<PAGE> 1
AIM MONEY
MARKET FUND
[AIM LOGO APPEARS HERE] SEMIANNUAL REPORT JUNE 30, 1997
<PAGE> 2
The Chairman's Letter
Dear Fellow Shareholder:
[PHOTO OF We are pleased to send you this report on AIM Money
Charles T. Market Fund for the six months ended June 30, 1997. Fund
Bauer, managers maintained a cautious approach in managing the
Chairman of portfolio during this reporting period amid lingering
the Board of uncertainty about inflation and the direction of interest
THE FUND rates.
APPEARS HERE] As 1997 opened, markets were concerned that vigorous
economic growth might ignite inflation, which would prompt
the Federal Reserve Board (the Fed) to raise interest rates.
The Fed did so in late March, increasing the benchmark
federal funds rate from 5.25% to 5.50%. Rates had been rising
in anticipation of this move, so the increase had effectively
been factored into securities prices by the time it was
announced.
The market remained poised for further rate hikes.
However, the economy began to exhibit signs it was slowing
from the 5.9% annualized growth rate logged during the year's
first quarter. Retail sales declined for three months in a
row from March through May, for example, and single family home sales fell
during both March and April.
Though opinion was generally divided about whether the Fed would raise
rates when it met in May, the economic indicators led the markets to shift
their expectations, and rates declined during the year's second quarter. The
Fed held rates steady at its May meeting, as many forecasts placed
second-quarter growth in the 2% to 2.5% range judged sustainable by the central
bank.
Fund management acted conservatively in this atmosphere, keeping the
portfolio's weighted average maturity quite short: about 20 days. Only late in
the reporting period, as the likelihood of another rate hike diminished, was
the weighted average maturity lengthened to capture higher yields. As the
reporting period closed, weighted average maturity stood at 26.39 days.
Despite a significant drop in short-term market yields late in the
reporting period, the Fund continued to provide competitive yield. As of the
close of the reporting period, seven-day yield was 4.59% for Class A shares,
3.85% for Class B shares, and 4.58% for AIM Cash Reserve Shares. AIM Cash
Reserve Shares was formerly Class C of the AIM Money Market Fund; its name was
changed on May 1, 1997.
As the reporting period closed, a climate of confidence prevailed. While
not unanimous, the general expectation was that Fed policy would remain
unchanged. The economic underpinnings for strong stock and bond markets
appeared to be in place, with inflation remarkably controlled and economic
growth brisk. In July, after the close of the reporting period, the Fed again
left interest rates unchanged.
Nevertheless, caution remained advisable. Any data hinting at an uptick in
inflation or a surge of unsustainable economic growth would induce volatility
in interest rates, and many market experts still anticipate higher short-term
rates during the second half of the year. Fed Chairman Alan Greenspan has
repeatedly made clear that at the first sign of serious inflation he would
encourage the economy to cool off by raising rates. In such an environment,
money market funds provide an attractive shelter from potential market
instability.
AIM Money Market Fund seeks to provide as high a level of current income as
possible consistent with preservation of capital and liquidity by investing in
high-quality money market instruments including commercial paper, repurchase
agreements, and U.S. Treasury and U.S. government agency securities. An
investment in the Fund is neither insured nor guaranteed by the U.S.
government, and there can be no assurance that the Fund will be able to
maintain a stable net asset value of $1.00 per share.
As always, we are ready to respond to your questions or comments about this
report. Please call Client Services at 800-959-4246 during normal business
hours. For automated account information 24 hours per day, please use the AIM
Investor Line at 800-246-5463 or visit our Web Site at www.aimfunds.com.
Sincerely,
/S/ CHARLES T. BAUER
Charles T. Bauer
Chairman
<PAGE> 3
SCHEDULE OF INVESTMENTS
June 30, 1997
(Unaudited)
<TABLE>
<CAPTION>
PAR
MATURITY (000) VALUE
<S> <C> <C> <C>
COMMERCIAL PAPER-46.95%(a)
ASSET-BACKED
SECURITIES-12.19%
Asset Securitization
Cooperative Corp.
5.60% 08/12/97 $14,000 $ 13,908,533
- ----------------------------------------------------------------
Ciesco, L.P.
5.62% 07/07/97 10,000 9,990,634
- ----------------------------------------------------------------
Clipper Receivables Corp.
5.67% 07/14/97 5,000 4,989,763
- ----------------------------------------------------------------
5.59% 09/23/97 14,000 13,817,393
- ----------------------------------------------------------------
Corporate Asset Funding Co.,
Inc.
5.70% 11/19/97 5,600 5,474,980
- ----------------------------------------------------------------
Monte Rosa Capital Corp.
5.57% 07/11/97 20,000 19,969,055
- ----------------------------------------------------------------
Preferred Receivables Funding
Corp.
5.54% 07/17/97 16,350 16,309,742
- ----------------------------------------------------------------
Receivables Capital Corp.
5.56% 07/08/97 6,228 6,221,266
- ----------------------------------------------------------------
5.58% 08/11/97 28,516 28,334,780
- ----------------------------------------------------------------
119,016,146
- ----------------------------------------------------------------
AUTOMOBILE (MANUFACTURERS)-5.55%
Daimler-Benz North America
5.69% 08/15/97 10,000 9,928,875
- ----------------------------------------------------------------
Ford Motor Credit Co.
5.58% 09/02/97 25,000 24,755,875
- ----------------------------------------------------------------
5.59% 12/09/97 20,000 19,500,005
- ----------------------------------------------------------------
54,184,755
- ----------------------------------------------------------------
COMPUTER SOFTWARE & SERVICES-4.36%
First Data Corp.
5.56% 08/26/97 10,000 9,913,356
- ----------------------------------------------------------------
5.57% 08/26/97 20,000 19,827,022
- ----------------------------------------------------------------
5.60% 09/09/97 13,000 12,858,445
- ----------------------------------------------------------------
42,598,823
- ----------------------------------------------------------------
FINANCE (ASSET MANAGEMENT)-2.04%
Merrill Lynch & Co., Inc.
5.53% 08/04/97 20,000 19,895,545
- ----------------------------------------------------------------
FINANCE (CONSUMER
CREDIT)-2.02%
International Lease Finance
Corp.
5.58% 07/29/97 9,900 9,857,034
- ----------------------------------------------------------------
5.60% 09/09/97 10,000 9,891,111
- ----------------------------------------------------------------
19,748,145
- ----------------------------------------------------------------
FINANCE (MISCELLANEOUS)-4.08%
Smith Barney Inc.
5.65% 07/07/97 15,000 14,985,875
- ----------------------------------------------------------------
5.55% 07/30/97 25,000 24,888,229
- ----------------------------------------------------------------
39,874,104
- ----------------------------------------------------------------
<CAPTION>
PAR
MATURITY (000) VALUE
<S> <C> <C> <C>
FOOD PROCESSING-1.01%
Campbell Soup Co.
5.27% 08/26/97 $10,000 $ 9,918,022
- ----------------------------------------------------------------
HOUSEHOLD PRODUCTS-1.02%
Colgate-Palmolive Co.
5.50% 07/15/97 10,000 9,978,611
- ----------------------------------------------------------------
INSURANCE (LIFE &
HEALTH)-2.79%
MetLife Funding, Inc.
5.60% 07/29/97 27,336 27,216,937
- ----------------------------------------------------------------
MEDICAL (DRUGS)-2.03%
Bayer Corp.
5.59% 09/09/97 20,000 19,782,611
- ----------------------------------------------------------------
METAL MINING-1.93%
RTZ America, Inc.
5.57% 09/24/97 14,200 14,013,250
- ----------------------------------------------------------------
U.S. Borax, Inc.
5.58% 12/17/97 5,000 4,869,025
- ----------------------------------------------------------------
18,882,275
- ----------------------------------------------------------------
OIL & GAS (INTEGRATED)-2.05%
Shell Martinez Refining
Co.(b)
5.73% 08/08/97 10,000 10,000,000
- ----------------------------------------------------------------
5.70% 09/24/97 10,000 10,000,000
- ----------------------------------------------------------------
20,000,000
- ----------------------------------------------------------------
PUBLISHING-0.48%
McGraw-Hill Inc.
5.61% 08/29/97 4,700 4,656,788
- ----------------------------------------------------------------
RESIDENTIAL
CONSTRUCTION-4.59%
Weyerhaeuser Real Estate Co.
5.54% 07/16/97 5,000 4,988,459
- ----------------------------------------------------------------
5.52% 07/24/97 15,000 14,947,100
- ----------------------------------------------------------------
5.56% 07/29/97 10,000 9,956,756
- ----------------------------------------------------------------
5.56% 08/05/97 15,000 14,918,917
- ----------------------------------------------------------------
44,811,232
- ----------------------------------------------------------------
TELEPHONE-0.81%
MCI Communications Corp.
5.64% 10/20/97 8,000 7,860,880
- ----------------------------------------------------------------
Total Commercial Paper 458,424,874
- ----------------------------------------------------------------
MASTER NOTE AGREEMENTS(c)-12.50%
Citicorp Securities, Inc.(d)
6.50% 07/28/97 22,000 22,000,000
- ----------------------------------------------------------------
Goldman Sachs & Co.(e)
5.69% 10/20/97 33,000 33,000,000
- ----------------------------------------------------------------
Morgan (J.P.) Securities,
Inc.(f)
6.35% 10/06/97 39,000 39,000,000
- ----------------------------------------------------------------
</TABLE>
2
<PAGE> 4
<TABLE>
<CAPTION>
PAR
MATURITY (000) VALUE
<S> <C> <C> <C>
MASTER NOTE AGREEMENTS-(CONTINUED)
Morgan Stanley, Dean Witter,
Discover & Co.(g)
6.35% 11/24/97 $28,000 $ 28,000,000
- ----------------------------------------------------------------
Total Master Note
Agreements 122,000,000
- ----------------------------------------------------------------
MEDIUM-TERM NOTES-1.02%
FINANCE (PERSONAL
CREDIT)-1.02%
Associates Corp. of North
America(h)
5.57% 03/02/98 10,000 9,994,838
- ----------------------------------------------------------------
Total Medium-Term Notes 9,994,838
- ----------------------------------------------------------------
U.S. GOVERNMENT AGENCY SECURITIES-4.57%
Federal National Mortgage
Association
5.05%(i) 06/02/99 32,000 32,000,000
- ----------------------------------------------------------------
Student Loan Marketing
Association
5.13%(i) 08/20/98 2,600 2,600,000
- ----------------------------------------------------------------
5.15%(i) 02/08/99 10,000 10,002,719
- ----------------------------------------------------------------
Total U.S. Government
Agency Securities 44,602,719
- ----------------------------------------------------------------
Total Investments
(excluding Repurchase
Agreements) 635,022,431
- ----------------------------------------------------------------
<CAPTION>
PAR
MATURITY (000) VALUE
<S> <C> <C> <C>
REPURCHASE AGREEMENTS(j)-29.63%
HSBC Securities, Inc.(k)
6.10% 07/01/97 $40,000 $ 40,000,000
- ----------------------------------------------------------------
Smith Barney, Inc.(l)
6.05% 07/01/97 159,158 159,157,522
- ----------------------------------------------------------------
UBS Securities LLC Inc.(m)
6.10% 07/01/97 90,000 90,000,000
- ----------------------------------------------------------------
Total Repurchase
Agreements 289,157,522
- ----------------------------------------------------------------
TOTAL INVESTMENTS-94.67% 924,179,953(n)
- ----------------------------------------------------------------
OTHER ASSETS LESS LIABILITIES-5.33% 52,039,342
- ----------------------------------------------------------------
NET ASSETS-100.00% $976,219,295
- ----------------------------------------------------------------
</TABLE>
NOTES TO SCHEDULE OF INVESTMENTS:
(a) Some commercial paper is traded on a discount basis. In such cases the
interest rate shown represents the rate of discount paid or received at the
time of purchase by the Fund.
(b) Trust certificates representing an interest in a trust (comprised of
eligible debt obligations) entitling the Fund to receive interest. The Fund
has the right, upon seven calendar days' notice to the trustee, to put its
certificates to the trust at par value plus accrued interest. Because trust
certificates involve a trust and a third party put feature, they involve
complexities and potential risks that may not be present where a debt
obligation is owned directly. Rates shown are the rates in effect on
06/30/97.
(c) The investments in master note agreements are through participation in joint
accounts with other mutual funds, private accounts, and certain
nonregistered investment companies managed by the investment advisor or its
affiliates.
(d) The Fund may demand prepayment of notes purchased under the Master Note
Purchase Agreement upon three business days notice. Interest rates on master
notes are redetermined periodically. Rate shown is the rate in effect on
06/30/97.
(e) The Portfolio may demand prepayment of notes purchased under the Master Note
Purchase Agreement upon seven business days' prior written notice to the
issuer. Interest rates on master notes are redetermined periodically. Rate
shown is the rate in effect on 06/30/97.
(f) The Fund may demand prepayment of notes purchased under the Master Note
Purchase Agreement upon seven calendar days notice. Interest rates on master
notes are redetermined periodically. Rate shown is the rate in effect on
06/30/97.
(g) Master Note Purchase Agreement may be terminated by either party upon three
business days' prior written notice, at which time all amounts outstanding
under the Master Note Agreement will become payable. Rate shown is the rate
in effect on 06/30/97.
(h) Interest rate is redetermined daily. Rate shown is rate in effect on
06/30/97.
(i) Interest rates are redetermined weekly. Rates shown are rates in effect on
06/30/97.
(j) Collateral on repurchase agreements, including the Fund's pro-rata interest
in joint repurchase agreements, is taken into possession by the Fund upon
entering into the repurchase agreement. The collateral is marked to market
daily to ensure its market value as being 102% of the sales price of the
repurchase agreement. The investments in some repurchase agreements are
through participation in joint accounts with other mutual funds, private
accounts and certain nonregistered investment companies managed by the
investment advisor or its affiliates.
(k) Joint repurchase agreement entered into 06/30/97 with a maturing value of
$100,016,944. Collateralized by $97,880,000 U.S. Government obligations,
7.50% due 10/31/99 with a market value at 06/30/97 of $102,002,909.
(l) Joint repurchase agreement entered into 06/30/97 with a maturing value of
$200,033,611. Collateralized by $369,338,000 U.S. Government obligations, 0%
to 10.70% due 09/15/97 to 07/15/43 with an aggregate market value at
06/30/97 of $204,000,115.
(m) Joint repurchase agreement entered into 06/30/97 with a maturing value of
$300,050,833. Collateralized by $320,816,334 U.S. Government obligations, 0%
to 13.25% due 07/14/97 to 04/01/97 with an aggregate market value at
06/30/97 of $306,003,435.
(n) Also represents cost for federal income tax purposes.
See Notes to Financial Statements.
3
<PAGE> 5
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 1997
(UNAUDITED)
<TABLE>
<S> <C>
ASSETS:
Investments, excluding repurchase
agreements, at value (amortized cost) $ 635,022,431
- ----------------------------------------------------------
Repurchase agreements 289,157,522
- ----------------------------------------------------------
Receivables for:
Capital stock sold 83,871,019
- ----------------------------------------------------------
Interest 980,683
- ----------------------------------------------------------
Investment for deferred compensation plan 78,545
- ----------------------------------------------------------
Other assets 148,770
- ----------------------------------------------------------
Total assets 1,009,258,970
- ----------------------------------------------------------
LIABILITIES:
Payables for:
Capital stock reacquired 31,324,402
- ----------------------------------------------------------
Dividends 207,067
- ----------------------------------------------------------
Deferred compensation plan 78,545
- ----------------------------------------------------------
Accrued advisory fees 423,332
- ----------------------------------------------------------
Accrued administrative service fees 6,296
- ----------------------------------------------------------
Accrued distribution fees 678,995
- ----------------------------------------------------------
Accrued transfer agent fees 153,256
- ----------------------------------------------------------
Accrued operating expenses 167,782
- ----------------------------------------------------------
Total liabilities 33,039,675
- ----------------------------------------------------------
Net assets applicable to shares
outstanding $ 976,219,295
==========================================================
NET ASSETS:
Class A $ 381,050,000
==========================================================
Class B $ 128,934,646
==========================================================
AIM Cash Reserve Shares $ 466,234,649
==========================================================
SHARES OUTSTANDING, $0.01 PAR VALUE PER
SHARE:
Class A 380,984,082
==========================================================
Class B 128,918,477
==========================================================
AIM Cash Reserve Shares 466,299,789
==========================================================
Class A:
Net asset value and redemption price per
share $ 1.00
==========================================================
Offering price per share:
(Net asset value of $1.00 divided by
94.50%) $ 1.06
==========================================================
Class B:
Net asset value and offering price per
share $ 1.00
==========================================================
AIM Cash Reserve Shares:
Net asset value, offering and redemption
price per share $ 1.00
==========================================================
</TABLE>
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 1997
(UNAUDITED)
<TABLE>
<S> <C>
INVESTMENT INCOME:
Interest $23,664,122
- ---------------------------------------------------------
EXPENSES:
Advisory fees 2,350,751
- ---------------------------------------------------------
Custodian fees 50,493
- ---------------------------------------------------------
Distribution fees -- Class A 418,000
- ---------------------------------------------------------
Distribution fees -- Class B 612,237
- ---------------------------------------------------------
Distribution fees -- AIM Cash Reserve Shares 498,908
- ---------------------------------------------------------
Trustees' fees 4,644
- ---------------------------------------------------------
Transfer agent fees -- Class A 314,352
- ---------------------------------------------------------
Transfer agent fees -- Class B 136,108
- ---------------------------------------------------------
Transfer agent fees -- AIM Cash Reserve
Shares 283,636
- ---------------------------------------------------------
Administrative service fees 37,208
- ---------------------------------------------------------
Other 351,985
- ---------------------------------------------------------
Total expenses 5,058,322
- ---------------------------------------------------------
Less: Expenses paid indirectly (5,693)
- ---------------------------------------------------------
Net expenses 5,052,629
- ---------------------------------------------------------
Net investment income 18,611,493
- ---------------------------------------------------------
Net realized gain on sales of investments 1,967
- ---------------------------------------------------------
Net increase in net assets resulting from
operations $18,613,460
=========================================================
</TABLE>
See Notes to Financial Statements.
4
<PAGE> 6
STATEMENT OF CHANGES IN NET ASSETS
FOR THE SIX MONTHS ENDED JUNE 30, 1997 AND THE YEAR ENDED DECEMBER 31, 1996
(UNAUDITED)
<TABLE>
<CAPTION>
JUNE 30, DECEMBER 31,
1997 1996
------------ ------------
<S> <C> <C>
OPERATIONS:
Net investment income $ 18,611,493 $ 31,806,351
- ------------------------------------------------------------------------------------------
Net realized gain on sales of investments 1,967 108,101
- ------------------------------------------------------------------------------------------
Net increase in net assets resulting from operations 18,613,460 31,914,452
- ------------------------------------------------------------------------------------------
Distributions to shareholders from net investment income:
Class A (7,445,935) (11,567,004)
- ------------------------------------------------------------------------------------------
Class B (2,280,395) (3,560,364)
- ------------------------------------------------------------------------------------------
AIM Cash Reserve Shares (8,885,163) (16,678,983)
- ------------------------------------------------------------------------------------------
Share transactions-net:
Class A 93,119,799 66,344,581
- ------------------------------------------------------------------------------------------
Class B 37,747,580 21,306,761
- ------------------------------------------------------------------------------------------
AIM Cash Reserve Shares 150,826,554 21,970,272
- ------------------------------------------------------------------------------------------
Net increase in net assets 281,695,900 109,729,715
- ------------------------------------------------------------------------------------------
NET ASSETS:
Beginning of period 694,523,395 584,793,680
- ------------------------------------------------------------------------------------------
End of period $976,219,295 $694,523,395
==========================================================================================
NET ASSETS CONSIST OF:
Shares of beneficial interest $976,202,348 $694,508,415
- ------------------------------------------------------------------------------------------
Undistributed net realized gain on sales of investments 16,947 14,980
- ------------------------------------------------------------------------------------------
$976,219,295 $694,523,395
==========================================================================================
</TABLE>
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1997
(UNAUDITED)
NOTE 1-SIGNIFICANT ACCOUNTING POLICIES
AIM Money Market Fund (the "Fund") is a series portfolio of AIM Funds Group (the
"Trust"). The Trust is a Delaware business trust registered under the Investment
Company Act of 1940, as amended (the "1940 Act"), as an open-end series
management investment company consisting of nine separate series portfolios,
each having an unlimited number of shares of beneficial interest. The Fund
currently offers three different classes of shares: the Class A shares, the
Class B shares and AIM Cash Reserve Shares (formerly, "Class C"). Class A shares
are sold with a front-end sales charge. Class B shares are sold with a
contingent deferred sales charge. AIM Cash Reserve Shares are sold at net asset
value. Matters affecting each portfolio or class will be voted on exclusively by
the shareholders of such portfolio or class. The assets, liabilities and
operations of each portfolio are accounted for separately. Information presented
in these financial statements pertains only to the Fund. The Fund's objective is
to provide as high a level of current income as is consistent with preservation
of capital and liquidity.
The following is a summary of significant accounting policies followed by the
Fund in the preparation of its financial statements. 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 at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
A. Security Valuations -- The Fund invests only in securities which have
maturities of 397 days or less from the date of purchase. The securities are
valued on the basis of amortized cost which approximates market value. This
method values a security at its cost on the date of purchase and thereafter,
assumes a constant amortization to maturity of any discount or premiums.
B. Securities Transactions, Investment Income and Distributions -- Securities
transactions are accounted for on a trade date basis. Realized gains or
losses on sales are computed on the basis of specific identification of the
securities sold. Interest income, adjusted for amortization of premiums and
discounts on investments, is recorded as earned from settlement date and is
recorded on the accrual basis. Dividends to shareholders are declared daily
and are paid monthly.
5
<PAGE> 7
C. Federal Income Taxes -- The Fund intends to comply with the requirements of
the Internal Revenue Code necessary to qualify as a regulated investment
company and, as such, will not be subject to federal income taxes on
otherwise taxable income (including net realized capital gains) which is
distributed to shareholders. Therefore, no provision for federal income
taxes is recorded in the financial statements.
D. Expenses -- Operating expenses directly attributable to a class of shares
are charged to that class' operations. Expenses which are applicable to all
classes, e.g. advisory fees, are allocated among them.
NOTE 2-ADVISORY FEES AND OTHER TRANSACTIONS WITH AFFILIATES
The Trust has entered into a master investment advisory agreement with A I M
Advisors, Inc. ("AIM"). Under the terms of the master investment advisory
agreement, the Fund pays an advisory fee to AIM at an annual rate of 0.55% of
the first $1 billion of the Fund's average daily net assets plus 0.50% of the
Fund's average daily net assets in excess of $1 billion.
The Fund, pursuant to a master administrative services agreement with AIM, has
agreed to reimburse AIM for certain administrative costs incurred in providing
accounting services to the Fund. During the six months ended June 30, 1997, AIM
was reimbursed $37,208 for such services.
The Fund, pursuant to a transfer agency and service agreement, has agreed to
pay A I M Fund Services, Inc. ("AFS") for certain costs incurred in providing
transfer agency and shareholder services to the Fund. During the six months
ended June 30, 1997, the Fund paid AFS $394,592 for such services.
The Trust has entered into master distribution agreements with A I M
Distributors, Inc. ("AIM Distributors") to serve as the distributor for the
Class A shares, the Class B shares and the AIM Cash Reserve Shares of the Fund.
The Trust has adopted Plans pursuant to Rule 12b-1 under the 1940 Act with
respect to the Fund's Class A shares and AIM Cash Reserve Shares (the "Class A
and Cash Reserve Plan") and with respect to the Fund's Class B shares (the
"Class B Plan") (collectively, the "Plans"). The Fund, pursuant to the Class A
and Cash Reserve Plan, pays to AIM Distributors compensation at an annual rate
of 0.25% of the average daily net assets attributable to the Class A shares and
the AIM Cash Reserve Shares. The Class A and Cash Reserve Plan is designed to
compensate AIM Distributors for certain promotional and other sales related
costs and provides periodic payments to selected dealers and financial
institutions who furnish continuing personal shareholder services to their
customers who purchase and own Class A shares or AIM Cash Reserve Shares of the
Fund. The Fund, pursuant to the Class B Plan, pays AIM Distributors compensation
at an annual rate of 1.00% of the average daily net assets attributable to the
Class B shares. Of this amount, the Fund may pay a service fee of 0.25% of the
average daily net assets of the Class B shares to selected dealers and financial
institutions who furnish continuing personal shareholder services to their
customers who purchase and own Class B shares of the Fund. Any amounts not paid
as a service fee under such Plans would constitute an asset-based sales charge.
The Plans also impose a cap on the total sales charges, including asset-based
sales charges, that may be paid by the respective classes. AIM Distributors may,
from time to time, assign, transfer or pledge to one or more assignees, its
rights to all or a portion of (a) compensation received by AIM Distributors from
the Fund pursuant to the Class B Plan (but not AIM Distributors' duties and
obligations pursuant to the Class B Plan) and (b) any contingent deferred sales
charges payable to AIM Distributors related to the Class B shares. During the
six months ended June 30, 1997, the Class A shares, the Class B shares and the
AIM Cash Reserve Shares paid AIM Distributors $418,000, $612,237 and $498,908,
respectively, as compensation under the Plans.
AIM Distributors received commissions of $247,389 from sales of the Class A
shares of the Fund during the six months ended June 30, 1997. Such commissions
are not an expense of the Fund. They are deducted from, and are not included in,
the proceeds from sales of Class A shares. During the six months ended June 30,
1997, AIM Distributors received $161,317 in contingent deferred sales charges
imposed on redemptions of Fund shares. Certain officers and trustees of the
Trust are officers and directors of AIM, AIM Distributors and AFS.
During the six months ended June 30, 1997, the Fund paid legal fees of $3,562
for services rendered by Kramer, Levin, Naftalis & Frankel as counsel to the
Board of Trustees. A member of that firm is a trustee of the Trust.
NOTE 3-INDIRECT EXPENSES
During the six months ended June 30, 1997 the Fund received reductions in
transfer agency fees from AFS (an affiliate of AIM) and reductions in custodian
fees of $5,665 and $28, respectively under expense offset arrangements. The
effect of the above arrangements resulted in reductions of the Fund's total
expenses of $5,693 during the six months ended June 30, 1997.
NOTE 4-TRUSTEES' FEES
Trustees' fees represent remuneration paid or accrued to each trustee who is not
an "interested person" of AIM. The Trust may invest trustees' fees, if so
elected by a trustee, in mutual fund shares in accordance with a deferred
compensation plan.
6
<PAGE> 8
NOTE 5-SHARE INFORMATION
Changes in shares outstanding during the six months ended June 30, 1997 and the
year ended December 31, 1996 were as follows:
<TABLE>
<CAPTION>
JUNE 30, 1997 DECEMBER 31, 1996
--------------------------------- ---------------------------------
SHARES VALUE SHARES AMOUNT
-------------- --------------- -------------- ---------------
<S> <C> <C> <C> <C>
Sold:
Class A 1,610,652,779 $ 1,610,652,779 2,107,832,986 $ 2,107,832,986
- ----------------------------------------------------- --------------------------------- ---------------------------------
Class B 228,926,807 228,926,807 334,518,591 334,518,591
- ----------------------------------------------------- --------------------------------- ---------------------------------
AIM Cash Reserve Shares 2,124,769,030 2,124,769,030 3,871,719,488 3,871,719,488
- ----------------------------------------------------- --------------------------------- ---------------------------------
Issued as reinvestment of dividends:
Class A 6,605,298 6,605,298 10,061,164 10,061,164
- ----------------------------------------------------- --------------------------------- ---------------------------------
Class B 2,031,097 2,031,097 3,197,896 3,197,896
- ----------------------------------------------------- --------------------------------- ---------------------------------
AIM Cash Reserve Shares 7,568,186 7,568,186 14,185,926 14,185,926
- ----------------------------------------------------- --------------------------------- ---------------------------------
Reacquired:
Class A (1,524,138,278) (1,524,138,278) (2,051,549,569) (2,051,549,569)
- ----------------------------------------------------- --------------------------------- ---------------------------------
Class B (193,210,324) (193,210,324) (316,409,726) (316,409,726)
- ----------------------------------------------------- --------------------------------- ---------------------------------
AIM Cash Reserve Shares (1,981,510,662) (1,981,510,662) (3,863,935,142) (3,863,935,142)
- ----------------------------------------------------- --------------------------------- ---------------------------------
281,693,933 $ 281,693,933 109,621,614 $ 109,621,614
===================================================== ================================= ==================================
</TABLE>
NOTE 6-FINANCIAL HIGHLIGHTS
Shown below are the financial highlights for a Class A share, a Class B share
and an AIM Cash Reserve Share outstanding during the six months ended June 30,
1997, each of the years in the three-year period ended December 31, 1996 and the
period October 16, 1993 (date operations commenced) through December 31, 1993.
<TABLE>
<CAPTION>
CLASS A SHARES CLASS B SHARES
------------------------------------------ ---------------------------------
DECEMBER 31, DECEMBER 31,
JUNE 30, ------------------------------------------ JUNE 30, -------------------
1997 1996 1995 1994 1993 1997 1996 1995
-------- -------- -------- -------- -------- -------- -------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning
of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
- --------------------------- -------- -------- -------- -------- -------- -------- -------- -------
Income from investment
operations:
Net investment income 0.0220 0.0433 0.0495 0.0337 0.0048 0.0184 0.0360 0.0419
- --------------------------- -------- -------- -------- -------- -------- -------- -------- -------
Less distributions:
Dividends from net
investment income (0.0220) (0.0433) (0.0495) (0.0337) (0.0048) (0.0184) (0.0360) (0.0419)
- --------------------------- -------- -------- -------- -------- -------- -------- -------- -------
Net asset value, end of
period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
=========================== ======== ======== ======== ======== ======== ======== ======== =======
Total return(a) 4.49% 4.42% 5.06% 3.43% 2.27%(e) 3.74% 3.66% 4.27%
=========================== ======== ======== ======== ======== ======== ======== ======== =======
Ratios/supplemental data:
Net assets, end of period
(000s omitted) $381,050 $287,905 $221,487 $148,886 $ 81,460 $128,935 $ 91,148 $69,857
=========================== ======== ======== ======== ======== ======== ======== ======== =======
Ratio of expenses to
average net assets 1.07%(b)(c) 1.07% 1.03% 0.97%(d) 1.00%(d)(e) 1.81%(b)(c) 1.81% 1.78%
=========================== ======== ======== ======== ======== ======== ======== ======== =======
Ratio of net investment
income to average net
assets 4.45%(b) 4.34% 4.91% 3.53%(d) 2.27%(d)(e) 3.72%(b) 3.60% 4.14%
=========================== ======== ======== ======== ======== ======== ======== ======== =======
<CAPTION>
CLASS B SHARES AIM CASH RESERVE SHARES
-------------------- --------------------------------------------------------
DECEMBER 31, DECEMBER 31,
-------------------- JUNE 30, --------------------------------------------
1994 1993 1997 1996 1995 1994 1993
-------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning
of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
- --------------------------- -------- -------- -------- -------- -------- -------- --------
Income from investment
operations:
Net investment income 0.0259 0.0032 0.0220 0.0433 0.0493 0.0337 0.0048
- --------------------------- -------- -------- -------- -------- -------- -------- --------
Less distributions:
Dividends from net
investment income (0.0259) (0.0032) (0.0220) (0.0433) (0.0493) (0.0337) (0.0048)
- --------------------------- -------- -------- -------- -------- -------- -------- --------
Net asset value, end of
period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
=========================== ======== ======== ======== ======== ======== ======== ========
Total return(a) 2.62% 1.51%(e) 4.49% 4.41% 5.04% 3.42% 2.27%(e)
=========================== ======== ======== ======== ======== ======== ======== ========
Ratios/supplemental data:
Net assets, end of period
(000s omitted) $ 33,999 $ 1,289 $466,235 $315,470 $293,450 $359,952 $241,778
=========================== ======== ======== ======== ======== ======== ======== ========
Ratio of expenses to
average net assets 1.78%(f) 1.75%(e)(f) 1.08%(b)(c) 1.08% 1.04% 0.99%(g) 1.00%(e)(g)
=========================== ======== ======== ======== ======== ======== ======== ========
Ratio of net investment
income to average net
assets 3.14%(f) 1.54%(e)(f) 4.45%(b) 4.32% 4.92% 3.49%(g) 2.27%(e)(g)
=========================== ======== ======== ======== ======== ======== ======== ========
</TABLE>
(a) Does not deduct sales charges or contingent deferred sales charges, where
applicable and are not annualized for periods less than one year.
(b) Ratios are annualized and based on average daily net assets as follows:
Class A shares -$337,171,370, Class B shares - $123,462,174 and AIM Cash
Reserve Shares - $402,433,762.
(c) Ratio includes expenses paid indirectly. Excluding expenses paid indirectly
the ratio of expenses to average daily net assets would have been the same.
(d) After fee waivers and/or expense reimbursements. Ratios of expenses and net
investment income to average daily net assets prior to fee waivers and/or
expense reimbursements are 1.06% and 3.44% for 1994 and 1.20% (annualized)
and 2.07% (annualized) for 1993.
(e) Annualized.
(f) After fee waivers and/or expense reimbursements. Ratios of expenses and net
investment income to average daily net assets prior fee waivers and/or
expense reimbursements are 1.87% and 3.05% for 1994 and 1.95% (annualized)
and 1.34% (annualized) for 1993.
(g) After fee waivers and/or expense reimbursements. Ratios of expenses and net
investment income to average daily net assets prior to fee waivers and/or
expense reimbursements are 1.08% and 3.40% for 1994 and 1.20% (annualized)
and 2.07% (annualized) for 1993.
7
<PAGE> 9
SUPPLEMENTAL PROXY INFORMATION -- SHAREHOLDER MEETING
- --------------------------------------------------------------------------------
The Annual Meeting of Shareholders of the Trust was held on February 7, 1997.
The meeting was held for the following purposes:
(1) To elect trustees as follows: Charles T. Bauer, Bruce L. Crockett, Owen Daly
II, Carl Frischling, Robert H. Graham, John F. Kroeger, Lewis F. Pennock,
Ian W. Robinson, and Louis S. Sklar.
(2) To approve a new Investment Advisory Agreement between the Trust and AIM.
(3) To approve the elimination of the fundamental investment policy prohibiting
or restricting investments in other investment companies and/or the
amendment of certain related fundamental investment policies.
(4) Ratification of KPMG Peat Marwick LLP as independent accountants for the
Trust's fiscal year ending December 31, 1997.
The following votes were cast with respect to each item:
<TABLE>
<CAPTION>
Votes
Trustee/Matter Votes For Against Abstentions
-------------- --------- ------------- -----------
<S> <C> <C> <C> <C>
(1) Charles T. Bauer............................................ 773,545,353 0 34,024,196
Bruce L. Crockett........................................... 774,171,487 0 33,398,063
Owen Daly II................................................ 773,623,278 0 33,946,270
Carl Frischling............................................. 773,902,641 0 33,666,910
Robert H. Graham............................................ 774,181,971 0 33,387,581
John F. Kroeger............................................. 773,713,539 0 33,856,014
Lewis F. Pennock............................................ 773,903,304 0 33,666,247
Ian W. Robinson............................................. 773,753,378 0 33,816,174
Louis S. Sklar.............................................. 773,993,581 0 33,575,971
(2) Approval of new Investment Advisory Agreement............... 339,829,087 3,685,225 19,168,424
(3) Elimination of policy restricting investments in other
investment companies (for AIM Money Market Fund only)....... 278,910,129 7,162,660 20,201,003
(4) KPMG Peat Marwick LLP....................................... 763,580,956 7,014,082 36,974,512
</TABLE>
8
<PAGE> 10
Trustees & Officers
<TABLE>
<S> <C>
BOARD OF TRUSTEES OFFICERS OFFICE OF THE FUND
Charles T. Bauer Charles T. Bauer 11 Greenway Plaza
Chairman Chairman Suite 100
A I M Management Group Inc. Houston, TX 77046
Robert H. Graham
Bruce L. Crockett President INVESTMENT ADVISOR
Formerly Director, President, and Chief
Executive Officer John J. Arthur A I M Advisors, Inc.
COMSAT Corporation Senior Vice President and Treasurer 11 Greenway Plaza
Suite 100
Owen Daly II Carol F. Relihan Houston, TX 77046
Director Senior Vice President
Cortland Trust Inc. and Secretary TRANSFER AGENT
Jack Fields Gary T. Crum A I M Fund Services, Inc.
Formerly Member of the Senior Vice President P.O. Box 4739
U.S. House of Representatives Houston, TX 77210-4739
Scott G. Lucas
Carl Frischling Senior Vice President CUSTODIAN
Partner
Kramer, Levin, Naftalis & Frankel Dana R. Sutton State Street Bank & Trust Company
Vice President and Assistant Treasurer 225 Franklin Street
Robert H. Graham Boston, MA 02110
President and Chief Executive Officer Robert G. Alley
A I M Management Group Inc. Vice President COUNSEL TO THE FUND
John F. Kroeger Stuart W. Coco Ballard Spahr
Formerly Consultant Vice President Andrews & Ingersoll
Wendell & Stockel Associates, Inc. 1735 Market Street
Melville B. Cox Philadelphia, PA 19103
Lewis F. Pennock Vice President
Attorney COUNSEL TO THE TRUSTEES
Karen Dunn Kelly
Ian W. Robinson Vice President Kramer, Levin, Naftalis & Frankel
Consultant; Formerly Executive 919 Third Avenue
Vice President and Jonathan C. Schoolar New York, NY 10022
Chief Financial Officer Vice President
Bell Atlantic Management DISTRIBUTOR
Services, Inc. P. Michelle Grace
Assistant Secretary A I M Distributors, Inc.
Louis S. Sklar 11 Greenway Plaza
Executive Vice President David L. Kite Suite 100
Hines Interests Assistant Secretary Houston, TX 77046
Limited Partnership
Nancy L. Martin
Assistant Secretary
Ofelia M. Mayo
Assistant Secretary
Kathleen J. Pflueger
Assistant Secretary
Samuel D. Sirko
Assistant Secretary
Stephen I. Winer
Assistant Secretary
Mary J. Benson
Assistant Treasurer
</TABLE>
This report may be distributed only to current shareholders or to persons
who have received a current prospectus of the Fund.
<PAGE> 11
<TABLE>
<S> <C>
THE AIM FAMILY OF FUNDS--Registered Trademark--
AGGRESSIVE GROWTH
AIM Aggressive Growth Fund*
AIM Capital Development Fund
AIM Constellation Fund
AIM Global Aggressive Growth Fund
GROWTH OF CAPITAL
AIM Advisor International Value Fund
[PHOTO OF AIM Blue Chip Fund
11 GREENWAY PLAZA AIM Global Growth Fund
APPEARS HERE] AIM Growth Fund
AIM International Equity Fund
AIM Value Fund
AIM Weingarten Fund
GROWTH AND INCOME OR INCOME WITH CAPITAL GROWTH
AIM Advisor Flex Fund
AIM Advisor Large Cap Value Fund
AIM Advisor MultiFlex Fund
AIM Advisor Real Estate Fund
AIM Balanced Fund
AIM Charter Fund
AIM Global Utilities Fund
HIGH CURRENT INCOME OR CURRENT INCOME
AIM High Yield Fund
AIM Global Income Fund
AIM Income Fund
CURRENT TAX-FREE INCOME
AIM Municipal Bond Fund
AIM Tax-Exempt Bond Fund of Connecticut
AIM Tax-Free Intermediate Shares
CURRENT INCOME AND HIGH DEGREE OF SAFETY
AIM Intermediate Government Fund
AIM Limited Maturity Treasury Shares
AIM Money Market Fund
AIM Tax-Exempt Cash Fund
A I M Management Group Inc. has provided leadership in the *AIM Aggressive Growth Fund was closed to new investors on
mutual fund industry since 1976 and managed approximately June 5, 1997. For more complete information about any AIM
$72 billion in assets for more than 3.5 million shareholders, Fund(s), including sales charges and expenses, ask your
including individual investors, corporate clients, and financial financial consultant or securities dealer for a free
institutions as of June 30, 1997. The AIM Family of prospectus(es). Please read the prospectus(es) carefully
Funds--Registered Trademark-- is distributed nationwide, and before you invest or send money.
AIM today ranks among the nation's top 15 mutual fund
companies in assets under management, according to Lipper INVEST WITH DISCIPLINE-SM-
Analytical Services, Inc.
[AIM LOGO APPEARS HERE] -----------------
BULK RATE
A I M Distributors, Inc. U.S. POSTAGE
11 Greenway Plaza, Suite 100 PAID
Houston, TX 77046 HOUSTON, TX
Permit No. 1919
-----------------
</TABLE>
