ANNUAL SHAREHOLDER LETTER
MONTEAGLE FIXED INCOME FUND FALL 2000
DEAR SHAREHOLDER,
As the new millennium begins a new era in history, so does the Monteagle Fixed
Income Fund signal the start of a new fund for intermediate-term bond investors.
Both events have brought forth great expectations.
As we began the year, the concern for most bond investors was the possibility of
increasing inflation in the economy. The Federal Reserve Board had been paying
close attention to the seemingly, never-ending robust economy resulting in tight
labor markets and the potential for higher wages and prices. In response, the
Federal Open Market Committee raised short-term interest rates three times since
the beginning of 2000. The last raise coming in May has likely signaled the end
of Fed tightening, but maintained the bias the Fed has had for combating
inflation.
Bond prices in the intermediate and long-term markets acted positively to the
last Fed increase. The bond market took comfort in the fact that the Fed had
acted aggressively to avert a potential inflationary spiral. Most bond market
participants correctly perceived that the Fed was probably done tightening for
2000 and no further action would be taken pending the outcome of the
Presidential election in the fall.
Prior to the last Fed rate increase our proprietary bond market model (the "BMW"
or Bond Market Watch) signaled a potential for lower interest rates. As interest
rates fall bond prices rise, with intermediate and long-term bonds usually
rising higher in price than shorter maturities. We acted upon this signal by
lengthening our average maturity in the portfolio to take advantage of this
anticipated interest rate drop. This strategy proved very beneficial to
investors in the Fund. Intermediate-term interest rates have come down nearly
100 basis points since the beginning of the year.
The Fund also took advantage of wider interest rate or yield differences between
the Treasury bond market and the corporate bond market. This yield rate
difference, known as the "spread," caused high-grade corporate bonds to be more
attractive on a total return basis than other bond market sectors.
Two factors will likely cause some market volatility in the near future. First,
the outcome of the election, which may have long-term economic consequences; and
second, the rise in world petroleum prices, which eventually work their way into
the world's economies. As we take steps to keep portfolio volatility at a
moderate level, we are confident in our ability and tools used to manage the
Fund for the intermediate-term fixed income investor.
Date LB Int Gvt./Credit Monteagle Fixed Income
Index - $10,487 - $10,454
12/20/99 10,000.00 10,000.00
12/31/99 9,967.00 9,976.25
1/31/00 9,930.12 9,929.74
2/29/00 10,011.55 10,004.40
3/31/00 10,115.67 10,109.70
4/28/00 10,092.40 10,085.23
5/31/00 10,108.55 10,058.92
6/30/00 10,286.46 10,240.10
7/31/00 10,364.64 10,323.22
8/31/00 10,486.94 10,453.73
THIS GRAPH, PREPARED IN ACCORDANCE WITH SEC REGULATIONS,
COMPARES A $10,000 INVESTMENT IN THE FUND WITH A SIMILAR INVESTMENT IN THE
UNMANAGED LEHMAN BROTHERS INTERMEDIATE TERM GVT./CREDIT BOND INDEX ON DECEMBER
20, 1999 HELD THROUGH AUGUST 31, 2000. RESULTS FOR THE FUND AND LEHMAN BROTHERS
INTERMEDIATE TERM GOV./CREDIT BOND INDEX INCLUDE THE REINVESTMENT OF DIVIDEND
AND CAPITAL GAIN DISTRIBUTIONS IF ANY. THE FUND'S PERFORMANCE IS AFTER ALL FEES.
THE INDEX DOES NOT HAVE ANY FEES. INVESTMENT RETURNS AND PRINCIPAL VALUE OF AN
INVESTMENT WILL FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN REDEEMED, MAY BE
WORTH MORE OR LESS THAN THEIR ORIGINAL COST. TOTAL RETURN REPRESENTS PAST
PERFORMANCE AND IS NOT PREDICTIVE OF FUTURE RESULTS.
<TABLE>
<CAPTION>
PERFORMANCE
<S> <C> <C>
Six Month Total Return Since
Inception
2/29/00 - 8/31/00 12/20/99 -8/31/00
----------------- -----------------
MONTEAGLE FIXED INCOME 4.49% 4.54%
FUND
LB IT Gvt./Credit TR 4.75% 4.87%
</TABLE>
Sincerely,
HOWE AND RUSLING
Thomas G. Rusling
President
MONTEAGLE LARGE-CAP FUND FALL 2000
DEAR SHAREHOLDER,
The three main factors that have driven the bull market over the past several
years have been low inflation, strong earnings growth, and an accommodative
Federal Reserve. Two of those factors are no longer present. Monetary policy has
become more restrictive, which has caused a slowdown in earnings growth.
The net result has been the most difficult equity markets in a decade.
Technology stocks have been particularly hard hit with NASDAQ falling as much as
40% from its high, a bear market by any definition. Internet stocks were quite
simply a disaster with many of the stocks falling over 80% from their highs.
Fortunately, we had taken some protective measures that mitigated the effect of
the decline in tech stocks. First, we completely avoided the speculation in the
"dot.coms" (now redubbed the "dot.bombs"). This was simply a function of
following our discipline of investing in companies with consistent earnings
growth selling at reasonable valuations.
In addition, our discipline indicated that the valuation of technology stocks,
particularly compared to their "old economy" brethren, had become excessively
high. As a result, we systematically reduced our holdings in technology stocks
throughout the late winter and early spring. We currently have the lowest
exposure in technology stocks that we have had in several years.
This leaves us in an excellent position to take advantage of increasingly
attractive valuations in tech stocks. We still believe that technology is the
growth engine for the economy and the best place for growth investors over time.
Over the next several months we anticipate taking advantage of the wonderful
opportunities the technology sell off has created.
Date S&P 500 Index Monteagle Large-Cap Fund
- $10,410 - $9,920
1/18/00 10,000.00 10,000.00
1/31/00 9,497.63 9,390.00
2/29/00 9,318.02 9,430.00
3/31/00 10,229.02 9,860.00
4/28/00 9,921.39 9,630.00
5/31/00 9,717.72 9,390.00
6/30/00 9,957.32 9,430.00
7/31/00 9,801.41 9,640.00
8/31/00 10,409.87 9,920.00
THIS GRAPH, PREPARED IN ACCORDANCE WITH SEC REGULATIONS, COMPARES A $10,000
INVESTMENT IN THE FUND WITH A SIMILAR INVESTMENT IN THE UNMANAGED S&P 500 INDEX
ON JANUARY 18, 2000 HELD THROUGH AUGUST 31, 2000. RESULTS FOR THE FUND AND S&P
500 INDEX INCLUDE THE REINVESTMENT OF DIVIDEND AND CAPITAL GAIN DISTRIBUTIONS IF
ANY. THE FUND'S PERFORMANCE IS AFTER ALL FEES. THE INDEX DOES NOT HAVE ANY FEES.
INVESTMENT RETURNS AND PRINCIPAL VALUE OF AN INVESTMENT WILL FLUCTUATE SO THAT
AN INVESTOR'S SHARES, WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR
ORIGINAL COST. TOTAL RETURN REPRESENTS PAST PERFORMANCE AND IS NOT PREDICTIVE OF
FUTURE RESULTS.
<TABLE>
<CAPTION>
PERFORMANCE
<S> <C> <C>
Six Month Total Return Since
Inception
2/29/00 - 8/31/00 1/18/00 -8/31/00
----------------- ----------------
MONTEAGLE LARGE-CAP FUND 5.20% (0.80)%
S&P 500 Index 11.72% 4.10%
</TABLE>
Sincerely,
HOWE AND RUSLING
Thomas G. Rusling
President
MONTEAGLE OPPORTUNITY GROWTH FUND FALL 2000
DEAR SHAREHOLDER,
Date S&P 500 Index Monteagle Opportunity Growth Fund
- $11,023 - $11,210
12/20/99 10,000.00 10,000.00
12/31/99 10,588.60 11,360.00
1/31/00 10,056.66 11,400.00
2/29/00 9,866.48 17,100.00
3/31/00 10,831.10 13,710.00
4/28/00 10,505.36 11,300.00
5/31/00 10,289.70 9,270.00
6/30/00 10,543.41 10,010.00
7/31/00 10,378.32 9,480.00
8/31/00 11,022.59 11,210.00
THIS GRAPH, PREPARED IN ACCORDANCE WITH SEC REGULATIONS, COMPARES A $10,000
INVESTMENT IN THE FUND WITH A SIMILAR INVESTMENT IN THE UNMANAGED S&P 500 INDEX
ON DECEMBER 20,1999 HELD THROUGH AUGUST 31, 2000. RESULTS FOR THE FUND AND S&P
500 INDEX INCLUDE THE REINVESTMENT OF DIVIDEND AND CAPITAL GAIN DISTRIBUTIONS IF
ANY. THE FUND'S PERFORMANCE IS AFTER ALL FEES. THE INDEX DOES NOT HAVE ANY FEES.
INVESTMENT RETURNS AND PRINCIPAL VALUE OF AN INVESTMENT WILL FLUCTUATE SO THAT
AN INVESTOR'S SHARES, WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR
ORIGINAL COST. TOTAL RETURN REPRESENTS PAST PERFORMANCE AND IS NOT PREDICTIVE OF
FUTURE RESULTS.
<TABLE>
<CAPTION>
PERFORMANCE
<S> <C> <C>
Six Month Total Return Since
Inception
2/29/00 - 8/31/00 12/20/00 -8/31/00
----------------- -----------------
MONTEAGLE OPPORTUNITY (34.44)% 12.10%
GROWTH FUND
S&P 500 Index 11.72% 10.23%
</TABLE>
Bears had the run of Wall Street for yet another quarter as investor concerns
about skyrocketing energy prices, rising interest rates, and global inflation
unsettled the markets.
The deflated "wealth effect," punctured by a collapsing stock market, where an
estimated 60% of U.S. households are investors, has signified possibly larger
problems for retailers as six interest rate increases, and the oil price surge
are beginning to curb spending.
By most estimates, according to the The Wall Street Journal, the economy is
"downshifting," and with it has come a flood of disappointing earnings
pre-announcements. Not to be caught napping in this clearly hostile earnings
environment, the NASDAQ composite index plunged 12.7% in September. It was the
worst September in this index's 29-year history as the market dismantled some of
the most visible names in corporate America -- a true-life "Ride of the
Valkyries".
It is becoming clearer to investors that the second-half boom forecast by most
analysts will not materialize. The debate, today, is whether the bull market is
over, or merely pausing, before it resumes growth at a more moderate pace. By
most estimates, technology stocks will continue to show the most consistent
earnings and revenue growth and will lead the market, even in a period of slower
economic growth. It is the direction of this leadership, up or down, that
remains to be seen.
As of October 31, 2000, the Monteagle Opportunity Growth Fund is hedged on that
question with about 12% of the portfolio held in technology stocks, 20% in
energy stocks, and 21% in drug/healthcare stocks. The Fund holds about 47% in
cash or cash equivalents.
Sincerely,
T.H. Fitzgerald, Jr.
MONTEAGLE VALUE FUND Fall 2000
DEAR SHAREHOLDER,
We are pleased to report a successful inaugural year ending August 31, 2000 for
the Monteagle Value Fund. In the past twelve months, the financial markets have
endured an extremely volatile period. Markets soared throughout 1999 and into
early 2000 before higher short-term interest rates halted the market's climb in
mid-March.
The Dow Jones Industrial Average and the NASDAQ have fallen 4.57% and 17.20%
respectively through October 31, 2000, yet the twelve-month returns remain
positive at +4.61% and 13.74% respectively. The markets reached the speculative
phase in 1999 and continued on that track until excess liquidity dried up in
March 2000.
Since its inception on December 20, 1999 registration date, the Monteagle Value
Fund's price has risen from $10.00 to its October 31, 2000 price of $11.93
returning +19.3% for that period of time. For the same period of time, the Dow
Jones Industrial Average and the NASDAQ are down 0.32% and 10.82% respectively.
The Fund currently trades at 14.62 times 2000 earnings and has an estimated
yield of 2.2%.
Date Russell 2000 Value Monteagle Value Fund
Index - $11,978 - $11,660
12/20/99 10,000.00 10,000.00
12/31/99 10,482.75 10,250.00
1/31/00 10,208.61 9,930.00
2/29/00 10,832.56 9,240.00
3/31/00 10,883.36 10,240.00
4/28/00 10,947.76 10,200.00
5/31/00 10,780.72 10,600.00
6/30/00 11,095.72 10,610.00
7/31/00 11,465.42 10,760.00
8/31/00 11,978.01 11,660.00
THIS GRAPH, PREPARED IN ACCORDANCE WITH SEC REGULATIONS, COMPARES A $10,000
INVESTMENT IN THE FUND WITH A SIMILAR INVESTMENT IN THE UNMANAGED RUSSELL 2000
VALUE INDEX ON DECEMBER 20, 1999 HELD THROUGH AUGUST 31, 2000. RESULTS FOR THE
FUND AND RUSSELL 2000 VALUE INDEX INCLUDE THE REINVESTMENT OF DIVIDEND AND
CAPITAL GAIN DISTRIBUTIONS IF ANY. THE FUND'S PERFORMANCE IS AFTER ALL FEES. THE
INDEX DOES NOT HAVE ANY FEES. INVESTMENT RETURNS AND PRINCIPAL VALUE OF AN
INVESTMENT WILL FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN REDEEMED, MAY BE
WORTH MORE OR LESS THAN THEIR ORIGINAL COST. TOTAL RETURN REPRESENTS PAST
PERFORMANCE AND IS NOT PREDICTIVE OF FUTURE RESULTS.
<TABLE>
<CAPTION>
PERFORMANCE
<S> <C> <C>
Six Month Total Return Since
Inception
2/29/00 - 8/31/00 12/20/00 -8/31/00
----------------- -----------------
MONTEAGLE VALUE FUND 26.19% 16.60%
Russell 2000 Value Index 10.57% 19.78%
</TABLE>
The Federal Reserve worked to reduce excess liquidity in the markets as monetary
growth slowed during the second and third quarter of 2000. Federal Reserve
Chairman Alan Greenspan remains biased toward tightening. Higher energy prices
and full employment are adding to the strain on the markets as inflationary
pressures reduce investment returns.
The leadership in the equity markets for 2000 is concentrated in defense
contractors, health care, savings and loans, natural gas, tobacco, hospital
management, investment banks, and energy exploration companies. Groups that have
significantly underperformed include containers, telecommunications, office
equipment, steel, household furnishings, photography, aluminum and paper and
forest products.
In the coming months, we believe the Federal Reserve will do what is necessary
to orchestrate an economic soft landing. We believe that the Monteagle Value
Fund is positioned to benefit from the current economic conditions and remain
committed to buying companies which trade below average market valuations based
on book values, price/earnings ratios and dividend yields.
In conclusion, the Monteagle Value Fund investment strategy remains to offer
investors a lower risk portfolio of stocks producing positive investment returns
over time.
Sincerely,
Russell L. Robinson
President
Robinson Investment Group
<PAGE>
<TABLE>
<CAPTION>
Monteagle Fixed Income Fund
Schedule of Investments - August 31, 2000
<S> <C> <C>
Principal
Amount Value
CORPORATE BONDS - 39.8%
Archer Daniels Midland Co. 8.125%, 06/01/2012 1,000,000 $ 1,043,263
Caterpillar, Inc. 9.375%, 08/18/2011 1,000,000 1,133,425
ChaseManhattan Corp. 7.875%, 07/15/2006 1,050,000 1,078,161
Cit Group Holdings, Inc. 6.625%, 06/15/2005 850,000 819,013
Commercial Credit 10.00%, 12/01/2008 1,000,000 1,150,764
Daimler Chrysler NA Holding 8.00%, 06/15/2010 500,000 513,404
Deutsche Telekom International 8.00%, 06/15/2010 1,000,000 1,014,283
Equifax, Inc. 6.50%, 06/15/2003 500,000 492,210
Lehman Brothers Holdings, Inc. 7.875%, 11/01/2009 600,000 601,513
Maytag Corp. 7.61%, 03/3/2003 250,000 248,967
MBIA, Inc. NT 9.375%, 02/15/2011 376,000 418,914
MCI Communications Corp. 7.50%, 08/20/2004 550,000 554,626
Merrill Lynch & Co. Inc. 8.00%, 06/01/2007 500,000 514,790
Monsanto Co. 8.875%, 12/15/2009 250,000 277,291
Morgan Stanley Dean Witter & Co. 8.00%, 06/15/2010 600,000 622,739
Norfolk Southern Corp. 7.750%, 08/15/2002 200,000 202,215
Vodafone Airtouch PLC 7.00%, 10/1/2003 500,000 495,474
Wal-Mart Stores, Inc. 6.875%, 08/10/2009 500,000 496,150
-----------------
-----------------
TOTAL CORPORATE BONDS (Cost $11,709,613) 11,677,202
-----------------
-----------------
MUNICIPAL OBLIGATIONS - 30.3%
Municipal Obligations (General) - 17.4%
Buffalo NY Pension Systems Services 8.50%, 08/15/2005 500,000 528,075
Delaware River Port Authority 7.50%, 01/01/2012 1,500,000 1,500,135
Los Angeles County CA Pension Obligation Series D 5.92%, 06/30/2007 1,100,000 1,082,323
Mississippi Street MS Farm Reform Act Series N & Ecomony
Development Highway Act Series F 6.20%, 09/01/2010 345,000 318,187
Morris TN 6.00%, 03/01/2007 410,000 384,449
NJ Sports & Expos 7.37%, 03/01/2007 500,000 505,235
Tulare County CA Pension Obligation 7.31%, 08/15/2010 800,000 799,944
-----------------
-----------------
5,118,348
-----------------
-----------------
Monteagle Fixed Income Fund
Schedule of Investments - August 31, 2000 - continued
Principal
Amount Value
MUNICIPAL OBLIGATIONS - continued
Municipal Obligations (Revenue) - 12.9%
Atlanta & Fulton County GA Recreation Authority Downtown
Arena project 6.625%, 12/01/2011 300,000 $ 283,734
Detroit MI Downtown Development Authority 6.30%, 0701/2010 500,000 464,985
Harris County Houston Texas Sports Authority 6.15%, 11/15/2008 300,000 279,843
LaGrange, GA Development Authority 6.10%, 02/01/2010 750,000 688,995
New York City, NY Transportation Finance Authority
6.25%, 05/01/2009 700,000 654,220
New York Street Environmental Facilities Corp. 6.66%, 03/15/2007 950,000 922,678
New York Street Mortgage Agency 6.70%, 10/01/2004 500,000 493,540
-----------------
-----------------
3,787,995
-----------------
-----------------
TOTAL MUNICIPAL OBLIGATIONS ( Cost $9,312,794) 8,906,343
-----------------
-----------------
U.S. TREASURY AND AGENCY OBLIGATIONS - 27.1%
Federal Home Loan Bank 7.46%, 08/24/2006 500,000 496,955
Federal Home Loan Bank 6.120%, 08/26/2008 500,000 469,148
Federal Home Loan Bank 7.00%, 03/15/2010 450,000 453,918
Federal National Mortgage Association 6.04%, 02/25/2009 1,000,000 927,227
Federal National Mortgage Association 6.58%, 12/17/2007 1,200,000 1,161,713
Federal National Mortgage Association 6.60%, 03/11/2009 850,000 817,004
Federal National Mortgage Association 6.56%, 11/26/2007 675,000 650,325
US Treasury Notes 7.25%, 05/15/2004 100,000 103,812
US Treasury Notes 7.25%, 08/15/2004 400,000 416,625
US Treasury Notes 6.50%, 02/15/2010 1,000,000 1,044,063
US Treasury Notes 5.625%, 05/15/2008 1,275,000 1,250,297
US Treasury Notes 5.50%, 05/15/2009 150,000 145,828
-----------------
-----------------
TOTAL U.S. TREASURY & AGENCY OBLIGATIONS (Cost $8,133,003) 7,936,915
-----------------
-----------------
Principal
Amount Value
Money Market Securities - 1.7%
Firstar Treasury Fund, 5.53% (a) (Cost $501,094) 501,094 501,094
-----------------
-----------------
TOTAL INVESTMENTS - 98.9% (Cost $29,656,504) 29,021,554
-----------------
-----------------
Other assets less liabilities - 1.1% 324,387
-----------------
-----------------
TOTAL NET ASSETS - 100.0% $ 29,345,941
=================
=================
(a) Floating rate security; the coupon rate shown represents the rate at August 31, 2000.
</TABLE>
<TABLE>
<PAGE>
<CAPTION>
<S> <C> <C>
Monteagle Fixed Income Fund August 31, 2000
Statement of Assets & Liabilities
Assets
Investment in securities (cost $29,656,504) $ 29,021,554
Receivable for fund shares sold 54,665
Interest receivable 431,999
-------------------
Total assets 29,508,218
Liabilities
Accrued investment advisory fee $ 28,431
Dividends payable 133,846
-----------------
Total liabilities 162,277
-------------------
Net Assets $ 29,345,941
===================
Net Assets consist of:
Paid in capital $ 30,288,043
Accumulated net realized loss on investments (307,152)
Net unrealized depreciation on investments (634,950)
-------------------
Net Assets, for 2,915,703 shares $ 29,345,941
===================
Net Assets
Offering price and redemption price per share ($29,345,941 / 2,915,703) $ 10.06
===================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Monteagle Fixed Income Fund
Statement of Operations for the period December 20, 1999
(Commencement of Operations) to August 31, 2000
<S> <C> <C>
Investment Income
Interest income $ 1,053,983
------------------
Total Income 1,053,983
Expenses
Investment advisory fee $ 235,276
Trustees' fees 850
------------------
Total operating expenses 236,126
------------------
Net Investment Income 817,857
------------------
Realized & Unrealized Gain (Loss)
Net realized loss on investment securities (307,152)
Change in net unrealized appreciation
on investment securities 793,704
------------------
Net gain on investment securities 486,552
------------------
Net increase in net assets resulting from operations $ 1,304,409
==================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Monteagle Fixed Income Fund
Statement of Changes in Net Assets for the period December 20, 1999
(Commencement of Operations) to August 31, 2000
<S> <C>
Increase (Decrease) in Net Assets
Operations
Net investment income $ 817,857
Net realized loss on investment securities (307,152)
Change in net unrealized appreciation 793,704
-----------------
-----------------
Net increase in net assets resulting from operations 1,304,409
-----------------
Distributions to shareholders
From net investment income (1,131,991)
From net realized gain -
-----------------
Total distributions (1,131,991)
-----------------
Share Transactions
Net proceeds from sale of shares 31,244,919
Shares issued in reinvestment of distributions 48,153
Shares redeemed (2,119,549)
-----------------
Net increase in net assets resulting
from share transactions 29,173,523
-----------------
-----------------
Total increase in net assets 29,345,941
-----------------
Net Assets
Beginning of period -
-----------------
End of period [including accumulated undistributed net
investment income of $0] $ 29,345,941
=================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Monteagle Fixed Income Fund
Financial Highlights for the period December 20, 1999
(Commencement of Operations) to August 31, 2000
<S> <C>
Selected Per Share Data
Net asset value, beginning of period $ 10.00
--------------
Income from investment operations
Net investment income 0.28
Net realized and unrealized gain 0.16
--------------
Total from investment operations 0.44
--------------
Less Distributions
From net investment income (0.38)
--------------
Total distributions (0.38)
--------------
Net asset value, end of period $ 10.06
==============
Total Return (a) 4.54%
Ratios and Supplemental Data
Net assets, end of period (000) $ 29,346
Ratio of expenses to average net assets 1.15% (b)
Ratio of net investment income to
average net assets 3.97% (b)
Portfolio turnover rate 58.87% (b)
(a) For periods of less than a full year, total return is not annualized.
(b) Annualized
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Monteagle Large Cap Fund
Schedule of Investments - August 31, 2000
<S> <C> <C>
Common Stocks - 92.1% Shares Value
Cement, Hydraulic - 4.0%
Southdown, Inc. 8,270 $ 518,943
-----------------
-----------------
Computer Communication Equipment - 4.3%
Cisco Systems, Inc. (a) 8,050 552,431
-----------------
-----------------
Computers & Office Equipment - 4.9%
Hewlett Packard Co. 5,170 624,278
-----------------
-----------------
Construction, Mining & Materials Handling - 4.0%
Dover Corp. 10,600 518,075
-----------------
-----------------
Diversified - Manufacturing - 4.7%
Tyco International, Ltd. 10,550 601,350
-----------------
-----------------
Drug - Wholesale - 4.3%
Cardinal Health, Inc. 6,740 551,416
-----------------
-----------------
Insurance - 8.0%
American International Group, Inc. 6,600 588,225
MGIC Investment Corp. 7,330 431,096
-----------------
-----------------
1,019,321
-----------------
-----------------
National Commercial Banks - 4.7%
Citigroup, Inc. 10,267 599,317
-----------------
-----------------
Perfumes, Cosmetics & Other Toilet Preparations - 3.4%
Colgate-Palmolive Co. 8,650 440,609
-----------------
-----------------
Petroleum Refining - 3.8%
Shell Transportation & Trading Co. PLC (c) 9,590 493,286
-----------------
-----------------
Pharmaceutical Preparations - 9.3%
Elan Corp. PLC (a) (c) 11,020 642,604
Johnson & Johnson 5,930 545,189
-----------------
-----------------
1,187,793
-----------------
-----------------
Retail - Lumber & Other Building Materials Dealers - 2.8%
Home Depot, Inc. 7,360 353,740
-----------------
-----------------
Retail - Variety Stores - 3.8%
Dollar Tree Stores, Inc. (a) 12,150 492,834
-----------------
-----------------
Semiconductors - 4.0%
Fairchild Semiconductor International, Inc. (a) 12,750 506,813
-----------------
-----------------
Services-Computer Integrated Systems Design - 4.7%
General Electric, Inc. 10,300 604,481
-----------------
-----------------
Monteagle Large Cap Fund
Schedule of Investments - August 31, 2000 - continued
Common Stocks - continued Shares Value
Services-Computer Processing & Data Preparations - 4.0%
First Data Corp. 10,600 $ 505,488
-----------------
-----------------
Services-Engineering, Accounting, Research - 4.0%
Paychex, Inc. 11,350 506,494
-----------------
-----------------
Specialty Industry Machinery - 4.6%
Applied Materials, Inc. (a) 6,870 592,966
-----------------
-----------------
Telephone & Telegraph Apparatus - 6.8%
ADC Telecommunications, Inc. (a) 12,240 501,075
Polycom, Inc. (a) 3,300 370,837
-----------------
-----------------
871,912
-----------------
-----------------
Telephone Communications (No Radio Telephone) - 2.0%
Verizon Communications 6,020 262,622
-----------------
-----------------
TOTAL COMMON STOCKS (Cost $10,915,633 ) 11,804,169
-----------------
-----------------
Principal
Amount Value
Money Market Securities - 7.7%
Firstar Treasury Fund, 5.53% (b) (Cost $994,729) 994,729 994,729
-----------------
-----------------
TOTAL INVESTMENTS - 99.8% (Cost $11,910,362) 12,798,898
-----------------
-----------------
Other assets less liabilities - 0.2% 20,893
-----------------
-----------------
Total Net Assets - 100.0% $ 12,819,791
=================
(a) Non-Income Producing
(b) Variable rate security; the coupon rate shown represents the rate at August 31, 2000.
(c) American Depository Receipt
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Monteagle Large Cap Fund August 31, 2000
Statement of Assests & Liabilities for the period January 18, 2000
(Commencement of Operations) to August 31, 2000
<S> <C> <C>
Assets
Investment in securities (cost $11,910,362) $ 12,798,898
Interest receivable 4,820
Dividends receivable 8,537
Receivable for fund shares sold 20,438
------------------
Total assets 12,832,693
Liabilities
Accrued investment advisory fee $ 12,902
-----------------
Total liabilities 12,902
------------------
Net Assets $ 12,819,791
==================
Net Assets consist of:
Paid in capital $ 12,397,674
Accumulated undistributed net investment income 3,613
Accumulated net realized loss on investments (470,032)
Net unrealized appreciation on investments 888,536
------------------
Net Assets, for 1,292,935 shares $ 12,819,791
==================
Net Assets
Offering price and redemption price per share ($ 12,819,791 / 1,292,935) $ 9.92
==================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Monteagle Large Cap Fund
Statement of Operations for the period January 18, 2000
(Commencement of Operations) to August 31, 2000
<S> <C> <C>
Investment Income
Dividend income $ 32,992
Interest income 18,511
---------------
Total Income 51,503
Expenses
Investment advisory fee $ 47,040
Trustees' Fee 850
------------------
Total operating expenses 47,890
---------------
Net Investment Income 3,613
Realized & Unrealized Gain (Loss)
Net realized loss on investment securities (470,032)
Change in net unrealized appreciation
on investment securities 888,536
------------------
Net gain on investment securities 418,504
---------------
Net increase in net assets resulting from operations $ 422,117
===============
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Monteagle Large Cap Fund
Statement of Changes in Net Assets for the period January 18, 2000
(Commencement of Operations) to August 31, 2000
<S> <C>
Increase (Decrease) in Net Assets
Operations
Net investment income $ 3,613
Net realized loss on investment securities (470,032)
Change in net unrealized appreciation 888,536
-----------------
-----------------
Net increase in net assets resulting from operations 422,117
-----------------
Distributions to shareholders
From net investment income 0
From net realized gain 0
-----------------
-----------------
Total distributions 0
-----------------
Share Transactions
Net proceeds from sale of shares 12,609,433
Shares issued in reinvestment of distributions 0
Shares redeemed (211,759)
-----------------
Net increase in net assets resulting
from share transactions 12,397,674
-----------------
-----------------
Total increase in net assets 12,819,791
-----------------
Net Assets
Beginning of period 0
-----------------
End of period [including accumulated undistributed net
investment income of $3,613] $ 12,819,791
=================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Monteagle Large Cap Fund
Financial Highlights for the period January 18, 2000
(Commencement of Operations) to August 31, 2000
<S> <C>
Selected Per Share Data
Net asset value, beginning of period $ 10.00
--------------
Income from investment operations
Net investment income (loss) 0.01
Net realized and unrealized gain (loss) (0.09)
--------------
Total from investment operations (0.08)
--------------
Less Distributions
From net investment income 0.00
From realized gain 0.00
--------------
--------------
Total distributions 0.00
--------------
Net asset value, end of period $ 9.92
==============
Total Return (0.80)% (a)
Ratios and Supplemental Data
Net assets, end of period (000) 12,820
Ratio of expenses to average net assets 1.27% (b)
Ratio of net investment income to
average net assets 0.10% (b)
Portfolio turnover rate 68.00% (b)
(a) For a period of less than a full year, total return is not annualized.
(b) Annualized
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Monteagle Opportunity Growth Fund
Schedule of Investments - August 31, 2000
<S> <C> <C>
Common Stocks - 91.1% Shares Value
Cogeneration Services & Small Power Products - 3.1%
Calpine Corp. (a) 23,100 $ 2,286,900
------------------
------------------
Communications Equipment - 10.0%
Extreme Networks, Inc. (a) 30,400 2,829,100
Juniper Networks, Inc. (a) 15,700 3,355,875
MRV Communications, Inc. (a) 17,500 1,348,593
------------------
------------------
7,533,568
------------------
------------------
Electronic Components, NEC - 5.5%
Power-One, Inc. (a) 26,200 4,151,063
------------------
------------------
Electronic Computers - 1.4%
Sun Microsystems, Inc. (a) 8,200 1,040,888
------------------
------------------
Glass, Glassware, Pressed or Blown - 3.4%
Corning, Inc. 7,800 2,557,913
------------------
------------------
Laboratory Analytical Instruments - 4.0%
Newport Corp. 18,200 2,893,800
------------------
------------------
Oil and Natural Gas - 2.8%
Anadarko Petroleum Corp. 32,400 2,130,948
------------------
------------------
Pharmaceutical Preparations - 1.3%
Barr Laboratories, Inc. (a) 13,600 965,600
------------------
------------------
Printed Circuit Boards - 10.0%
Sanmina Corp. (a) 35,600 4,200,800
Plexus Corp. (a) 21,500 3,327,125
------------------
------------------
7,527,925
------------------
------------------
Semiconductors - 24.4%
PMC Sierra, Inc. (a) 7,300 1,722,800
Applied Micro Circuits Corp. (a) 16,900 3,429,643
Broadcom Corp. (a) 16,900 4,225,000
Integrated Devise Technology, Inc. (a) 23,300 2,044,575
SDL, Inc. (a) 7,000 2,781,188
Semtech Corp. (a) 8,700 1,030,406
JDS Uniphase Corp. (a) 25,000 3,112,109
------------------
------------------
18,345,721
------------------
------------------
Services - Business Services, NEC - 3.5%
Redback Networks, Inc. (a) 17,700 2,643,938
------------------
------------------
Services-Commercial Physical & Biological Research - 4.1%
Celgene Corp. (a) 20,000 1,480,000
Quest Diagnostics, Inc. (a) 12,800 1,584,000
------------------
------------------
3,064,000
------------------
------------------
Monteagle Opportunity Growth Fund
Schedule of Investments - August 31, 2000 - continued
Common Stocks - continued Shares Value
Services - Medical Laboratories - 3.7%
Laboratory Corp. of American Holdings (a) 23,600 $ 2,792,175
------------------
------------------
Services-Prepackaged Software - 7.6%
Brocade Communications Systems, Inc. (a) 10,400 2,348,450
Check Point Software Technologies Ltd. (a) 11,200 1,633,100
Siebel Systems, Inc. (a) 8,900 1,760,531
------------------
------------------
5,742,081
------------------
------------------
Telephone & Telegraph Apparatus - 6.3%
ADC Telecommunications, Inc. (a) 81,400 3,332,312
Nortel Networks Corp. 17,400 1,419,188
------------------
------------------
4,751,500
------------------
------------------
TOTAL COMMON STOCKS (Cost $53,301,410) 68,428,020
------------------
------------------
Principal
Amount
Money Market Securities - 11.5 %
Firstar Treasury Fund, 5.53% (b) (Cost $8,637,824) 8,637,824 8,637,824
------------------
------------------
TOTAL INVESTMENTS - 102.6% (Cost $61,939,234) 77,065,844
------------------
------------------
Liabilities in excess of other assets - (2.6%) (1,964,149)
------------------
------------------
Total Net Assets - 100.0% $ 75,101,695
==================
(a) Non-income producing
(b) Variable rate security; the coupon rate shown represents the rate at August 31, 2000.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
Monteagle Opportunity Growth Fund August 31, 2000
Statement of Assets & Liabilities
Assets
Investment in securities (cost $61,939,234) $ 77,065,844
Receivable for fund shares sold 2,413,445
Dividends receivable 1,730
Interest receivable 71,723
------------------
Total assets 79,552,742
Liabilities
Accrued investment advisory fee $ 72,248
Payable for investments purchased 4,378,799
-----------------
Total liabilities 4,451,047
------------------
Net Assets $ 75,101,695
==================
Net Assets consist of:
Paid in capital $ 43,001,812
Accumulated net realized gain on investments 16,973,273
Net unrealized appreciation on investments 15,126,610
------------------
Net Assets, for 6,701,952 shares $ 75,101,695
==================
Net Assets
Offering price and redemption price per share ($75,101,695/6,701,952) $ 11.21
==================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Monteagle Opportunity Growth Fund
Statement of Operations for the period December 20, 1999
(Commencement of Operations) to August 31, 2000
<S> <C> <C>
Investment Income
Dividend income $ 7,880
Interest income 403,929
-----------------
Total Income 411,809
Expenses
Investment advisory fee $ 710,649
Trustees' fees 850
------------------
Total operating expenses 711,499
-----------------
Net Investment Loss (299,690)
-----------------
Realized & Unrealized Gain (Loss)
Net realized gain on investment securities 17,272,963
Change in net unrealized depreciation
on investment securities (7,919,048)
------------------
Net gain on investment securities 9,353,915
-----------------
Net increase in net assets resulting from operations $ 9,054,225
=================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Monteagle Opportunity Growth Fund
Statement of Changes in Net Assets for the period December 20, 1999
(Commencement of Operations) to August 31, 2000
<S> <C>
Increase (Decrease) in Net Assets
Operations
Net investment loss $ (299,690)
Net realized gain on investment securities 17,272,963
Change in net unrealized depreciation (7,919,048)
-------------------
-------------------
Net increase in net assets resulting from operations 9,054,225
-------------------
Distributions to shareholders
From net investment income 0
From net realized gain 0
-------------------
-------------------
Total distributions 0
-------------------
Share Transactions
Net proceeds from sale of shares 87,385,790
Shares issued in reinvestment of distributions 0
Shares redeemed (21,338,320)
-------------------
Net increase in net assets resulting
from share transactions 66,047,470
-------------------
-------------------
Total increase in net assets 75,101,695
-------------------
Net Assets
Beginning of period 0
-------------------
End of period [including undistributed accumulated net
investment income of $0] $ 75,101,695
===================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Monteagle Opportunity Growth Fund
Financial Highlights for the period December 20, 1999
(Commencement of Operations) to August 31, 2000
<S> <C>
Selected Per Share Data
Net asset value, beginning of period $ 10.00
--------------
Income from investment operations
Net investment loss (0.04)
Net realized and unrealized gain 1.25
--------------
--------------
Total from investment operations 1.21
--------------
Less Distributions
From net investment income 0
From net realized gain 0
--------------
--------------
Total Distributions 0
--------------
Net asset value, end of period $ 11.21
==============
Total Return (a) 12.10%
Ratios and Supplemental Data
Net assets, end of period (000) $ 75,102
Ratio of expenses to average net assets 1.27% (b)
Ratio of net investment income to
average net assets (0.53)% (b)
Portfolio turnover rate 605.41% (b)
(a) For period of less than a full year, total return is not annualized.
(b) Annualized
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Monteagle Value Fund
Schedule of Investments - August 31, 2000
<S> <C> <C>
Common Stocks - 95.7% Shares Value
Aeronautical Systems - 2.8%
Litton Industries, Inc. (a) 10,000 $ 553,125
-----------------
-----------------
Air Transportation Scheduled - 3.8%
AMR Corp. Delaware (a) 8,000 262,500
Delta Airlines, Inc. 10,000 495,000
-----------------
-----------------
757,500
-----------------
-----------------
Aircraft - 2.6%
Northrop Grumman Corp. 6,500 505,781
-----------------
-----------------
Asset Backed Securities - 6.3%
Amsouth Bancorp. 21,000 383,250
Bank of America Corp. 16,225 869,052
-----------------
-----------------
1,252,302
-----------------
-----------------
Auto Controls For Regulating Residential - 2.7%
Honeywell International, Inc. 13,700 528,306
-----------------
-----------------
Chemicals - 4.7%
Dow Chemical Co. 15,000 392,813
Great Lakes Chemical Corp. 5,000 168,750
ICN Pharmaceuticals, Inc. 13,000 368,062
-----------------
-----------------
929,625
-----------------
-----------------
Communications Equipment - 1.8%
Motorola, Inc. 10,000 360,625
-----------------
-----------------
Consumer Products - 4.5%
Nashua Corp. 40,000 325,000
Procter & Gamble Co. 9,000 556,312
-----------------
-----------------
881,312
-----------------
-----------------
Depository Banking - 3.3%
Concord EFS, Inc. (a) 20,500 658,563
-----------------
-----------------
Electric Services - 5.7%
TXU Corp. 12,000 419,250
Western Resources, Inc. 35,000 700,000
-----------------
-----------------
1,119,250
-----------------
-----------------
Engines & Turbines - 1.6%
McDermott International, Inc. 40,000 307,500
-----------------
-----------------
Financial Services - 3.5%
Raymond James Financial, Inc. 24,500 698,250
-----------------
-----------------
Health Products & Services - 3.3%
Quorum Health Group, Inc. (a) 51,000 656,625
-----------------
-----------------
Monteagle Value Fund
Schedule of Investments - August 31, 2000 - continued
Common Stocks - continued Shares Value
Industrial Instruments - 1.9%
Rockwell International Corp. 9,400 $ 380,112
-----------------
-----------------
Insurance - 4.4%
Safeco Corp. 18,000 473,625
Torchmark Corp. 14,000 392,875
-----------------
-----------------
866,500
-----------------
-----------------
Motor Vehicles - 3.7%
General Motors Corp. 10,000 721,875
-----------------
-----------------
National Commercial Banks - 9.6%
Bank One Corp. 8,000 282,000
First Tennessee National Corp. 27,100 596,200
First Union Corp. 15,200 439,850
Regions Financial Corp. 26,700 580,725
-----------------
-----------------
1,898,775
-----------------
-----------------
Oil & Gas Filed Machinery & Equipment - 1.1%
Friede Goldman Halter, Inc. (a) 40,000 225,000
-----------------
-----------------
Pharmaceutical Preparations - 2.0%
Bristol-Myers Squibb, Inc. 7,500 397,500
-----------------
-----------------
Photographic Equipment & Supplies - 1.9%
Xerox Corp. 23,000 369,438
-----------------
-----------------
Publishing or Printing - 1.7%
Knight Ridder, Inc. 6,300 344,138
-----------------
-----------------
Railroads, Line Haul Operating - 3.7%
CSX Corp. 30,500 728,188
-----------------
-----------------
Retail - Department Stores - 1.0%
Saks, Inc. (a) 19,000 190,000
-----------------
-----------------
Retail-Drug Stores & Proprietary Stores - 1.0%
Rite Aid Corp. (a) 48,000 192,000
-----------------
-----------------
Security Brokers, Dealers & Flotation Companies - 2.6%
Knight Trading Group, Inc. (a) 16,000 502,000
-----------------
-----------------
Monteagle Value Fund
Schedule of Investments - August 31, 2000 - continued
Common Stocks - continued Shares Value
State Commercial Banks - 4.0%
Summit Bancorp. 15,000 $ 415,312
SunTrust Banks, Inc. 7,500 370,312
-----------------
-----------------
785,624
-----------------
-----------------
Surgical & Medical Instruments & Apparatus - 2.3%
Becton Dickinson & Co. 15,000 451,875
-----------------
-----------------
Telephone Communications (No Radio Telephone) - 5.7%
AT&T Corp. 16,300 513,450
Lucent Technologies, Inc. 1,000 41,813
Verizon Communications 13,000 567,125
-----------------
-----------------
1,122,388
-----------------
-----------------
Water Supply - 2.5%
American Water Works, Inc. 20,500 502,250
-----------------
-----------------
TOTAL COMMON STOCKS (Cost $18,618,368) 18,886,427
-----------------
-----------------
Principal
Amount
Money Market Securities - 4.1%
Firstar Treasury Fund, 5.53% (b) (Cost $801,731) 801,731 801,731
-----------------
-----------------
TOTAL INVESTMENTS - 99.8% (Cost $19,420,099) 19,688,158
-----------------
-----------------
Other assets less liabilities - 0.2% 46,049
-----------------
-----------------
Total Net Assets - 100.0% $ 19,734,207
=================
(a) Non-income producing
(b) Variable rate security; the coupon rate shown represents the rate at August 31, 2000.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
Monteagle Value Fund August 31, 2000
Statement of Assets & Liabilities
Assets
Investment in securities (cost $19,420,099) $ 19,688,158
Cash 6,523
Dividends receivable 43,636
Interest receivable 7,187
Receivable for fund shares sold 11,000
------------------
Total assets 19,756,504
Liabilities
Accrued investment advisory fee $ 22,297
-----------------
Total liabilities 22,297
------------------
Net Assets $ 19,734,207
==================
Net Assets consist of:
Paid in capital $ 18,985,790
Accumulated undistributed net investment income 98,396
Accumulated net realized gain on investments 381,962
Net unrealized appreciation on investments 268,059
------------------
Net Assets, for 1,693,196 shares $ 19,734,207
==================
Net Assets
Offering price and redemption price per share ($19,734,207 / 1,693,196) $ 11.66
==================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Monteagle Value Fund
Statement of Operations for the period December 20, 1999
(Commencement of Operations) to August 31, 2000
<S> <C> <C>
Investment Income
Dividend income $ 229,957
Interest income 41,283
----------------
Total Income 271,240
Expenses
Investment advisory fee $ 171,994
Trustee's fees 850
------------------
Total operating expenses 172,844
----------------
Net Investment Income 98,396
----------------
Realized & Unrealized Gain (Loss)
Net realized gain on investment securities 381,962
Change in net unrealized appreciation
on investment securities 2,411,473
------------------
Net gain on investment securities 2,793,435
----------------
Net increase in net assets resulting from operations $ 2,891,831
================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Monteagle Value Fund
Statement of Changes in Net Assets for the period December 20, 1999
(Commencement of Operations) to August 31, 2000
<S> <C>
Increase (Decrease) in Net Assets
Operations
Net investment income $ 98,396
Net realized gain on investment securities 381,962
Change in net unrealized appreciation 2,411,473
-----------------
Net increase in net assets resulting from operations 2,891,831
-----------------
Distributions to shareholders
From net investment income 0
From net realized gain 0
-----------------
Total distributions 0
-----------------
Share Transactions 0
Net proceeds from sale of shares 18,835,833
Shares issued in reinvestment of distributions 0
Shares redeemed (1,993,457)
-----------------
Net increase in net assets resulting
from share transactions 16,842,376
-----------------
Total increase in net assets 19,734,207
-----------------
Net Assets
Beginning of period 0
-----------------
End of period [including accumulated undistributed net
investment income of $98,396] $ 19,734,207
=================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Monteagle Value Fund
Financial Highlights for the period December 20, 1999
(Commencement of Operations) to August 31, 2000
<S> <C>
Selected Per Share Data
Net asset value, beginning of period $ 10.00
--------------
Income from investment operations
Net investment income 0.06
Net realized and unrealized gain 1.60
--------------
--------------
Total from investment operations 1.66
--------------
Less Distributions
From net investment income 0.00
From net realized gain 0.00
--------------
--------------
Total Distributions 0.00
--------------
Net asset value, end of period $ 11.66
==============
Total Return (a) 16.60%
Ratios and Supplemental Data
Net assets, end of period (000) $ 19,734
Ratio of expenses to average net assets 1.36% (b)
Ratio of net investment income to
average net assets 0.77% (b)
Portfolio turnover rate 375.67% (b)
(a) For periods of less than a full year, total return is not annualized.
(b) Annualized
</TABLE>
<PAGE>
MONTEAGLE FUNDS
NOTES TO FINANCIAL STATEMENTS
AUGUST 31, 2000
NOTE 1. ORGANIZATION
The Monteagle Fixed Income Fund, Monteagle Opportunity Growth Fund, Monteagle
Value Fund, and Monteagle Large Cap Fund (each a "Fund" or collectively, the
"Funds") were organized as series of AmeriPrime Advisers Trust (the "Trust") on
August 3, 1999. The Monteagle Fixed Income Fund, Monteagle Opportunity Growth
Fund, and Monteagle Value Fund, commenced operations on December 20, 1999, and
the Monteagle Large Cap Fund commenced operations on January 18, 2000. Prior to
December 20, 1999 the Monteagle Fixed Income, Monteagle Opportunity Growth, and
the Monteagle Value Funds were a collection of trusts at First Farmers &
Merchants National Bank. On December 20, 1999 these trusts transferred their
assets to the Monteagle Funds in a tax-free exchange where the trusts received
in return an amount of shares of the Funds equal to the market value of the
assets transferred to the Funds. The Funds retained the historical cost basis of
the securities that were transferred and as a result the Funds had unrealized
gains and losses on the securities that were transferred. The following table
represents components of net assets at December 20, 1999:
<TABLE>
<CAPTION>
<S> <C> <C>
FUND UNREALIZED PAID-IN CAPITAL
APPRECIATION/(DEPRECIATION)
Monteagle Fixed Income $ (1,428,654) $31,140,824
Monteagle Opportunity Growth $ 23,045,658 $46,689,282
Monteagle Value $ (2,143,415) $20,679,002
</TABLE>
The investment objective of the Monteagle Fixed Income Fund is total return and
the investment objective of the other Funds is to provide long-term growth of
capital. The Monteagle Opportunity Growth Fund is a non-diversified series of
the Trust. The Monteagle Fixed Income Fund, the Monteagle Large Cap Fund, and
the Monteagle Value Fund are diversified series of the Trust. The Trust is an
open-end investment company established under the laws of Ohio by an Agreement
and Declaration of Trust dated August 3, 1999 (the "Trust Agreement"). The Trust
Agreement permits the Trustees to issue an unlimited number of shares of
beneficial interest of separate series without par value. Each Fund is one of a
series of funds currently offered by the Trust.
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed by each
Fund in the preparation of its financial statements.
SECURITIES VALUATIONS- Securities, that are traded on any exchange or on the
NASDAQ over-the-counter market, are valued at the last quoted sale price.
Lacking a last sale price, a security is valued at its last bid price except
when, in the applicable adviser's opinion, the last bid price does not
accurately reflect the current value of the security. All other securities for
which over-the-counter market quotations are readily available are valued at
their last bid price. When market quotations are not readily available, when the
applicable adviser determines the last bid price does not accurately reflect the
current value or when restricted securities are being valued, such securities
are valued as determined in good faith by the applicable adviser, in conformity
with guidelines adopted by and subject to review of the Board of Trustees of the
Trust (the "Board").
Fixed-income securities generally are valued by using market quotations, but may
be valued on the basis of prices furnished by a pricing service when the
applicable adviser believes such prices accurately reflect the fair market value
of such securities. A pricing service utilizes electronic data processing
techniques based on yield spreads relating to securities with similar
characteristics to determine prices for normal institutional-size trading units
of debt securities without regard to sale or bid prices. When prices are not
readily available from a pricing service, or when restricted or illiquid
securities are being valued, securities are valued at fair value as determined
in good faith by the applicable adviser, subject to review of the Board.
Short-term investments in fixed-income securities with maturities of less than
60 days when acquired, or which subsequently are within 60 days of maturity, are
valued by using the amortized cost method of valuation, which the Board has
determined will represent fair value.
MONTEAGLE FUNDS
NOTES TO FINANCIAL STATEMENTS
AUGUST 31, 2000 - CONTINUE
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
FEDERAL INCOME TAXES- Each Fund intends to qualify each year as a "regulated
investment company" under the Internal Revenue Code of 1986, as amended. By so
qualifying, each Fund will not be subject to federal income taxes to the extent
that it distributes substantially all of its net investment income and any
realized capital gains.
DIVIDENDS AND DISTRIBUTIONS- Each Fund intends to distribute substantially all
of its net investment income as dividends to its shareholders on at least an
annual basis. Each Fund intends to distribute its net long-term capital gains
and its net short-term capital gains at least once a year.
OTHER- Each Fund follows industry practice and records security transactions on
the trade date. The specific identification method is used for determining gains
or losses for financial statements and income tax purposes. Dividend income is
recorded on the ex-dividend date and interest income is recorded on an accrual
basis. Generally accepted accounting principles require that permanent financial
reporting tax differences relating to shareholder distributions be reclassified
to net realized gains for the Opportunity Growth Fund, and to paid-in capital
for the Fixed Income Fund.
NOTE 3. CHANGE IN ACCOUNTING PRINCIPLE
Fixed income securities normally will be amortized/accreted over the respective
life of the securities. Long-term debt securities that were transferred-in-kind
and used as the basis for the initial subscription into the Fixed Income Fund
had not been amortized/accreted from their initial purchase date. As a result,
the Fixed Income Fund has made amortization and accretion adjustments
accordingly. The cumulative effect of this accounting change had no impact on
total net assets of the Fixed Income Fund, but resulted in a $317,154 reduction
in cost of securities and a corresponding $317,154 decrease in net unrealized
depreciation, based on securities transferred into the Fund on December 20,
1999.
The effect of the change for the period ended August 31, 2000 was to decrease
net investment income by $317,154, resulting in a reclassification to paid-in
capital for the Fixed Income Fund.
NOTE 4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES
Nashville Capital Corporation, 209 10th Avenue South, Suite 332, Nashville TN
37203, serves as investment manager to the Funds. In this capacity, Nashville
Capital Corporation advises and assists the officers of the Trust in conducting
the business of the Fund and is responsible for providing general investment
advice and guidance to the Funds, although the investment manager has delegated
responsibility for the selection and ongoing monitoring of the securities in
each Fund's investment portfolio to the Fund's respective applicable adviser set
forth below. Nashville Capital Corporation was formed in 1986 and, as of
September 30, 1999, managed assets of approximately $98 million for financial
institutions. Each Fund is authorized to pay the investment manager a fee based
on average daily net assets at the following rates:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Assets Opportunity Growth Value Fixed Income Large Cap
------ ------------------ ----- ------------ ---------
Up to and
including $25 million 1.35% 1.35% 1.15% 1.25%
From $25 up to and
including $50 million 1.30% 1.25% 1.10% 1.13%
From $50 up to and
Over $100 million 1.10% 1.00% 0.90% 0.95%
</TABLE>
MONTEAGLE FUNDS
NOTES TO FINANCIAL STATEMENTS
AUGUST 31, 2000 - CONTINUE
NOTE 4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - CONTINUED
Under the terms of each Fund's management agreement (the "Agreement"), the
investment manager manages each Fund's investments subject to approval of the
Board of Trustees and pays all of the expenses of each Fund except brokerage
commissions, taxes, borrowing costs, fees and expenses of non-interested person
trustees, 12b-1 expenses and extraordinary expenses. It should be noted that
most investment companies pay their own operating expenses directly, while the
Funds' expenses, except those specified above, are paid by the investment
manager. For the period December 20, 1999 (commencement of operations of the
Fixed Income, Opportunity Growth, and Value Funds) through August 31, 2000, the
investment manager received fees of $235,276, $710,649, and $171,994 from the
Fixed Income, Opportunity Growth, and Value Funds, respectively. For the period
January 18, 2000 (commencement of operations of the Large Cap Fund) through
August 31, 2000, the investment manager received a fee of $47,040 from the Large
Cap Fund.
LARGE CAP FUND AND FIXED INCOME FUND. The investment manager has retained Howe
and Rusling, Inc. to serve as the adviser to the Large Cap Fund and the Fixed
Income Fund. The firm was established in 1930. The Howe and Rusling Investment
Committee are primarily responsible for the day-to-day management of the Funds.
Nashville Capital Corporation has agreed to pay Howe and Rusling an annual
advisory fee for the Large Cap Fund of 0.40% of net assets up to $25 million,
0.30% of net assets from $25 million up to $50 million, and 0.25% of net assets
of $50 million and greater. Nashville Capital Corporation has agreed to pay Howe
and Rusling an annual advisory fee for the Fixed Income Fund of 0.30% of net
assets up to $25 million, 0.25% of net assets from $25 million up to $50
million, and 0.20% of net assets of $50 million and greater.
For the period December 20, 1999 (commencement of operations of the Fixed Income
Fund) through August 31, 2000, the adviser received a fee of $60,228 from
Nashville Capital Corporation for the Fixed Income Fund. For the period January
18, 2000 (commencement of operations of the Large Cap Fund) through August 31,
2000, the adviser received a fee of $15,054 from Nashville Capital Corporation
for the Large Cap Fund.
OPPORTUNITY GROWTH FUND The investment manager has retained T.H. Fitzgerald, Jr.
(d/b/a T.H. Fitzgerald & Co.) to serve as the adviser to the Opportunity Growth
Fund. The firm has been owner-managed since it's founding in 1959. Mr.
Fitzgerald is primarily responsible for the day-to-day management of the Fund.
Nashville Capital has agreed to pay T.H. Fitzgerald & Co. an annual advisory fee
equal to 0.70% of net assets up to $25 million, 0.60% of net assets from $25
million up to $50 million, and 0.45% of net assets from $50 million up to $100
million, and 0.40% of net assets of $100 million and greater. For the period
December 20, 1999 (commencement of operations of the Opportunity Growth Fund)
through August 31, 2000, the adviser received a fee of $321,945 from Nashville
Capital Corporation for the Opportunity Growth Fund.
VALUE FUND. The investment manager has retained Robinson Investment Group, Inc.
to serve as the adviser to the Value Fund. Russell L. Robinson founded the firm
in 1996. Mr. Russell is primarily responsible for the day-to-day management of
the Value Fund. Nashville Capital has agreed to pay Russell Investment Group an
annual advisory fee of 0.60% of net assets up to $25 million, 0.45% of net
assets from $25 million up to $50 million, 0.35% of net assets from $50 million
up to $100 million, and 0.30% of net assets of $100 million and greater. For the
period December 20, 1999 (commencement of operations of the Value Fund) through
August 31, 2000, the adviser received a fee of $76,442 from Nashville Capital
Corporation for the Value Fund.
MONTEAGLE FUNDS
NOTES TO FINANCIAL STATEMENTS
AUGUST 31, 2000 - CONTINUED
NOTE 4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - CONTINUED
Each Fund retains AmeriPrime Financial Services, Inc. ("the Administrator"), a
wholly owned subsidiary of Unified Financial Services, Inc., to manage each
Fund's business affairs and to provide each Fund with administrative services
including all regulatory reporting and necessary office equipment and personnel.
The Administrator receives a monthly fee from Nashville Capital Corporation
equal to an annual average rate of 0.10% of each Fund's average daily net assets
up to $50 million dollars, 0.075% of each Fund's average daily net assets from
$50 million to $100 million dollars and 0.050% of each fund's average daily net
assets over $100 million dollars. For the period December 20, 1999 (commencement
of operations of Fixed Income, Opportunity Growth, and Value Funds) through
August 31, 2000, the Administrator received fees of $20,651, $56,182, and
$12,812 from Nashville Capital Corporation for administrative services provided
to the Fixed Income, Opportunity Growth, Value Funds, respectively. For the
period January 18, 2000 (commencement of operations of Large Cap Fund through
August 31, 2000, the Administrator received fees of $3,888 from Nashville
Capital Corporation for administrative services provided to the Large Cap Fund.
Each Fund retains AmeriPrime Financial Securities, Inc. (the "Distributor") to
act as the principal distributor of each Fund's shares. There were no payments
made to the Distributor for the period December 20, 1999 (commencement of
operations) through August 31, 2000 for the Fixed Income, Opportunity Growth,
and Value Funds, respectively. There were no payments made to the Distributor
for the period January 18, 2000 (commencement of operations) through August 31,
2000 for the Large Cap Fund. Certain members of management of the Administrator
and the Distributor are also members of management of the AmeriPrime Trust.
Each Fund retains Unified Fund Services, Inc. ("Unified"), 431 North
Pennsylvania Street, Indianapolis, Indiana 43204, and acts as each Fund's
transfer agent and, in such capacity, maintains the records of each
shareholder's account answers shareholders inquiries concerning their accounts,
processes purchases and redemptions of each Fund's shares, acts as dividend and
distribution disbursing agent and performs other transfer agent and shareholder
service functions.
For its services as transfer agent, Unified receives a monthly fee from the
Funds of $1.20 per shareholder (subject to a minimum monthly fee of $900). For
the period December 20, 1999 (commencement of operations of the Fixed Income,
Opportunity Growth, and Value Funds) through August 31, 2000 and for the period
of January 19, 2000 (commencement of operations for Large Cap Fund) through
August 31, 2000, Unified received fees of $10,013, $10,022, and $9,907 from
Nashville Capital Corporation for transfer agent services provided to the Fixed
Income, Opportunity Growth, and Value Funds, respectively and $8,993 for the
Large Cap Fund. In addition, Unified provides each Fund with fund accounting
services, which includes certain monthly reports, record keeping and other
management-related services. For its services as fund accountant, Unified
receives an annual fee from the Nashville Capital Corporation equal to 0.0275%
of each Fund's assets up to $100 million, 0.0250% of each Fund's assets from
$100 million to $300 million and 0.020% of each Fund's assets over $300 million
(subject to various minimum fees, the maximum being $2,100 per month for assets
of $20 to $100 million). For the period December 20, 1999 (commencement of
operations of the Fixed Income, Opportunity Growth, and Value Funds) through
August 31, 2000 and for the period of January 18, 2000 (commencement of
operations for Large Cap Fund) through August 31, 2000, Unified received fees of
$17,319, $17,961, and $15,102 for fund accounting services provided to the Fixed
Income, Opportunity Growth, and Value Funds, respectively, and a fee of $8,205
for fund accounting services provided to the Large Cap Fund.
NOTE 5. SHARE TRANSACTIONS
FIXED INCOME FUND. As of August 31, 2000, there were an unlimited number of
authorized shares for the Fund. Paid in capital at August 31, 2000 was
$30,288,043.
MONTEAGLE FUNDS
NOTES TO FINANCIAL STATEMENTS
AUGUST 31, 2000 - CONTINUED
NOTE 5. SHARE TRANSACTIONS - CONTINUED
Transactions in shares were as follows:
<TABLE>
<CAPTION>
FOR THE PERIOD DECEMBER 20, 1999
(COMMENCEMENT OF OPERATIONS)
TO AUGUST 31, 2000
<S> <C> <C>
SHARES DOLLARS
Shares sold 3,125,249 31,244,919
Shares issued from
Reinvested of Dividend 4,860 48,153
Shares redeemed (214,406) (2,119,549)
------------------- --------------------
2,915,703 $29,173,523
=================== ====================
</TABLE>
OPPORTUNITY GROWTH FUND. As of August 31, 2000, there were an unlimited number
of authorized shares for the Fund. Paid in capital at August 31, 2000 was
$43,001,812.
Transactions in shares were as follows:
<TABLE>
<CAPTION>
FOR THE PERIOD DECEMBER 20, 1999
(COMMENCEMENT OF OPERATIONS)
TO AUGUST 31, 2000
<S> <C> <C>
SHARES DOLLARS
Shares sold 8,618,264 87,385,790
Shares redeemed (1,916,312) (21,338,320)
----------- ------------
6,701,952 $66,047,470
=========== ============
</TABLE>
VALUE FUND. As of August 31, 2000 there was an unlimited number of authorized
shares for the Fund. Paid in capital at August 31, 2000 was $18,985,790.
Transactions in shares were as follows:
<TABLE>
<CAPTION>
FOR THE PERIOD DECEMBER 20, 1999
(COMMENCEMENT OF OPERATIONS)
TO AUGUST 31, 2000
<S> <C> <C>
SHARES DOLLARS
Shares sold 1,883,761 18,835,833
Shares redeemed (190,565) (1,993,457)
-------------- ------------
1,693,196 $16,842,376
============== ============
</TABLE>
LARGE CAP FUND. As of August 31, 2000, there were an unlimited number of
authorized shares for the Fund. Paid in capital at August 31, 2000 was
$12,397,674.
Transactions in shares were as follows:
<TABLE>
<CAPTION>
FOR THE PERIOD JANUARY 18, 1999
(COMMENCEMENT OF OPERATIONS)
TO AUGUST 31, 2000
<S> <C> <C>
SHARES DOLLARS
Shares sold 1,315,309 $12,609,433
Shares redeemed (22,374) (211,759)
------------- ------------
1,292,935 $12,397,674
============= ============
</TABLE>
MONTEAGLE FUNDS
NOTES TO FINANCIAL STATEMENTS
AUGUST 31, 2000 - CONTINUED
NOTE 6. INVESTMENTS
FIXED INCOME FUND. For the period December 20, 1999 (commencement of operations)
to August 31, 2000 purchases and sales of investment securities, other than
short-term investments, aggregated $13,891,412 and $11,620,723, respectively.
The gross unrealized appreciation for all securities totaled $192,954 and the
gross unrealized depreciation for all securities totaled $827,904 for a net
unrealized depreciation of $634,950. The aggregate cost of securities for
federal income tax purposes at August 31, 2000 was $29,656,504.
OPPORTUNITY GROWTH FUND. For the period December 20, 1999 (commencement of
operations) to August 31, 2000 purchases and sales of investment securities,
other than short-term investments, aggregated $286,287,871 and $295,567,172,
respectively. The gross unrealized appreciation for all securities totaled
$15,302,746 and the gross unrealized depreciation for all securities totaled
$176,136 for a net unrealized appreciation of $15,126,610. The aggregate cost of
securities for federal income tax purposes at August 31, 2000 was $61,939,234.
VALUE FUND. For the period December 20, 1999 (commencement of operations) to
August 31, 2000 purchases and sales of investment securities, other than
short-term investments, aggregated $44,428,304 and $45,753,100, respectively.
The gross unrealized appreciation for all securities totaled $1,458,256 and the
gross unrealized depreciation for all securities totaled $1,190,197 for a net
unrealized appreciation of $268,059. The aggregate cost of securities for
federal income tax purposes at August 31, 2000 was $19,420,099.
LARGE CAP FUND. For the period January 18, 2000 (commencement of operations) to
August 31, 2000 purchases and sales of investment securities, other than
short-term investments, aggregated $13,563,736 and $2,178,070, respectively. The
gross unrealized appreciation for all securities totaled $1,110,580 and the
gross unrealized depreciation for all securities totaled $222,044 for a net
unrealized appreciation of $888,536. The aggregate cost of securities for
federal income tax purposes at August 31, 2000 was $11,910,362.
NOTE 7. ESTIMATES
Preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and the reported amounts
of revenues and expenses during the reporting period. Actual results could
differ from those estimates.
NOTE 8. RELATED PARTY TRANSACTIONS
Nashville Capital Corporation and the advisers are not registered broker-dealers
of securities and thus do not receive commissions on trades made on behalf of
the Funds. The beneficial ownership, either directly or indirectly, of more than
25% of the voting securities of a Fund creates a presumption of control of the
Fund, under Section 2(a)(9) of the Investment Company Act of 1940. As of August
31, 2000, Farmers and Merchants Corporation, for the benefit of its customers,
beneficially owned 100% of each Fund.
<PAGE>
INDEPENDENT AUDITOR'S REPORT
To The Shareholders and Board of Trustees
Monteagle Opportunity Growth Fund
Monteagle Value Fund
Monteagle Large Cap Fund
Monteagle Fixed Income Fund
(series of AmeriPrime Advisors Trust)
We have audited the accompanying statements of assets and liabilities, including
the schedules of investments, of the Monteagle Opportunity Growth Fund, the
Monteagle Value Fund, the Monteagle Large Cap Fund and the Monteagle Fixed
Income Fund, as of August 31, 2000, the related statements of operations, the
statements of changes in net assets, and the financial highlights for each of
the periods indicated. These financial statements and financial highlights are
the responsibility of the Funds' management. Our responsibility is to express an
opinion on these 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 investments and cash held as
of August 31, 2000 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 positions of the
Monteagle Opportunity Growth Fund, the Monteagle Value Fund, the Monteagle Large
Cap Fund and the Monteagle Fixed Income Fund as of August 31, 2000, the results
of their operations, the changes in their net assets, and their financial
highlights for each of the periods indicated in conformity with generally
accepted accounting principles.
McCurdy & Associates CPA's, Inc.
Westlake, Ohio 44145
September 24, 2000
