calculated daily and payable monthly at the annual rate
of 0.50% as applied to the Fund's daily net assets. For the period ended
April 30,1999, the Advisor received advisory fees of $36,969.
The Fund has entered into an Operating Services Agreement (the "Servicing
Agreement") with the Advisor to provide or arrange for day-to-day
operational services to the Fund. Pursuant to the Servicing Agreement, the
Advisor is entitled to receive a fee, calculated daily and payable monthly
at the annual rate of 0.70% as applied to the Fund's daily net assets. For
the period ended April 30, 1999, the Advisor received fees of $51,756.
The Fund and the Advisor have entered into an Investment Company Services
Agreement (the "ICSA") with Declaration Service Company to provide
day-to-day operational services to the Fund including, but not limited to,
accounting, administrative, transfer agent, dividend disbursing, registrar
and recordkeeping services.
The Fund and the Advisor have entered into a Distribution Agreement with
Declaration Distributors, Inc. to provide distribution services to the
Fund. Declaration Distributors, Inc. serves as underwriter/distributor of
the Fund.
Certain directors and officers of the Fund are directors and officers of
the Advisor.
Advisor
Henssler Asset Management, LLC
1281 Kennestone Circle, Suite 100
Marietta, Georgia 30066
Distributor
Declaration Distributors, Inc.
555 North Lane, Suite 6160
Conshohocken, PA 19428
Custodian
Firstar Bank, N.A.
Firstar Bank Center
425 Walnut Street
Cincinnati, Ohio 45202
Transfer, Redemption, and Dividend Disbursing Agent
Declaration Service Company
555 North Lane, Suite 6160
Coshohocken, PA 19428
Independent Accountants
McCurdy & Associates CPA's, Inc.
27955 Clemens Road
Westlake, Ohio 44155
Legal Counsel
Kilpatrick Stockton LLP
1100 Peachtree Street
Suite 2800
Atlanta, Georgia 30309
This report is not authorized for distribution to prospective investors
unless preceded or accompanied by a current prospectus.
Annual Report to Shareholders
for the period ended April 30, 1999
