[LOGO OMITTED] WM
GROUP OF FUNDS
THE DIFFERENCE IS EXPERIENCE
SEMI-ANNUAL REPORT
FOR THE PERIOD ENDED APRIL 30, 2000
[GRAPHICS OMITTED]
<PAGE>
EQUITY FUNDS
bond & stock fund CONTENTS
growth & income fund
growth fund of the northwest message from the president 1
growth fund
statement of assets 2
mid-cap stock fund and liabilities
small cap stock fund
international growth fund statements of operations 6
FIXED-INCOME FUNDS
statements of changes 8
in net assets
short term income fund
u.s. government securities fund
income fund statements of changes 12
in net assets -- capital
high yield fund stock activity
MUNICIPAL FUNDS
financial highlights 18
tax-exempt bond fund
california municipal fund
portfolio of investments 48
california insured
intermediate municipal fund
florida insured municipal fund notes to financial 94
statements
(unaudited)
[GRAPHICS OMITTED]
<PAGE>
[PHOTO OMITTED]
Dear Shareholder,
The tides of the equity markets shifted in the past six months, as the prices of
many stocks that drove markets to new highs in late 1999 retreated. Although
first quarter earnings were strong and most companies had healthy balance
sheets, prices of many growth stocks were overextended, peaking in early March.
This concentrated correction may be a healthy revaluation and could pave the way
for the return of market breadth. Some of the "Old Economy" stocks should
continue to gain favor relative to higher-valued "dot com" companies. Market
volatility has been unprecedented, as four of the technology-heavy NASDAQ
Index's ten worst historical days (on a percentage basis) were recorded in April
2000.
The recent divergence of market indices can create confusion when reported by
media sources. Historically, the Dow Jones Industrial Average (DJIA), which is
most watched, dates back prior to 1900 and measures 30 of the country's largest
companies' stock performance. With increased investment awareness and
intensified financial news reporting, additional indices are now being followed
on a minute-by-minute basis around the globe. For example, the Standard & Poor's
500 (S&P 500) Index, a capitalization-weighted compilation of 500 of the largest
companies traded on domestic market exchanges, has become the most common
benchmark used by domestic equity mutual funds. It is broader in scope than the
DJIA and more indicative of the overall large-cap market. Another index that has
grabbed recent headlines is the NASDAQ. It has a much more significant exposure
to small- and medium-sized companies. Much of the NASDAQ's popularity can be
attributed to its concentration in technology holdings and its meteoric rise in
the past several years. No matter what index you track, it is important to keep
the scope and relative magnitude of the daily moves in perspective. While 100
point fluctuations in the DJIA attracted headlines in the past, this now only
represents a 1% move and has become routine. For comparative purposes, 100
points on the NASDAQ index is approximately 3%. During the 12-month period ended
April 30, 2000, the weekly risk or volatility of the NASDAQ Index was nearly
double that of the DJIA.(1)
Since the biggest advances in the past several years were narrowly focused,
portfolio managers who had stayed away from large concentrations in the hottest
sectors were stung by weaker relative performance. Now, as the markets appear to
be shifting, adherence to a long-term strategy and investment discipline becomes
crucial. THE WM GROUP OF FUNDS' unique focus on strict investment philosophy
could pay off with a broadening market and a resurgence of some core value
holdings that generate consistent cash flows and earnings. Because of the recent
narrow focus, it is important to manage our expectations of the equity markets.
The five-year period ended December 31, 1999, was the strongest ever, with the
S&P 500 returning an average of over 28%(2) per year. As we have seen since this
past March, these steep gains, particularly for the largest growth stocks, will
not continue forever. Therefore, we have to manage our portfolios with that in
mind. There are several strategies and solutions that can help temper short-term
market fluctuations including: regular investments, diversified portfolios with
multiple asset classes, and sticking with a long-term plan.
During the period, we added the WM MID CAP STOCK FUND to help round out our Fund
family. The Fund will focus on taking advantage of the growth potential from
medium-sized companies. We also changed the names of a few of our Funds to more
closely match their investment objectives, making it easier for you to
understand how the Funds could possibly fit your individual investment needs.
I again stress the importance of meeting with your Investment Representative and
maintaining a long-term diversified focus. Your Representative can assess your
risk tolerance and help you make any changes necessary to put you on track
toward meeting your long-term goals. At the WM GROUP OF FUNDS, our experience
has proven that the key to successful investing is a long-term focus. Markets
will shift in response to short-term conditions, but long-term investing does
not depend on accurate predictions of short-term events.
We will continue to build, grow and leverage our experience and history to help
meet your investment needs - just as we have for over 60 years. Thank you for
your continued confidence in the WM GROUP OF FUNDS.
Sincerely,
/S/ William G. Papesh
William G. Papesh
President
(1) SOURCE: NASDAQ AND DOW JONES. BOTH ARE UNMANAGED INDICES OF COMMON STOCKS.
RISK IS MEASURED BY STANDARD DEVIATION OR THE MOVEMENT AROUND THE MEAN
RETURN.
(2) SOURCE: IBBOTSON ASSOCIATES. THE S&P 500 IS AN UNMANAGED INDEX OF COMMON
STOCKS. RESULTS INCLUDE REINVESTMENT OF DIVIDENDS. PAST PERFORMANCE IS NO
GUARANTEE OF FUTURE RESULTS. INDIVIDUALS CANNOT INVEST DIRECTLY IN ANY
INDEX.
1
<PAGE>
STATEMENTS OF ASSETS AND LIABILITIES
WM GROUP OF FUNDS
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
BOND & GROWTH & GROWTH FUND MID CAP SMALL CAP
STOCK INCOME OF THE GROWTH STOCK STOCK
FUND FUND NORTHWEST FUND FUND FUND
------------ ------------ ------------ -------------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
ASSETS:
Investments, at value
(See portfolios of investments):
Securities .......................... $258,042,763 $1,521,203,769 $610,044,391 $1,313,422,242 $124,133,500 $255,599,334
Repurchase Agreements ............... 1,821,000 10,266,000 39,213,000 -- 8,913,000 6,018,000
------------ -------------- ------------ -------------- ------------ ------------
Total Investments (a) ............. 259,863,763 1,531,469,769 649,257,391 1,313,422,242 133,046,500 261,617,334
Cash and/or foreign currency (b) ....... -- -- -- 34,641 804 11,788
Cash held as collateral for loaned
securities (note 7) ................. 8,894,809 17,578,800 5,630,955 40,764,755 -- 1,384,300
Net unrealized appreciation on forward
foreign currency contracts
(See portfolios of investments) ..... -- -- -- 9,503,059 -- --
Variation margin ....................... -- -- -- -- -- --
Dividends and/or interest receivable ... 1,518,053 997,749 198,686 68,372 55,179 37,175
Receivable for Fund shares sold ........ 353,983 3,177,340 2,684,314 7,579,668 1,081,212 1,866,317
Receivable for investment
securities sold ..................... 3,339,688 13,121,800 -- -- -- 1,012,304
Prepaid expenses ....................... 6,734 32,301 13,023 27,242 1,366 5,998
------------ -------------- ------------ -------------- ------------ ------------
Total Assets ...................... 273,977,030 1,566,377,759 657,784,369 1,371,399,979 134,185,061 265,935,216
------------ -------------- ------------ -------------- ------------ ------------
LIABILITIES:
Net unrealized depreciation on forward
foreign currency contracts
(See portfolios of investments) ..... -- -- -- -- -- --
Collateral on securities loaned (note 7) 8,894,809 17,578,800 5,630,955 40,764,755 -- 1,384,300
Payable for Fund shares redeemed ....... 723,329 1,551,407 868,999 5,821,389 101 240,904
Payable for when-issued securities ..... -- -- -- -- -- --
Payable for investment securities
purchased ........................... 1,757,184 7,196,159 7,287,534 4,273,809 5,012,793 2,227,213
Variation margin ....................... -- -- -- -- -- --
Investment advisory fee payable ........ 134,094 648,982 313,795 815,090 73,344 184,470
Shareholder servicing and distribution
fees payable ........................ 90,049 335,794 180,419 472,018 611 73,194
Dividends payable ...................... -- -- -- -- -- --
Due to custodian ....................... 570,576 1,514 411 -- -- --
Accrued printing and postage fees ...... 57,729 243,942 120,442 246,516 4,319 98,482
Accrued expenses and other payables .... 75,069 249,143 63,729 277,757 18,019 68,268
------------ -------------- ------------ -------------- ------------ ------------
Total Liabilities .................. 12,302,839 27,805,741 14,466,284 52,671,334 5,109,187 4,276,831
------------ -------------- ------------ -------------- ------------ ------------
NET ASSETS ............................. $261,674,191 $1,538,572,018 $643,318,085 $1,318,728,645 $129,075,874 $261,658,385
============ ============== ============ ============== ============ ============
=================
(a) Investments, at cost ............... $232,920,916 $1,171,135,930 $440,622,296 $ 947,535,686 $120,468,758 $226,646,994
============ ============== ============ ============== ============ ============
(b) Cash and/or foreign currency,
at cost/(benefit) ................. $ -- $ -- $ -- $ (297,708) $ 804 $ 11,788
============ ============== ============ ============== ============ ============
</TABLE>
<TABLE>
<CAPTION>
U.S.
INTERNATIONAL SHORT TERM GOVERNMENT HIGH TAX-EXEMPT
GROWTH INCOME SECURITIES INCOME YIELD BOND
FUND FUND FUND FUND FUND FUND
------------ ----------- ----------- ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
ASSETS:
Investments, at value
(See portfolios of investments):
Securities .......................... $201,018,231 $121,707,396 $ 436,283,758 $385,952,611 $154,427,090 $245,076,074
Repurchase Agreements ............... 2,431,000 -- 14,161,000 14,779,000 9,903,000 --
------------ ------------ -------------- ------------ ------------ ------------
Total Investments (a) ............. 203,449,231 121,707,396 450,444,758 400,731,611 164,330,090 245,076,074
Cash and/or foreign currency (b) ....... 140,248 -- -- 800,648 632 150,483
Cash held as collateral for loaned
securities (note 7) ................. 7,103,000 359,470 13,563,250 15,903,699 4,547,700 --
Net unrealized appreciation on forward
foreign currency contracts
(See portfolios of investments) ..... -- -- -- -- -- --
Variation margin ....................... -- 14,218 -- -- -- 67,018
Dividends and/or interest receivable ... 631,998 1,815,078 3,139,359 6,880,212 3,407,887 3,628,083
Receivable for Fund shares sold ........ 553,702 -- 939,399 2,132,186 678,042 526,649
Receivable for investment
securities sold ..................... 816,721 248,030 -- 2,964 -- 332,390
Prepaid expenses ....................... 4,928 3,431 10,566 8,043 2,743 6,028
------------ ------------ ------------ ------------ ------------ ------------
Total Assets ...................... 212,699,828 124,147,623 468,097,332 426,459,363 172,967,094 249,786,725
------------ ------------ ------------ ------------ ------------ ------------
LIABILITIES:
Net unrealized depreciation on forward
foreign currency contracts
(See portfolios of investments) ..... 457,235 -- -- -- -- --
Collateral on securities loaned (note 7) 7,103,000 359,470 13,563,250 15,903,699 4,547,700 --
Payable for Fund shares redeemed ....... 356,040 747,133 1,104,923 643,236 171,054 552,993
Payable for when-issued securities ..... -- -- -- -- -- 5,086,290
Payable for investment securities
purchased ........................... 66,931 -- -- -- 1,350,696 2,942,864
Variation margin ....................... -- -- -- -- -- --
Investment advisory fee payable ........ 160,175 22,347 200,159 208,860 82,014 105,824
Shareholder servicing and distribution
fees payable ........................ 18,846 7,756 85,807 62,658 22,819 65,177
Dividends payable ...................... -- 29,980 339,874 286,463 806 320,299
Due to custodian ....................... -- 41,920 88,344 -- -- --
Accrued printing and postage fees ...... 33,802 13,466 60,834 72,093 12,515 32,641
Accrued expenses and other payables .... 96,047 43,635 80,360 72,667 60,293 41,773
------------ ------------ ------------ ------------ ------------ ------------
Total Liabilities .................. 8,292,076 1,265,707 15,523,551 17,249,676 6,247,897 9,147,861
------------ ------------ ------------ ------------ ------------ ------------
NET ASSETS ............................. $204,407,752 $122,881,916 $452,573,781 $409,209,687 $166,719,197 $240,638,864
============ ============ ============ ============ ============ ============
=================
(a) Investments, at cost ............... $158,128,411 $125,172,538 $466,532,701 $407,496,486 $165,242,194 $238,448,921
============ ============ ============ ============ ============ ============
(b) Cash and/or foreign currency,
at cost/(benefit) ................. $ 1,395 $ -- $ -- $ 800,648 $ 632 $ 150,483
============ ============ ============ ============ ============ ============
</TABLE>
<TABLE>
<CAPTION>
CALIFORNIA
INSURED FLORIDA
CALIFORNIA INTERMEDIATE INSURED
MUNICIPAL MUNICIPAL MUNICIPAL
FUND FUND FUND
------------ ------------ -----------
<S> <C> <C> <C>
ASSETS:
Investments, at value
(See portfolios of investments):
Securities .......................... $385,308,388 $ 61,492,745 $ 16,097,163
Repurchase Agreements ............... -- -- --
------------ ------------ ------------
Total Investments (a) ............. 385,308,388 61,492,745 16,097,163
Cash and/or foreign currency (b) ....... 429,614 35,839 68,988
Cash held as collateral for loaned
securities (note 7) ................. -- -- --
Net unrealized appreciation on forward
foreign currency contracts
(See portfolios of investments) ..... -- -- --
Variation margin ....................... -- -- 750
Dividends and/or interest receivable ... 5,737,305 839,052 233,186
Receivable for Fund shares sold ........ 1,202,285 89,736 20,567
Receivable for investment
securities sold ..................... 70,000 -- --
Prepaid expenses ....................... 9,639 1,576 451
------------ ------------ ------------
Total Assets ...................... 392,757,231 62,458,948 16,421,105
------------ ------------ ------------
LIABILITIES:
Net unrealized depreciation on forward
foreign currency contracts
(See portfolios of investments) ..... -- -- --
Collateral on securities loaned (note 7) -- -- --
Payable for Fund shares redeemed ....... 1,208,073 28,966 240,085
Payable for when-issued securities ..... 3,147,781 -- --
Payable for investment securities
purchased ........................... 2,470,131 -- --
Variation margin ....................... 30,000 4,875 --
Investment advisory fee payable ........ 159,103 25,673 6,813
Shareholder servicing and distribution
fees payable ........................ 163,793 33,675 7,320
Dividends payable ...................... 542,407 52,198 29,057
Due to custodian ....................... -- -- --
Accrued printing and postage fees ...... 34,841 5,356 1,879
Accrued expenses and other payables .... 63,070 16,578 6,988
------------ ------------ ------------
Total Liabilities .................. 7,819,199 167,321 292,142
------------ ------------ ------------
NET ASSETS ............................. $384,938,032 $ 62,291,627 $ 16,128,963
============ ============ ============
=================
(a) Investments, at cost ............... $386,123,091 $ 61,143,111 $ 15,874,437
============ ============ ============
(b) Cash and/or foreign currency,
at cost/(benefit) ................. $ 429,614 $ 35,839 $ 68,988
============ ============ ============
</TABLE>
See Notes to Financial Statements.
2 & 3
<PAGE>
STATEMENTS OF ASSETS AND LIABILITIES (CONTINUED)
WM GROUP OF FUNDS
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
BOND & GROWTH & GROWTH FUND MID CAP SMALL CAP
STOCK INCOME OF THE GROWTH STOCK STOCK
FUND FUND NORTHWEST FUND FUND FUND
------------ -------------- ------------ -------------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
NET ASSETS CONSIST OF:
Undistributed net investment income/
(accumulated net investment loss/
distributions in excess of net
investment income) ............... $ 1,067,949 $ (512,819) $ (145,937)$ (5,416,926) $ 49,262 $ (1,285,996)
Accumulated net realized gain/(loss) on
investments sold, futures contracts,
closed written options, forward foreign
currency contracts and foreign currency
transactions ..................... 24,303,183 82,708,163 83,279,389 183,913,056 -- 30,203,059
Net unrealized appreciation/(depreciation)
of investments, foreign currency,
futures contracts, forward foreign
currency contracts and other
assets and liabilities ........... 26,942,847 360,333,839 208,635,095 375,721,713 12,577,742 34,970,340
Paid-in capital ..................... 209,360,212 1,096,042,835 351,549,538 764,510,802 116,448,870 197,770,982
------------ -------------- ------------ -------------- ------------ ------------
Total Net Assets ................. $261,674,191 $1,538,572,018 $643,318,085 $1,318,728,645 $129,075,874 $261,658,385
============ ============== ============ ============== ============ ============
NET ASSETS:
Class A Shares ...................... $204,492,518 $ 675,223,163 $437,525,797 $ 385,269,959 $ 878,000 $132,838,929
============ ============== ============ ============== ============ ============
Class B Shares ...................... $ 57,181,673 $ 243,730,071 $110,260,757 $ 498,344,234 $ 731,256 $ 52,235,368
============ ============== ============ ============== ============ ============
Class I Shares ...................... -- $ 619,618,784 $ 95,531,531 $ 435,114,452 $127,466,618 $ 76,584,088
============== ============ ============== ============ ============
SHARES OUTSTANDING:
Class A Shares ...................... 14,075,621 26,021,973 12,109,487 10,561,296 77,940 5,186,375
============ ============== ============ ============== ============ ============
Class B Shares ...................... 3,953,755 9,576,554 3,226,186 14,494,418 65,048 2,172,476
============ ============== ============ ============== ============ ============
Class I Shares ...................... -- 23,831,661 2,639,599 11,789,261 11,309,214 2,984,343
============== ============ ============== ============ ============
CLASS A SHARES:
Net asset value per share of beneficial
interest outstanding* ........... $14.53 $25.95 $36.13 $36.48 $11.27 $25.61
============ ============== ============ ============== ============ ============
Maximum Sales Charge ............... 5.50% 5.50% 5.50% 5.50% 5.50% 5.50%
============ ============== ============ ============== ============ ============
Maximum offering price per share of
beneficial interest outstanding . $15.38 $27.46 $38.23 $38.60 $11.93 $27.10
============ ============== ============ ============== ============ ============
CLASS B SHARES:
Net asset value and offering price per
share of beneficial interest
outstanding* .................... $14.46 $25.45 $34.18 $34.38 $11.24 $24.04
============ ============== ============ ============== ============ ============
CLASS I SHARES:
Net asset value, offering and redemption
price per share of beneficial interest
outstanding ..................... -- $26.00 $36.19 $36.91 $11.27 $25.66
============== ============ ============== ============ ============
=====================
* Redemption price per share is equal to net asset value par share less any
applicable contingent deferred sales charge.
U.S.
INTERNATIONAL SHORT TERM GOVERNMENT HIGH TAX-EXEMPT
GROWTH INCOME SECURITIES INCOME YIELD BOND
FUND FUND FUND FUND FUND FUND
------------- ------------- ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
NET ASSETS CONSIST OF:
Undistributed net investment income/
(accumulated net investment loss/
distributions in excess of net
investment income) ............... $ 30,311 $ 44,057 $ 213,884 $ 32,224 $ 8,694 $ 51,442
Accumulated net realized gain/(loss) on
investments sold, futures contracts,
closed written options, forward foreign
currency contracts and foreign currency
transactions ..................... 14,193,982 (2,627,276) (70,959,179) (29,932,718) (656,442) (2,369,777)
Net unrealized appreciation/(depreciation)
of investments, foreign currency,
futures contracts, forward foreign
currency contracts and other
assets and liabilities ........... 44,966,711 (3,501,493) (16,087,943) (6,764,875) (912,104) 6,732,759
Paid-in capital ..................... 145,216,748 128,966,628 539,407,019 445,875,056 168,279,049 236,224,440
------------- ------------- ------------ ------------ ------------ ------------
Total Net Assets ................. $ 204,407,752 $ 122,881,916 $452,573,781 $409,209,687 $166,719,197 $240,638,864
============= ============= ============ ============ ============ ============
NET ASSETS:
Class A Shares ...................... $ 32,676,025 $ 22,759,718 $184,887,136 $144,365,310 $ 7,881,991 $216,290,136
============= ============= ============ ============ ============ ============
Class B Shares ...................... $ 14,645,060 $ 3,726,604 $ 56,972,325 $ 38,805,781 $ 26,341,276 $ 24,348,728
============= ============= ============ ============ ============ ============
Class I Shares ...................... $ 157,086,667 $ 96,395,594 $210,714,320 $226,038,596 $132,495,930 --
============= ============= ============ ============ ============
SHARES OUTSTANDING:
Class A Shares ...................... 2,516,862 10,062,670 17,937,473 16,330,108 870,365 29,389,401
============= ============= ============ ============ ============ ============
Class B Shares ...................... 1,153,439 1,647,729 5,530,945 4,376,272 2,896,188 3,308,468
============= ============= ============ ============ ============ ============
Class I Shares ...................... 12,116,237 42,616,756 20,437,487 25,518,660 14,658,998 --
============= ============= ============ ============ ============
CLASS A SHARES:
Net asset value per share of beneficial
interest outstanding* ........... $12.98 $2.26 $10.31 $8.84 $9.06 $7.36
============= ============= ============ ============ ============ ============
Maximum Sales Charge ............... 5.50% 3.50% 4.50% 4.50% 4.50% 4.50%
============= ============= ============ ============ ============ ============
Maximum offering price per share of
beneficial interest outstanding . $13.74 $2.34 $10.80 $9.26 $9.49 $7.71
============= ============= ============ ============ ============ ============
CLASS B SHARES:
Net asset value and offering price per
share of beneficial interest
outstanding* .................... $12.70 $2.26 $10.30 $8.87 $9.10 $7.36
============= ============= ============ ============ ============ ============
CLASS I SHARES:
Net asset value, offering and redemption
price per share of beneficial interest
outstanding ..................... $12.96 $2.26 $10.31 $8.86 $9.04 --
============= ============= ============ ============ ============
CALIFORNIA
INSURED FLORIDA
CALIFORNIA INTERMEDIATE INSURED
MUNICIPAL MUNICIPAL MUNICIPAL
FUND FUND FUND
------------ ------------ -----------
<S> <C> <C> <C>
NET ASSETS CONSIST OF:
Undistributed net investment income/
(accumulated net investment loss/
distributions in excess of net
investment income) ............... $ (432,588) $ 174 $ 27,933
Accumulated net realized gain/(loss) on
investments sold, futures contracts,
closed written options, forward foreign
currency contracts and foreign currency
transactions ..................... (7,841,419) 291,265 (2,358,008)
Net unrealized appreciation/(depreciation)
of investments, foreign currency,
futures contracts, forward foreign
currency contracts and other
assets and liabilities ........... (529,770) 405,819 204,678
Paid-in capital ..................... 393,741,809 61,594,369 18,254,360
------------ ------------ ------------
Total Net Assets ................. $384,938,032 $ 62,291,627 $ 16,128,963
============ ============ ============
NET ASSETS:
Class A Shares ...................... $247,314,184 $ 28,381,672 $ 9,918,772
============ ============ ============
Class B Shares ...................... $137,623,848 $ 33,909,955 $ 6,210,191
============ ============ ============
Class I Shares ...................... -- -- --
SHARES OUTSTANDING:
Class A Shares ...................... 23,683,712 2,758,217 1,042,714
============ ============ ============
Class B Shares ...................... 13,179,677 3,295,478 652,826
============ ============ ============
Class I Shares ...................... -- -- --
CLASS A SHARES:
Net asset value per share of beneficial
interest outstanding* ........... $10.44 $10.29 $9.51
============ ============ ============
Maximum Sales Charge ............... 4.50% 4.50% 4.50%
============ ============ ============
Maximum offering price per share of
beneficial interest outstanding . $10.93 $10.77 $9.96
============ ============ ============
CLASS B SHARES:
Net asset value and offering price per
share of beneficial interest
outstanding* .................... $10.44 $10.29 $9.51
============ ============ ============
CLASS I SHARES:
Net asset value, offering and redemption
price per share of beneficial interest
outstanding ..................... -- -- --
</TABLE>
See Notes to Financial Statements.
4 & 5
<PAGE>
STATEMENTS OF OPERATIONS
WM GROUP OF FUNDS
FOR THE SIX MONTHS ENDED APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
BOND & GROWTH & GROWTH FUND MID CAP SMALL CAP
STOCK INCOME OF THE GROWTH STOCK STOCK
FUND FUND NORTHWEST FUND FUND* FUND
------------ -------------- ------------- ------------- -------------- ------------
<S> <C> <C> <C> <C> <C> <C>
INVESTMENT INCOME:
Dividends .......................... $ 2,549,698 $ 7,442,361 $ 2,360,964 $ 1,375,394 $ 93,880 $ 311,207
Foreign withholding tax on dividend income -- -- -- (5,936) -- --
Interest ........................... 3,779,456 424,354 615,587 2,544,972 116,691 158,620
Foreign withholding tax on interest income -- -- -- -- -- --
Securities lending income (note 7) . 3,827 1,464 77,967 88,048 -- 9,467
------------ -------------- ------------- ------------- ------------- -------------
Total investment income ........ 6,332,981 7,868,179 3,054,518 4,002,478 210,571 479,294
------------ -------------- ------------- ------------- ------------- -------------
EXPENSES:
Investment advisory fee ............ 871,756 3,745,933 1,675,119 5,172,134 134,611 967,608
Custodian fees ..................... 33,044 33,412 15,554 74,392 2,074 7,123
Legal and audit fees ............... 19,513 53,873 23,358 38,972 4,738 13,246
Registration and filing fees ....... 15,444 61,777 51,472 52,135 10,971 11,734
Printing and postage fees .......... 56,610 236,209 134,537 289,722 4,319 106,847
Other .............................. 62,069 219,853 70,789 197,462 3,261 37,491
Shareholder servicing and
distribution fees:
Class A Shares .................. 276,080 848,061 506,730 433,434 194 177,432
Class B Shares .................. 328,401 1,184,460 490,608 1,972,095 606 242,706
Transfer agent fees:
Class A Shares .................. 83,806 304,660 161,421 253,142 304 135,989
Class B Shares .................. 40,811 224,726 76,165 273,081 231 65,114
Fees waived and/or expenses reimbursed
by the investment advisor and/or
distributor ..................... -- -- -- (328,130) -- --
------------ -------------- ------------- ------------- ------------- -------------
Total expenses ................. 1,787,534 6,912,964 3,205,753 8,428,439 161,309 1,765,290
Fees reduced by credits allowed
by the cusodian ................. -- (5,182) (5,298) (4,404) -- --
------------ -------------- ------------- ------------- ------------- -------------
Net expenses ................... 1,787,534 6,907,782 3,200,455 8,424,035 161,309 1,765,290
------------ -------------- ------------- ------------- ------------- -------------
NET INVESTMENT INCOME/(LOSS) 4,545,447 960,397 (145,937) (4,421,557) 49,262 (1,285,996)
------------ -------------- ------------- ------------- ------------- -------------
NET REALIZED AND UNREALIZED GAIN/
(LOSS) ON INVESTMENTS:
Realized gain/(loss) from:
Security transactions ........... 24,317,365 84,600,039 83,413,657 180,659,010 -- 32,263,397
Foward foreign currency contracts and
foreign currency transactions . -- -- -- 5,488,301 -- --
Futures contracts ............... -- -- -- -- -- --
------------ -------------- ------------- ------------- ------------- -------------
Net realized gain/(loss) on
investment transactions ..... 24,317,365 84,600,039 83,413,657 186,147,311 -- 32,263,397
------------ -------------- ------------- ------------- ------------- -------------
Change in unrealized appreciation/
(depreciation) of:
Securities ...................... (17,381,518) 41,605,973 40,363,226 150,356,931 12,577,742 12,639,503
Forward foreign currency contracts -- -- -- 8,507,690 -- --
Foreign currency, futures contracts
and other assets and liabilities .. -- -- -- 332,109 -- 347
------------ -------------- ------------- ------------- ------------- -------------
Net change in unrealized
appreciation/(depreciation)
of investment transactions .. (17,381,518) 41,605,973 40,363,226 159,196,730 12,577,742 12,639,850
------------ -------------- ------------- ------------- ------------- -------------
Net realized and unrealized gain/(loss)
on investments .................. 6,935,847 126,206,012 123,776,883 345,344,041 12,577,742 44,903,247
------------ -------------- ------------- ------------- ------------- -------------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS ....... $ 11,481,294 $127,166,409 $123,630,946 $340,922,484 $ 12,627,004 $ 43,617,251
============ ============ ============ ============ ============ ============
=======================
* The Mid Cap Stock Fund commenced operations on March 1, 2000.
U.S.
INTERNATIONAL SHORT TERM GOVERNMENT HIGH TAX-EXEMPT
GROWTH INCOME SECURITIES INCOME YIELD BOND
FUND FUND FUND FUND FUND FUND
------------ ------------- ------------ ------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
INVESTMENT INCOME:
Dividends .......................... $ 1,708,314 $ -- $ -- $ 33,053 $ 741,682 $ --
Foreign withholding tax on dividend income (122,579) -- -- -- -- --
Interest ........................... 174,521 4,931,103 16,317,807 13,338,830 5,661,197 8,078,834
Foreign withholding tax on interest income -- (3,392) -- -- (22,334) --
Securities lending income (note 7) . 16,856 644 3,347 9,984 2,205 --
------------ ------------- ------------ ------------- ------------ -------------
Total investment income ........ 1,777,112 4,928,355 16,321,154 13,381,867 6,382,750 8,078,834
------------ ------------- ------------ ------------- ------------ -------------
EXPENSES:
Investment advisory fee ............ 1,033,685 378,668 1,149,328 840,307 362,417 630,589
Custodian fees ..................... 107,679 8,577 24,182 39,447 5,233 9,702
Legal and audit fees ............... 18,606 16,504 23,414 17,857 11,258 16,716
Registration and filing fees ....... 11,590 14,978 24,855 29,728 32,645 8,932
Printing and postage fees .......... 36,613 (2,917) 47,552 58,276 4,650 32,912
Other .............................. 42,092 36,410 90,244 69,432 23,454 53,493
Shareholder servicing and
distribution fees:
Class A Shares .................. 40,753 30,683 250,966 196,221 8,219 285,743
Class B Shares .................. 67,661 21,020 327,824 206,546 121,697 125,158
Transfer agent fees:
Class A Shares .................. 62,396 54,607 159,024 140,600 4,484 71,351
Class B Shares .................. 22,736 5,094 33,571 28,535 8,289 6,231
Fees waived and/or expenses reimbursed
by the investment advisor and/or
distributor ..................... -- (228,363) (92,489) (16,323) -- (22,383)
------------ ------------ ----------- ------------ ------------ ------------
Total expenses ................. 1,443,811 335,261 2,038,471 1,610,626 582,346 1,218,444
Fees reduced by credits allowed
by the cusodian ................. (1,058) (1,055) (1,291) (5,356) (2,732) (4,186)
------------ ------------- ------------ ------------- ------------- -------------
Net expenses ................... 1,442,753 334,206 2,037,180 1,605,270 579,614 1,214,258
------------ ------------- ------------ ------------- ------------- -------------
NET INVESTMENT INCOME/(LOSS) ....... 334,359 4,594,149 14,283,974 11,776,597 5,803,136 6,864,576
------------ ------------- ------------ ------------- ------------- -------------
NET REALIZED AND UNREALIZED GAIN/
(LOSS) ON INVESTMENTS:
Realized gain/(loss) from:
Security transactions ........... 17,767,753 (808,747) (1,669,978) 289,161 (444,266) 669,943
Foward foreign currency contracts and
foreign currency transactions . (928,995) -- -- (130,200) 4,667 --
Futures contracts ............... -- 336,926 -- -- -- (189,260)
------------ ------------- ------------ ------------- ------------- -------------
Net realized gain/(loss) on
investment transactions ..... 16,838,758 (471,821) (1,669,978) 158,961 (439,599) 480,683
------------ ------------- ------------ ------------- ------------- -------------
Change in unrealized appreciation/
(depreciation) of:
Securities ...................... 20,958,323 (1,531,939) (7,587,049) (4,951,911) 1,172,191 (2,681,297)
Forward foreign currency contracts (181,253) -- -- -- 9,407 --
Foreign currency, futures contracts and
other assets and liabilities .. 114,812 (151,660) -- -- 30 348,223
------------ ------------- ------------ ------------- ------------- -------------
Net change in unrealized
appreciation/(depreciation)
of investment transactions .. 20,891,882 (1,683,599) (7,587,049) (4,951,911) 1,181,628 (2,333,074)
------------ ------------- ------------ ------------- ------------- -------------
Net realized and unrealized gain/(loss)
on investments .................. 37,730,640 (2,155,420) (9,257,027) (4,792,950) 742,029 (1,852,391)
------------ ------------- ------------ ------------- ------------- -------------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS ....... $ 38,064,999 $ 2,438,729 $ 5,026,947 $ 6,983,647 $ 6,545,165 $ 5,012,185
============ ============= ============ ============= ============= =============
CALIFORNIA
INSURED FLORIDA
CALIFORNIA INTERMEDIATE INSURED
MUNICIPAL MUNICIPAL MUNICIPAL
FUND FUND FUND
------------- ------------ ------------
<S> <C> <C> <C>
INVESTMENT INCOME:
Dividends ......................... $ -- $ -- $ --
Foreign withholding tax on dividend income -- -- --
Interest .......................... 12,306,019 1,646,570 530,676
Foreign withholding tax on interest income -- -- --
Securities lending income (note 7) -- -- --
------------ ------------ ------------
Total investment income ....... 12,306,019 1,646,570 530,676
------------ ------------ ------------
EXPENSES:
Investment advisory fee ........... 993,730 161,207 44,665
Custodian fees .................... 26,800 5,439 1,440
Legal and audit fees .............. 20,927 8,467 8,031
Registration and filing fees ...... 5,640 7,443 11,545
Printing and postage fees ......... 36,558 5,748 1,951
Other ............................. 78,106 18,292 6,252
Shareholder servicing and
distribution fees:
Class A Shares ................. 329,568 37,349 13,899
Class B Shares ................. 669,188 173,020 33,733
Transfer agent fees:
Class A Shares ................. 67,801 7,136 3,394
Class B Shares ................. 23,607 6,760 1,488
Fees waived and/or expenses reimbursed
by the investment advisor and/or
distributor ....................... -- -- --
------------ ------------- ------------
Total expenses ................ 2,251,925 430,861 126,398
Fees reduced by credits allowed
by the cusodian ................ (18,629) (5,301) (1,351)
------------ ------------- ------------
Net expenses .................. 2,233,296 425,560 125,047
------------ ------------ ------------
NET INVESTMENT INCOME/(LOSS) ...... 10,072,723 1,221,010 405,629
------------ ------------ ------------
NET REALIZED AND UNREALIZED GAIN/
(LOSS) ON INVESTMENTS:
Realized gain/(loss) from:
Security transactions .......... (3,350,861) 345,676 24,005
Foward foreign currency contracts and
foreign currency transactions -- -- --
Futures contracts .............. (395,714) (54,149) (45,636)
------------ ------------- ------------
Net realized gain/(loss) on
investment transactions .... (3,746,575) 291,527 (21,631)
------------ ------------- ------------
Change in unrealized appreciation/
(depreciation) of:
Securities ..................... 3,334,401 (305,853) (135,284)
Forward foreign currency contracts -- -- --
Foreign currency, futures contracts and
other assets and liabilities . 4 66,991 56,185 (18,048)
------------ ------------- ------------
Net change in unrealized
appreciation/(depreciation)
of investment transactions . 3,801,392 (249,668) (153,332)
------------ ------------- ------------
Net realized and unrealized gain/(loss)
on investments ................. 54,817 41,859 (174,963)
------------ ------------- ------------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS ...... $ 10,127,540 $ 1,262,869 $ 230,666
============ ============= ============
</TABLE>
See Notes to Financial Statements.
6 & 7
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
WM GROUP OF FUNDS
FOR THE SIX MONTHS ENDED APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
BOND & GROWTH & GROWTH FUND MID CAP SMALL CAP
STOCK INCOME OF THE GROWTH STOCK STOCK
FUND FUND NORTHWEST FUND FUND* FUND
------------- -------------- ------------ ------------- ------------- ------------
<S> <C> <C> <C> <C> <C> <C>
Net investment income/(loss) ....... $ 4,545,447 $ 960,397 $ (145,937) $ (4,421,557) $ 49,262 $ (1,285,996)
Net realized gain/(loss) on
investment transactions ......... 24,317,365 84,600,039 83,413,657 186,147,311 -- 32,263,397
Net change in unrealized appreciation/
(depreciation) of investment
transactions ................... (17,381,518) 41,605,973 40,363,226 159,196,730 12,577,742 12,639,850
------------- -------------- ------------ -------------- ------------- ------------
Net increase in net assets resulting
from operations ................. 11,481,294 127,166,409 123,630,946 340,922,484 12,627,004 43,617,251
Distributions to shareholders from:
Net investment income:
Class A Shares ................ (3,722,275) (448,541) -- -- -- --
Class B Shares ................ (829,099) -- -- -- -- --
Class I Shares ................ -- (1,024,675) -- -- -- --
Net realized gains on investments:
Class A Shares ................ (7,152,213) (23,246,859) (43,607,604) (31,337,274) -- (12,252,014)
Class B Shares ................ (2,218,969) (7,955,993) (10,627,788) (33,030,226) -- (4,148,715)
Class I Shares ................ -- (15,816,999) (823,473) (50,642,639) -- --
Net increase/(decrease) in net assets
from Fund share transactions:
Class A Shares ................ (35,467,149) (65,167,898) 46,619,901 81,667,315 831,497 10,499,435
Class B Shares ................ (17,648,561) (1,029,685) 20,948,437 214,163,196 696,763 16,981,401
Class I Shares ................ -- 125,416,301 84,437,545 (56,251,363) 114,920,610 85,862,055
------------- -------------- ------------ -------------- ------------- -----------
Net increase/(decrease) in net assets (55,556,972) 137,892,060 220,577,964 465,491,493 129,075,874 140,559,413
NET ASSETS:
Beginning of period ................ 317,231,163 1,400,679,958 422,740,121 853,237,152 -- 121,098,972
------------- -------------- ------------ -------------- ------------- ------------
End of period ...................... $261,674,191 $1,538,572,018 $643,318,085 $1,318,728,645 $ 129,075,874 $261,658,385
============= ============== ============ ============== ============= ============
Undistributed net investment income/
(accumulated net investment loss/
distributions in excess of net
investment income) at end of period $ 1,067,949 $ (512,819) $ (145,937) $ (5,416,926) $ 49,262 $ (1,285,996)
============= ============== ============ ============== ============= ============
========================
* The Mid Cap Stock Fund commenced operations on March 1, 2000.
U.S.
INTERNATIONAL SHORT TERM GOVERNMENT HIGH TAX-EXEMPT
GROWTH INCOME SECURITIES INCOME YIELD BOND
FUND FUND FUND FUND FUND FUND
------------ ------------- ------------ ------------ ------------ -------------
<S> <C> <C> <C> <C> <C> <C>
Net investment income/(loss) ....... $ 334,359 $ 4,594,149 $ 14,283,974 $ 11,776,597 $ 5,803,136 $ 6,864,576
Net realized gain/(loss) on
investment transactions ......... 16,838,758 (471,821) (1,669,978) 158,961 (439,599) 480,683
Net change in unrealized appreciation/
(depreciation) of investment
transactions ................... 20,891,882 (1,683,599) (7,587,049) (4,951,911) 1,181,628 (2,333,074)
------------ ------------- ------------- ------------ ------------ -------------
Net increase in net assets resulting
from operations ................. 38,064,999 2,438,729 5,026,947 6,983,647 6,545,165 5,012,185
Distributions to shareholders from:
Net investment income:
Class A Shares ................ (354,984) (680,108) (6,076,658) (5,469,443) (321,128) (6,272,127)
Class B Shares ................ (68,268) (104,829) (1,749,137) (1,286,857) (1,105,495) (592,449)
Class I Shares ................ (3,271,849) (3,814,226) (6,244,295) (5,043,064) (4,377,227) --
Net realized gains on investments:
Class A Shares ................ -- -- -- -- -- --
Class B Shares ................ -- -- -- -- -- --
Class I Shares ................ -- -- -- -- -- --
Net increase/(decrease) in net assets
from Fund share transactions:
Class A Shares ................ (743,900) (3,966,614) (32,673,829) (25,226,959) 1,978,188 (29,846,697)
Class B Shares ................ 1,715,248 (813,958) (14,371,351) (3,290,928) 4,770,303 (535,387)
Class I Shares ................ (34,263,050) (40,788,307) 29,611,769 151,465,935 87,480,380 --
------------ ------------- ------------- ------------ ------------ -------------
Net increase/(decrease) in net assets 1,078,196 (47,729,313) (26,476,554) 118,132,331 94,970,186 (32,234,475)
NET ASSETS:
Beginning of period ................ 203,329,556 170,611,229 479,050,335 291,077,356 71,749,011 272,873,339
------------ ------------- ------------- ------------ ------------ -------------
End of period ...................... $204,407,752 $ 122,881,916 $ 452,573,781 $409,209,687 $166,719,197 $ 240,638,864
============ ============ ============= ============ ============ =============
Undistributed net investment income/
(accumulated net investment loss/
distributions in excess of net
investment income) at end of period $ 30,311 $ 44,057 $ 213,884 $ 32,224 $ 8,694 $ 51,442
============ ============= ============= ============ ============ =============
CALIFORNIA
INSURED FLORIDA
CALIFORNIA INTERMEDIATE INSURED
MUNICIPAL MUNICIPAL MUNICIPAL
FUND FUND FUND
------------ ------------ ------------
<S> <C> <C> <C>
Net investment income/(loss) ....... $ 10,072,723 $ 1,221,010 $ 405,629
Net realized gain/(loss) on ........
investment transactions ......... (3,746,575) 291,527 (21,631)
Net change in unrealized appreciation/
(depreciation) of investment
transactions ................... 3,801,392 (249,668) (153,332)
------------ ------------- -------------
Net increase in net assets resulting
from operations ................. 10,127,540 1,262,869 230,666
Distributions to shareholders from:
Net investment income:
Class A Shares ................ (7,017,771) (626,285) (268,149)
Class B Shares ................ (3,054,952) (594,725) (137,480)
Class I Shares ................ -- -- --
Net realized gains on investments:
Class A Shares ................ -- (76,974) --
Class B Shares ................ -- (86,506) --
Class I Shares ................ -- -- --
Net increase/(decrease) in net assets
from Fund share transactions:
Class A Shares ................ (36,663,499) (2,816,204) (1,985,446)
Class B Shares ................ 3,776,618 (1,523,622) (998,099)
Class I Shares ................ -- -- --
------------ ------------- -------------
Net increase/(decrease) in net assets (32,832,064) (4,461,447) ( 3,158,508)
NET ASSETS:
Beginning of period ................ 417,770,096 66,753,074 19,287,471
------------ ------------- -------------
End of period ...................... $384,938,032 $ 62,291,627 $ 16,128,963
============ ============= =============
Undistributed net investment income/
(accumulated net investment loss/
distributions in excess of net
investment income) at end of period $ (432,588) $ 174 $ 27,933
============ ============= =============
</TABLE>
8 & 9
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS (CONTINUED)
WM GROUP OF FUNDS
FOR THE YEAR ENDED OCTOBER 31, 1999
<TABLE>
<CAPTION>
BOND & GROWTH & GROWTH FUND SMALL CAP INTERNATIONAL
STOCK INCOME OF THE GROWTH STOCK GROWTH
FUND FUND NORTHWEST FUND FUND FUND
------------ -------------- -------------- ------------ ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Net investment income/(loss) ....... $ 8,790,002 $ 3,761,794 $ (1,305,535) $ (4,689,670) $ (1,688,508) $ 843,589
Net realized gain/(loss) on investment
transactions .................... 12,594,357 55,169,792 64,144,998 158,802,856 20,786,767 13,555,859
Net change in unrealized appreciation/
(depreciation) of investment
transactions .................... 5,658,178 185,462,770 94,783,487 160,224,429 23,844,762 30,732,015
------------ -------------- -------------- ------------ ------------- -------------
Net increase/(decrease) in net assets
resulting from operations ....... 27,042,537 244,394,356 157,622,950 314,337,615 42,943,021 45,131,463
Distributions to shareholders from:
Net investment income:
Class A Shares ................ (7,559,965) (2,602,496) -- -- -- (910,893)
Class B Shares ................ (1,559,681) -- -- -- -- (103,845)
Class S Shares ................ (644) -- -- -- -- (224,002)
Class I Shares ................ -- (1,790,653) -- -- -- (3,219,638)
Distributions in excess of net investment
income:
Class A Shares ................ -- -- -- -- -- --
Class B Shares ................ -- -- -- -- -- --
Class S Shares ................ -- -- -- -- -- --
Class I Shares ................ -- -- -- -- -- --
Net realized gains on investments:
Class A Shares ................ (803,912) (121,462) -- (10,715,680) (14,838,773) (372,771)
Class B Shares ................ (208,365) -- -- (4,454,756) (3,867,191) (45,270)
Class S Shares ................ (108) -- -- (1,204,673) (743,226) (95,194)
Class I Shares ................ -- (54,140) -- (12,516,104) (4,308,281) (1,275,498)
Net increase/(decrease) in net assets
from Fund share transactions:
Class A Shares ................ (70,804,319) 30,439,066 (35,387,914) 8,149,895 9,931,687 (9,815,055)
Class B Shares ................ (2,071,336) 83,250,940 4,440,907 133,358,773 (7,912,489) 6,184,898
Class S Shares ................ (31,483) (10,388,888) -- (5,835,817) (1,239,975) (8,285,762)
Class I Shares ................ -- 240,602,040 5,831,437 156,967,682 (25,943,679) 36,683,497
------------ -------------- -------------- ------------ ------------- -------------
Net increase/(decrease) in net assets (55,997,276) 583,728,763 132,507,380 578,086,935 (5,978,906) 63,651,930
NET ASSETS:
Beginning of period ................ 373,228,439 816,951,195 290,232,741 275,150,217 127,077,878 139,677,626
------------ -------------- -------------- ------------ ------------- -------------
End of period ...................... $317,231,163 $1,400,679,958 $422,740,121 $853,237,152 $ 121,098,972 $203,329,556
============ ============== ============ ============ ============= ============
Undistributed net investment income/
(accumulated net investment loss/
distributions in excess of net
investment income) at end of year $ 1,073,876 $ -- $ -- $ (995,369) $ -- $ 3,391,053
============ ============== ============ ============ ============= ============
U.S.
SHORT TERM GOVERNMENT HIGH TAX-EXEMPT CALIFORNIA
INCOME SECURITIES INCOME YIELD BOND MUNICIPAL
FUND FUND FUND FUND FUND FUND
------------ ------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
Net investment income/(loss) ....... $ 7,175,214 $ 23,601,734 $ 19,831,823 $ 4,584,562 $ 15,653,997 $ 18,878,860
Net realized gain/(loss) on investment
transactions .................... (389,404) (363,292) 543,055 (219,033) (1,485,288) (4,085,194)
Net change in unrealized appreciation/
(depreciation) of investment
transactions .................... (2,356,159) (18,492,115) (15,134,079) (425,579) (25,049,570) (31,508,821)
------------ ------------ ------------ ------------ ------------ ------------
Net increase/(decrease) in net assets
resulting from operations ....... 4,429,651 4,746,327 5,240,799 3,939,950 (10,880,861) (16,715,155)
Distributions to shareholders from:
Net investment income:
Class A Shares ................ (3,192,387) (15,781,217) (15,130,951) (953,604) (14,755,966) (15,504,606)
Class B Shares ................ (179,144) (2,500,924) (2,350,704) (1,025,321) (956,931) (3,858,984)
Class S Shares ................ (41,351) (145,020) (58,122) (1,605) (17) (157)
Class I Shares ................ (3,800,419) (4,534,753) (2,290,516) (2,604,114) (45) (40)
Distributions in excess of net investment
income:
Class A Shares ................ -- (143,587) -- -- -- --
Class B Shares ................ -- (22,755) -- -- -- --
Class S Shares ................ -- (1,319) -- -- -- --
Class I Shares ................ -- (41,260) -- -- -- --
Net realized gains on investments:
Class A Shares ................ -- -- -- (70,737) -- (1,424,459)
Class B Shares ................ -- -- -- (24,411) -- (278,985)
Class S Shares ................ -- -- -- (126) -- (36)
Class I Shares ................ -- -- -- (19,594) -- (6)
Net increase/(decrease) in net assets
from Fund share transactions:
Class A Shares ................ (4,480,357) (31,267,391) (30,452,925) (5,334,713) (28,830,750) 23,495,259
Class B Shares ................ 1,125,254 46,467,913 10,384,366 18,703,424 9,791,011 94,783,391
Class S Shares ................ (911,044) (6,157,509) (1,597,339) (25,952) (1,317) (6,066)
Class I Shares ................ 138,773,018 148,054,667 70,649,258 44,142,123 (1,087) (1,139)
------------ ------------ ------------ ------------ ------------ ------------
Net increase/(decrease) in net assets 131,723,221 138,673,172 34,393,866 56,725,320 (45,635,963) 80,489,017
NET ASSETS:
Beginning of period ................ 38,888,008 340,377,163 256,683,490 15,023,691 318,509,302 337,281,079
------------ ------------ ------------ ------------ ------------ ------------
End of period ...................... $170,611,229 $479,050,335 $291,077,356 $ 71,749,011 $272,873,339 $417,770,096
============ ============ ============ ============ ============ ============
Undistributed net investment income/
(accumulated net investment loss/
distributions in excess of net
investment income) at end of year $ 49,071 $ -- $ 54,991 $ 9,408 $ 51,442 $ (432,588)
============ ============ ============ ============ ============ ============
CALIFORNIA
INSURED FLORIDA
INTERMEDIATE INSURED
MUNICIPAL MUNICIPAL
FUND FUND
------------ ------------
<S> <C> <C>
Net investment income/(loss) ....... $ 2,532,518 $ 959,178
Net realized gain/(loss) on investment
transactions .................... 163,654 (182,326)
Net change in unrealized appreciation/
(depreciation) of investment
transactions .................... (3,715,242) (1,726,040)
------------ ------------
Net increase/(decrease) in net assets
resulting from operations ....... (1,019,070) (949,188)
Distributions to shareholders from:
Net investment income:
Class A Shares ................ (1,542,848) (672,564)
Class B Shares ................ (998,452) (289,752)
Class S Shares ................ (34) (24)
Class I Shares ................ (33) (42)
Distributions in excess of net investment
income:
Class A Shares ................ -- --
Class B Shares ................ -- --
Class S Shares ................ -- --
Class I Shares ................ -- --
Net realized gains on investments:
Class A Shares ................ (551,842) --
Class B Shares ................ (380,181) --
Class S Shares ................ (26) --
Class I Shares ................ (17) --
Net increase/(decrease) in net assets
from Fund share transactions:
Class A Shares ................ (3,869,985) (2,585,525)
Class B Shares ................ 13,625,253 1,916,021
Class S Shares ................ (1,171) (495)
Class I Shares ................ (1,133) (1,130)
------------ ------------
Net increase/(decrease) in net assets 5,260,461 (2,582,699)
NET ASSETS:
Beginning of period ................ 61,492,613 21,870,170
------------ ------------
End of period ...................... $ 66,753,074 $ 19,287,471
============ ============
Undistributed net investment income/
(accumulated net investment loss/
distributions in excess of net
investment income) at end of year $ 174 $ 27,933
============ ============
</TABLE>
10 & 11
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS -- CAPITAL STOCK ACTIVITY
WM GROUP OF FUNDS
<TABLE>
<CAPTION>
GROWTH FUND
BOND & STOCK FUND GROWTH & INCOME FUND OF THE NORTHWEST (A)
------------------------------ ------------------------------ ----------------------------
SIX MONTHS SIX MONTHS SIX MONTHS
ENDED ENDED ENDED
04/30/00 YEAR ENDED 04/30/00 YEAR ENDED 04/30/00 YEAR ENDED
(UNAUDITED) 10/31/99 (UNAUDITED) 10/31/99 (UNAUDITED) 10/31/99
-------------- -------------- -------------- -------------- ------------ --------------
AMOUNT
<S> <C> <C> <C> <C> <C> <C>
CLASS A:
Sold ............................ $ 7,021,935 $ 19,134,660 $ 45,634,276 $ 190,640,822 $ 38,959,319 $ 68,805,400
Issued in exchange for Class A shares
of Griffin Growth & Income Fund -- -- -- 281,276,085 -- --
Issued as reinvestment of dividends 10,387,701 7,875,442 23,174,508 2,640,934 42,754,720 --
Redemption in-kind (Note 10) .... -- -- -- (166,275,618) -- (990,005)
Redeemed ........................ (52,876,785) (97,814,421) (133,976,682) (277,843,157) (35,094,138) (103,203,309)
-------------- -------------- -------------- -------------- ------------ --------------
Net increase/(decrease) $ (35,467,149) $ (70,804,319) $ (65,167,898) $ 30,439,066 $ 46,619,901 $ (35,387,914)
============== ============== ============== ============== ============ =============
CLASS B:
Sold ........................... $ 3,400,857 $ 20,485,600 $ 29,890,542 $ 58,608,032 $ 18,426,286 $ 15,268,007
Converted from Class S shares of Fund -- 42,306 -- 11,602,915 -- 4,417
Issued in exchange for Class B shares
of Griffin Growth & Income Fund -- -- -- 50,553,133 -- --
Issued as reinvestment of dividends 2,995,975 1,727,449 7,821,936 -- 10,490,966 --
Redeemed ....................... (24,045,393) (24,326,691) (38,742,163) (37,513,140) (7,968,815) (10,831,517)
-------------- -------------- -------------- -------------- ------------ --------------
Net increase/(decrease) $(17,648,561) $ (2,071,336) $ (1,029,685) $ 83,250,940 $ 20,948,437 $ 4,440,907
============== ============== ============== ============== ============ =============
CLASS S:
Sold ........................... -- $ 13,604 -- $ 4,985,68 -- $ 3,584
Issued as reinvestment of dividends -- 552 -- -- -- --
Converted to Class B shares of Fund -- (42,306) -- (11,602,915) -- (3,584)
Redeemed ....................... -- (3,333) -- (3,771,661) -- --
-------------- -------------- -------------
Net decrease ................... -- $ (31,483) -- $ (10,388,888) -- --
============== ============== =============
CLASS I:
Sold ........................... -- -- $ 126,204,223 $ 88,357,264 $ 83,614,072 $ 4,841,432
Contribution in-kind (Note 10) -- -- -- 166,275,618 -- 990,005
Issued as reinvestment of dividends -- -- 16,841,674 1,844,793 823,473 --
Redeemed ....................... -- -- (17,629,596) (15,875,635) -- --
--------------- -------------- ----------- -------------
Net increase ................... -- -- $ 125,416,301 $ 240,602,040 $ 84,437,545 $ 5,831,437
=============== ============== ============ =============
SHARES
CLASS A:
Sold ........................... 488,029 1,291,022 1,826,112 9,361,521 1,116,150 2,446,781
Issued in exchange for Class A shares
of Griffin Growth & Income Fund -- -- -- 12,108,922 -- --
Issued as reinvestment of dividends 727,141 537,940 942,163 111,449 1,434,241 --
Redemption in-kind (Note 10) ... -- -- -- (6,291,170) -- (30,192)
Redeemed ....................... (3,699,996) (6,577,515) (5,430,191) ( 11,718,860) (1,021,812) (3,770,477)
-------------- -------------- -------------- -------------- ------------ --------------
Net increase/(decrease) ........ (2,484,826) (4,748,553) (2,661,916) 3,571,862 1,528,579 (1,353,888)
============== ============== ============== ============== ============ =============
CLASS B:
Sold ........................... 238,618 1,407,652 1,230,490 2,654,554 564,925 547,485
Converted from Class S shares of Fund -- 2,669 -- 445,580 -- 140
Issued in exchange for Class B shares
of Griffin Growth & Income Fund -- -- -- 2,204,430 -- --
Issued as reinvestment of dividends 210,733 118,539 324,535 -- 370,837 --
Redeemed ....................... (1,689,952) (1,672,620) (1,598,693) (1,604,781) (245,069) (410,513)
-------------- -------------- -------------- -------------- ------------ --------------
Net increase/(decrease) ........ (1,240,601) (143,760) (43,668) 3,699,783 690,693 137,112
============== ============== ============== ============== ============ =============
CLASS S:
Sold ........................... -- 953 -- 31,900 -- 144
Issued as reinvestment of dividends -- 38 -- -- -- --
Converted to Class B shares of Fund -- (2,698) -- (445,409) -- (144)
Redeemed ....................... -- (921) -- (205,259) -- --
-------------- -------------- -------------
Net decrease ................... -- (2,628) -- (618,768) -- --
============== ============== =============
CLASS I:
Sold ........................... -- -- 5,138,046 3,785,718 2,421,504 160,298
Contribution in-kind (Note 10) -- -- -- 6,291,170 -- 30,183
Issued as reinvestment of dividends -- -- 682,979 77,193 27,614 --
Redeemed ....................... -- -- (720,472) (685,001) -- --
-------------- -------------- ------------ -------------
Net increase ................... -- -- 5,100,553 9,469,080 2,449,118 190,481
============== ============== ============ =============
==========================
<FN>
(a) Formerly Northwest Fund.
</FN>
</TABLE>
See Notes to Financial Statements.
12
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS -- CAPITAL STOCK ACTIVITY
WM GROUP OF FUNDS
<TABLE>
<CAPTION>
MID CAP SMALL CAP
GROWTH FUND STOCK FUND (A) STOCK FUND (B)
------------------------------ ------------------------------ ----------------------------
SIX MONTHS PERIOD SIX MONTHS
ENDED ENDED ENDED
04/30/00 YEAR ENDED 04/30/00 04/30/00 YEAR ENDED
(UNAUDITED) 10/31/99 (UNAUDITED) (UNAUDITED) 10/31/99
-------------- -------------- -------------- -------------- ------------ --------------
<S> <C> <C> <C> <C> <C>
AMOUNT
CLASS A:
Sold .......................... $ 306,689,228 $ 337,963,924 $ 837,613 $ 34,495,209 $ 66,778,793
Issued in exchange for Class A shares
of Griffin Growth Fund ...... -- 82,274,308 -- -- --
Issued as reinvestment of dividends 30,565,115 10,484,224 -- 12,107,471 14,642,298
Redemption in-kind (Note 10) .. -- (105,326,502) -- -- --
Redeemed ...................... (255,587,028) (317,246,059) (6,116) (36,103,245) (71,489,404)
-------------- -------------- ------------- ------------ --------------
Net increase .................. $ 81,667,315 $ 8,149,895 $ 831,497 $ 10,499,435 $ 9,931,687
============== ============== ============= ============ =============
CLASS B:
Sold .......................... $ 218,301,692 $ 135,842,242 $ 718,029 $ 18,518,002 $ 1,953,827
Converted from Class S shares of Fund -- 15,635,767 -- -- 4,813,233
Issued in exchange for Class B shares
of Griffin Growth Fund ...... -- 6,593,119 -- -- --
Issued as reinvestment of dividends 32,310,364 4,359,229 -- 4,070,111 3,764,240
Redeemed ...................... (36,448,860) (29,071,584) (21,266) (5,606,712) (18,443,789)
-------------- -------------- ------------- ------------ --------------
Net increase/(decrease) ....... $ 214,163,196 $133,358,773 $ 696,763 $ 16,981,401 $ (7,912,489)
============== ============== ============= ============ =============
CLASS S:
Sold .......................... -- $ 12,319,106 -- -- $ 3,711,234
Issued as reinvestment of dividends -- 1,200,444 -- -- 742,277
Converted to Class B shares of Fund -- (15,635,767) -- -- (4,813,233)
Redeemed ...................... -- (3,719,600) -- -- ( 880,253)
-------------- -------------
Net decrease .................. -- $ (5,835,817) -- -- $ (1,239,975)
============== =============
CLASS I:
Sold .......................... $ 30,133,440 $ 78,054,512 $ 114,920,610 $ 85,862,055 $ 15,296,619
Contribution in-kind (Note 10) -- 105,326,502 -- -- --
Issued as reinvestment of dividends 50,642,639 12,516,104 -- -- 4,308,281
Redeemed ...................... (137,027,442) (38,929,436) -- -- (45,548,579)
-------------- -------------- ------------- ------------ --------------
Net increase/(decrease) ....... $ (56,251,363) $156,967,682 $ 114,920,610 $ 85,862,055 $ (25,943,679)
============== ============== ============= ============ =============
SHARES
CLASS A:
Sold .......................... 8,647,638 14,438,655 78,524 1,124,313 2,541,226
Issued in exchange for Class A shares
of Griffin Growth Fund ...... -- 3,550,898 -- -- --
Issued as reinvestment of dividends 1,004,132 562,458 -- 581,821 951,416
Redemption in-kind (Note 10) .. -- (3,702,162) -- -- --
Redeemed ...................... (7,179,461) (12,699,261) (584) (1,218,358) (4,241,475)
-------------- -------------- ------------- ------------ -------------
Net increase/(decrease) ....... 2,472,309 2,150,588 77,940 487,776 (748,833)
============== ============== ============= ============ =============
CLASS B:
Sold .......................... 6,432,221 5,530,902 67,030 611,985 120,310
Converted from Class S shares of Fund -- 580,608 -- -- 265,338
Issued in exchange for Class B shares
of Griffin Growth Fund ...... -- 297,523 -- -- --
Issued as reinvestment of dividends 1,122,868 244,078 -- 207,637 255,722
Redeemed ...................... (1,067,242) (964,850) (1,982) (203,923) (499,868)
-------------- -------------- ------------- ------------ -------------
Net increase .................. 6,487,847 5,688,261 65,048 615,699 141,502
============== ============== ============= ============ =============
CLASS S:
Sold .......................... -- 24,052 -- -- 35,487
Issued as reinvestment of dividends -- 67,214 -- -- 50,426
Converted to Class B shares of Fund -- (581,471) -- -- (263,688)
Redeemed ...................... -- (195,203) -- -- (61,736)
-------------- -------------
Net decrease .................. -- (685,408) -- -- (239,511)
============== =============
CLASS I:
Sold .......................... 889,009 2,949,912 11,309,214 2,984,343 887,057
Contribution in-kind (Note 10) -- 3,702,162 -- -- --
Issued as reinvestment of dividends 1,647,451 666,459 -- -- 277,774
Redeemed ...................... (3,643,338) (1,143,440) -- -- (1,938,470)
-------------- -------------- ------------- ------------ -------------
Net increase/(decrease) ....... (1,106,878) 6,175,093 11,309,214 2,984,343 (773,639)
============== ============== ============ ============ =============
========================
(a) The Mid Cap Stock Fund commenced operations on March 1, 2000.
(b) Formerly Emerging Growth Fund.
</TABLE>
See Notes to Financial Statements.
13
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS -- CAPITAL STOCK ACTIVITY
WM GROUP OF FUNDS
<TABLE>
<CAPTION>
INTERNATIONAL SHORT TERM U.S. GOVERNMENT
GROWTH FUND INCOME FUND (A) SECURITIES FUND
------------------------------ ------------------------------ ----------------------------
SIX MONTHS SIX MONTHS SIX MONTHS
ENDED ENDED ENDED
04/30/00 YEAR ENDED 04/30/00 YEAR ENDED 04/30/00 YEAR ENDED
(UNAUDITED) 10/31/99 (UNAUDITED) 10/31/99 (UNAUDITED) 10/31/99
-------------- -------------- -------------- -------------- ------------ -------------
<S> <C> <C> <C> <C> <C> <C>
AMOUNT
CLASS A:
Sold ........................ $ 15,995,713 $ 53,460,353 $ 2,615,517 $ 27,192,755 $ 6,345,867 $ 53,790,954
Issued in exchange for Class A shares
of Griffin U.S. Government Income
Fund ...................... -- -- -- -- -- 100,567,406
Issued in exchange for Class A shares
of Griffin Short-Term Bond Fund -- -- -- 91,614,250 -- --
Issued as reinvestment of dividends 348,185 1,259,502 491,000 2,500,289 4,230,756 11,105,283
Redemption in-kind (Note 10) -- (43,975,563) -- (75,284,631) -- (89,139,223)
Redeemed .................... (17,087,798) (20,559,347) (7,073,131) (50,503,020) (43,250,452) (107,591,811)
-------------- -------------- -------------- -------------- ------------ -------------
Net decrease ................ $ (743,900) $ (9,815,055) $ (3,966,614) $ ( 4,480,357) $(32,673,829) $ (31,267,391)
============== ============== ============== ============== ============ =============
CLASS B:
Sold ........................ $ 3,300,558 $ 772,204 $ 714,152 $ 1,720,335 $ 9,678,572 $ 51,797,931
Converted from Class S shares of Fund -- 6,848,720 -- 1,258,939 -- 3,829,707
Issued in exchange for Class B shares
of Griffin U.S. Government Income
Fund ...................... -- -- -- -- -- 5,798,109
Issued in exchange for Class B shares
of Griffin Short-Term Bond Fund -- -- -- 419,976 -- --
Issued as reinvestment of dividends 67,620 145,074 83,908 140,363 1,375,566 2,005,674
Redeemed .................... (1,652,930) (1,581,100) (1,612,018) (2,414,359) (25,425,489) (16,963,508)
-------------- -------------- -------------- -------------- ------------ -------------
Net increase/(decrease) ..... $ 1,715,248 $ 6,184,898 $ (813,958) $ 1,125,254 $(14,371,351) $ 46,467,913
============== ============== ============== ============== ============ =============
CLASS S:
Sold ........................ -- $ 369,294 -- $ 983,060 -- $ 77,730
Issued as reinvestment of dividends -- 316,165 -- 31,859 -- 128,626
Converted to Class B shares of Fund -- (6,848,720) -- (1,258,939) -- (3,829,707)
Redeemed .................... -- (2,122,501) -- (667,024) -- (2,534,158)
-------------- -------------- -------------
Net decrease ................ -- $ (8,285,762) -- $ (911,044) -- (6,157,509)
============== ============== =============
CLASS I:
Sold ........................ $ 22,255,241 $ 27,683,346 $ 6,263,803 $ 73,030,498 $ 46,283,395 $ 83,493,525
Contribution in-kind (Note 10) -- 43,975,563 -- 75,284,631 -- 89,139,223
Issued as reinvestment of dividends 3,271,849 4,495,136 3,814,175 3,705,635 6,244,217 4,456,402
Redeemed .................... (59,790,140) (39,470,548) (50,866,285) (13,247,746) (22,915,843) (29,034,483)
-------------- -------------- -------------- -------------- ------------ -------------
Net increase/(decrease) ..... $ (34,263,050) $ 36,683,497 $ (40,788,307) $ 138,773,018 $ 29,611,769 $148,054,667
============== ============== ============== ============== ============ =============
SHARES
CLASS A:
Sold ........................ 1,228,247 5,422,990 1,151,249 11,722,723 613,134 4,937,112
Issued in exchange for Class A shares
of Griffin U.S. Government Income
Fund ...................... -- -- -- -- -- 9,303,183
Issued in exchange for Class A shares
of Griffin Short-Term Bond Fund -- -- -- 39,480,745 -- --
Issued as reinvestment of dividends 27,788 140,440 215,946 1,079,642 409,066 1,035,779
Redemption in-kind (Note 10) -- (4,281,944) -- (32,590,750) -- (8,393,524)
Redeemed .................... (1,308,615) (2,112,930) (3,109,572) (21,824,751) (4,175,325) (10,051,648)
-------------- -------------- -------------- -------------- ------------ -------------
Net decrease ................ (52,580) (831,444) (1,742,377) (2,132,391) (3,153,125) (3,169,098)
============== ============== ============== ============== ============ =============
CLASS B:
Sold ........................ 257,630 81,463 313,702 667,980 931,691 4,818,623
Converted from Class S shares of Fund -- 680,111 -- 544,995 -- 361,031
Issued in exchange for Class B shares
of Griffin U.S. Government Income
Fund ...................... -- -- -- -- -- 536,862
Issued in exchange for Class B shares
of Griffin Short-Term Bond Fund -- -- -- 180,972 -- --
Issued as reinvestment of dividends 5,502 16,430 36,900 60,706 133,042 188,329
Redeemed .................... (130,737) (164,531) (708,749) (1,043,437) (2,462,526) (1,595,804)
-------------- -------------- -------------- -------------- ------------ -------------
Net increase/(decrease) ..... 132,395 613,473 (358,147) 411,216 (1,397,793) 4,309,041
============== ============== ============== ============== ============ =============
CLASS S:
Sold ........................ -- 39,598 -- 420,173 -- 7,136
Issued as reinvestment of dividends -- 35,483 -- 13,694 -- 11,851
Converted to Class B shares of Fund -- (672,762) -- (544,995) -- (360,613)
Redeemed .................... -- (249,525) -- (212,999) -- (145,946)
-------------- -------------- -------------
Net decrease ................ -- (847,206) -- (324,127) -- (487,572)
============== ============== =============
CLASS I:
Sold ........................ 1,740,110 2,887,901 2,741,259 31,460,394 4,477,865 7,793,119
Contribution in-kind (Note 10) -- 4,281,944 -- 32,590,750 -- 8,393,524
Issued as reinvestment of dividends 261,957 502,812 1,677,148 1,608,705 603,828 422,276
Redeemed .................... (4,549,209) (4,171,564) (22,416,965) (5,739,003) (2,219,205) (2,668,080)
-------------- -------------- -------------- -------------- ------------ -------------
Net increase/(decrease) ..... (2,547,142) 3,501,093 (17,998,558) 59,920,846 2,862,488 13,940,839
============== ============== ============== ============== ============ =============
==========================
<FN>
(a) Formerly Short Term High Quality Bond Fund.
</FN>
</TABLE>
See Notes to Financial Statements.
14
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS -- CAPITAL STOCK ACTIVITY
WM GROUP OF FUNDS
<TABLE>
<CAPTION>
INCOME FUND HIGH YIELD FUND TAX-EXEMPT BOND FUND
----------------------------- ---------------------------- ------------------------
SIX MONTHS SIX MONTHS SIX MONTHS
ENDED ENDED ENDED
04/30/00 YEAR ENDED 04/30/00 YEAR ENDED 04/30/00 YEAR ENDED
(UNAUDITED) 10/31/99 (UNAUDITED) 10/31/99 (UNAUDITED) 10/31/99
-------------- -------------- -------------- -------------- ------------ -------------
<S> <C> <C> <C> <C> <C> <C>
AMOUNT
CLASS A:
Sold ........................ $ 4,660,801 $ 31,599,173 $ 3,400,175 $ 24,114,009 $ 3,881,003 $ 10,218,537
Issued in exchange for Class A shares
of Griffin Bond Fund ...... -- 88,322,084 -- -- -- --
Issued in exchange for Class A shares
of Griffin Municipal Bond Fund -- -- -- -- -- 21,016,760
Issued as reinvestment of dividends 3,594,549 10,268,480 135,129 678,585 4,360,224 10,215,393
Redemption in-kind (Note 10) -- (50,387,989) -- (18,189,328) -- --
Redeemed .................... (33,482,309) (110,254,673) (1,557,116) (11,937,979) (38,087,924) (70,281,440)
-------------- -------------- -------------- -------------- ------------ -------------
Net increase/(decrease) ..... $ (25,226,959) $ (30,452,925) $ 1,978,188 $ ( 5,334,713) $(29,846,697) $ (28,830,750)
============== ============== ============== ============== ============ =============
CLASS B:
Sold ........................ $ 5,828,042 $ 19,545,920 $ 8,003,402 $ 19,815,931 $ 3,191,492 $ 12,702,216
Converted from Class S shares of Fund -- 1,322,036 -- 23,493 -- --
Issued in exchange for Class B shares
of Griffin Bond Fund ...... -- 573,322 -- -- -- --
Issued in exchange for Class B shares
of Griffin Municipal Bond Fund -- -- -- -- -- 565,210
Issued as reinvestment of dividends 833,543 1,576,240 530,452 538,148 423,806 733,907
Redeemed .................... (9,952,513) (12,633,152) (3,763,551) (1,674,148) (4,150,685) (4,210,322)
-------------- -------------- -------------- -------------- ------------ -------------
Net increase/(decrease) ..... $ (3,290,928) $ 10,384,366 $ 4,770,303 $ 18,703,424 $ (535,387) $ 9,791,011
============== ============== ============== ============== ============ =============
CLASS S:
Sold ........................ -- $ 38,409 -- $ 6,781 -- $ --
Issued as reinvestment of dividends -- 45,668 -- 1,585 -- --
Converted to Class B shares of Fund -- (1,322,036) -- (23,493) -- --
Redeemed .................... -- (359,380) -- (10,825) -- (1,317)
-------------- -------------- -------------
Net decrease -- $ (1,597,339) -- $ (25,952) -- $ (1,317)
============== ============== =============
CLASS I:
Sold ........................ $ 153,026,683 $ 23,668,029 $ 84,296,066 $ 41,671,290 -- --
Contribution in-kind (Note 10) -- 50,387,989 -- 18,189,328 -- --
Issued as reinvestment of dividends 5,043,047 2,301,452 4,377,204 2,625,806 -- $ 43
Redeemed .................... (6,603,795) (5,708,212) (1,192,890) (18,344,301) -- (1,130)
-------------- -------------- -------------- -------------- -------------
Net increase/(decrease) ..... $ 151,465,935 $ 70,649,258 $ 87,480,380 $ 44,142,123 -- $ (1,087)
============== ============== ============== ============== =============
</TABLE>
See Notes to Financial Statements.
15
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS -- CAPITAL STOCK ACTIVITY
WM GROUP OF FUNDS
<TABLE>
<CAPTION>
INCOME FUND HIGH YIELD FUND TAX-EXEMPT BOND FUND
------------------------------ ------------------------------ --------------------------
SIX MONTHS SIX MONTHS SIX MONTHS
ENDED ENDED ENDED
04/30/00 YEAR ENDED 04/30/00 YEAR ENDED 04/30/00 YEAR ENDED
(UNAUDITED) 10/31/99 (UNAUDITED) 10/31/99 (UNAUDITED) 10/31/99
-------------- -------------- -------------- -------------- ------------ -------------
<S> <C> <C> <C> <C> <C> <C>
SHARES
CLASS A:
Sold ........................ 522,902 3,367,655 374,064 2,642,096 525,656 1,371,226
Issued in exchange for Class A shares
of Griffin Bond Fund ...... -- 9,538,022 -- -- -- --
Issued in exchange for Class A shares
of Griffin Municipal Bond Fund -- -- -- -- -- 2,614,025
Issued as reinvestment of dividends 404,460 1,111,937 14,911 75,101 592,926 1,299,806
Redemption in-kind (Note 10) -- (5,482,915) -- (1,957,947) -- --
Redeemed .................... (3,757,942) (11,967,674) (171,724) (1,332,436) (5,174,709) (8,969,586)
-------------- -------------- -------------- -------------- ------------ -------------
Net increase/(decrease) ..... (2,830,580) (3,432,975) 217,251 (573,186) (4,056,127) (3,684,529)
============== ============== ============== ============== ============ =============
CLASS B:
Sold ........................ 650,885 2,164,259 882,081 2,173,216 433,477 1,619,222
Converted from Class S shares of Fund -- 143,700 -- 2,510 -- --
Issued in exchange for Class B shares
of Griffin Bond Fund ...... -- 6,187 -- -- -- --
Issued in exchange for Class B shares
of Griffin Municipal Bond Fund -- -- -- -- -- 70,300
Issued as reinvestment of dividends 93,540 170,868 58,236 59,109 57,806 93,785
Redeemed .................... (1,112,932) (1,370,789) (413,102) (183,937) (564,747) (539,376)
-------------- -------------- -------------- -------------- ------------ -------------
Net increase/(decrease) ..... (368,507) (1,114,225) 527,215 2,050,898 (73,464) 1,243,931
============== ============== ============== ============== ============ =============
CLASS S:
Sold ........................ -- 4,062 -- 729 -- --
Issued as reinvestment of dividends -- 4,872 -- 173 -- --
Converted to Class B shares of Fund -- (143,700) -- (2,510) -- --
Redeemed .................... -- (37,028) -- (1,096) -- (180)
-------------- -------------- -------------
Net decrease ................ -- (171,794) -- (2,704) -- (180)
============== ============== =============
CLASS I:
Sold ........................ 17,221,340 2,592,925 9,299,261 4,622,366 -- --
Contribution in-kind (Note 10) -- 5,482,915 -- 1,962,171 -- --
Issued as reinvestment of dividends 566,596 247,746 476,805 289,914 -- 5
Redeemed .................... (738,337) (632,129) (132,180) (2,007,198) -- (154)
-------------- -------------- -------------- -------------- -------------
Net increase/(decrease) ..... 17,049,599 7,691,457 9,643,886 4,867,253 -- (149)
============== ============== ============== ============== =============
</TABLE>
See Notes to Financial Statements.
16
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS -- CAPITAL STOCK ACTIVITY
WM GROUP OF FUNDS
<TABLE>
<CAPTION>
CALIFORNIA CALIFORNIA INSURED FLORIDA INSURED
MUNICIPAL FUND INTERMEDIATE MUNICIPAL FUND MUNICIPAL FUND
------------------------------ ------------------------------ ----------------------------
SIX MONTHS SIX MONTHS SIX MONTHS
ENDED ENDED ENDED
04/30/00 YEAR ENDED 04/30/00 YEAR ENDED 04/30/00 YEAR ENDED
(UNAUDITED) 10/31/99 (UNAUDITED) 10/31/99 (UNAUDITED) 10/31/99
-------------- -------------- -------------- -------------- ------------ -------------
<S> <C> <C> <C> <C> <C> <C>
AMOUNT
CLASS A:
Sold $ 7,878,487 $ 41,751,098 $ 2,450,178 $ 5,801,531 $ 286,828 $ 1,254,546
Issued in exchange for Class A shares
of Griffin California Tax-Free Fund -- 37,928,445 -- -- -- --
Issued as reinvestment of dividends 5,257,677 10,372,674 514,869 1,516,470 122,279 320,965
Redeemed (49,799,663) (66,556,958) (5,781,251) (11,187,986) (2,394,553) (4,161,036)
-------------- -------------- -------------- -------------- ------------ -------------
Net increase/(decrease) $ (36,663,499) $ 23,495,259 $ (2,816,204) $ ( 3,869,985) $ (1,985,446) $ (2,585,525)
============== ============== ============== ============== ============ =============
CLASS B:
Sold $ 21,457,911 $ 98,776,438 $ 4,235,262 $ 20,313,812 $ 455,548 $ 3,424,000
Issued in exchange for Class B shares
of Griffin California Tax-Free Fund -- 8,299,621 -- -- -- --
Issued as reinvestment of dividends 2,418,465 2,729,175 514,076 1,125,985 79,165 181,259
Redeemed (20,099,758) (15,021,843) (6,272,960) (7,814,544) (1,532,812) (1,689,238)
-------------- -------------- -------------- -------------- ------------ -------------
Net increase/(decrease) $ 3,776,618 $ 94,783,391 $ (1,523,622) $ 13,625,253 $ (998,099) $ 1,916,021
============== ============== ============== ============== ============ =============
CLASS S:
Sold -- $ -- -- $ -- -- $ --
Issued as reinvestment of dividends -- 193 -- 59 -- 24
Redeemed -- (6,259) -- (1,230) -- (519)
-------------- -------------- -------------
Net decrease -- $ (6,066) -- $ (1,171) -- $ (495)
============== ============== =============
CLASS I:
Sold -- $ -- -- $ -- -- $ --
Issued as reinvestment of dividends -- 38 -- 49 -- 40
Redeemed -- (1,177) -- (1,182) -- (1,170)
-------------- -------------- -------------
Net decrease -- $ (1,139) -- $ (1,133) -- $ (1,130)
============== ============== =============
SHARES
CLASS A:
Sold 753,411 3,895,529 238,563 541,797 29,981 121,863
Issued in exchange for Class A shares
of Griffin California Tax-Free Fund -- 3,337,347 -- -- -- --
Issued as reinvestment of dividends 505,634 926,781 50,048 141,850 12,848 31,470
Redeemed (4,793,636) (6,029,382) (563,287) (1,057,115) (251,513) (408,274)
-------------- -------------- -------------- -------------- ------------ -------------
Net increase/(decrease) (3,534,591) 2,130,275 (274,676) (373,468) (208,684) (254,941)
============== ============== ============== ============== ============ =============
CLASS B:
Sold 2,054,923 8,896,807 411,384 1,905,592 47,313 329,416
Issued in exchange for Class B shares
of Griffin California Tax-Free Fund -- 730,865 -- -- -- --
Issued as reinvestment of dividends 232,587 245,464 49,967 105,550 8,322 17,806
Redeemed (1,938,330) (1,376,764) (611,028) (740,773) (160,343) (166,430)
-------------- -------------- -------------- -------------- ------------ -------------
Net increase/(decrease) 349,180 8,496,372 (149,677) 1,270,369 (104,708) 180,792
============== ============== ============== ============== ============ =============
CLASS S:
Sold -- -- -- -- -- --
Issued as reinvestment of dividends -- 16 -- 5 -- 3
Redeemed -- (646) -- (169) -- (173)
-------------- -------------- -------------
Net decrease -- (630) -- (164) -- (170)
============== ============== =============
CLASS I:
Sold -- -- -- -- -- --
Issued as reinvestment of dividends -- 3 -- 5 -- 4
Redeemed -- (110) -- (112) -- (120)
-------------- -------------- -------------
Net decrease -- (107) -- (107) -- (116)
============== ============== =============
</TABLE>
See Notes to Financial Statements.
17
<PAGE>
FINANCIAL HIGHLIGHTS
BOND & STOCK FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD.
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS LESS DISTRIBUTIONS
--------------------------------------- ------------------------------------------
NET REALIZED DISTRIBUTIONS
NET ASSET VALUE, AND UNREALIZED TOTAL FROM DIVIDENDS FROM FROM
BEGINNING OF NET INVESTMENT GAIN ON INVESTMENT NET INVESTMENT NET REALIZED TOTAL
PERIOD INCOME INVESTMENTS OPERATIONS INCOME CAPITAL GAINS DISTRIBUTIONS
---------------- -------------- -------------- ---------- -------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
CLASS A
04/30/00 (unaudited) $14.60 $ 0.25 $ 0.36 $ 0.61 $(0.24) $(0.44) $(0.68)
10/31/99 14.02 0.41 0.61 1.02 (0.40) (0.04) (0.44)
10/31/98 16.13 0.45++ 0.21## 0.66 (0.45) (2.32) (2.77)
10/31/97 14.71 0.50 2.37 2.87 (0.51) (0.94) (1.45)
10/31/96 13.48 0.52 1.53 2.05 (0.50) (0.32) (0.82)
10/31/95 11.53 0.50 2.02 2.52 (0.49) (0.08) (0.57)
CLASS B
04/30/00 (unaudited) 14.53 0.17 0.38 0.55 (0.18) (0.44) (0.62)
10/31/99 13.96 0.27 0.63 0.90 (0.29) (0.04) (0.33)
10/31/98 16.10 0.33++ 0.19## 0.52 (0.34) (2.32) (2.66)
10/31/97 14.69 0.39 2.36 2.75 (0.40) (0.94) (1.34)
10/31/96 13.47 0.41 1.53 1.94 (0.40) (0.32) (0.72)
10/31/95 11.51 0.39 2.03 2.42 (0.38) (0.08) (0.46)
==========================
<FN>
* Annualized.
+ Total return is not annualized for the periods less than one year and does
not reflect any applicable sales charges. The total returns would have been
lower if fees had not been reduced by credits allowed by the custodian.
++ Per share numbers have been calculated using the average shares method.
## The amount shown may not accord with the change in aggregate gains and
losses of portfolio securities due to the timing of sales and redemptions of
Fund shares.
(a) Ratio of operating expenses to average net assets includes expenses paid
indirectly beginning in fiscal year 1995.
</FN>
See Notes to Financial Statements.
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
-----------------------------------------------------------------------
NET ASSETS, RATIO OF OPERATING RATIO OF NET
NET ASSET VALUE, END OF PERIOD EXPENSES TO INVESTMENT INCOME TO PORTFOLIO
END OF PERIOD TOTAL RETURN+ (IN 000'S) AVERAGE NET ASSETS(A) AVERAGE NET ASSETS TURNOVER RATE
---------------- ------------- ------------- ---------------------- ------------------- -------------
CLASS A
<S> <C> <C> <C> <C> <C> <C>
04/30/00 (unaudited) $14.53 4.26% $204,493 1.06%* 3.36%* 23%
10/31/99 14.60 7.36% 241,746 1.05% 2.61% 45%
10/31/98 14.02 4.03% 298,651 0.97% 3.09% 80%
10/31/97 16.13 20.81% 307,018 0.99% 3.31% 54%
10/31/96 14.71 15.66% 255,414 0.98% 3.68% 46%
10/31/95 13.48 22.55% 208,592 1.02% 3.98% 32%
CLASS B
04/30/00 (unaudited) 14.46 3.84% 57,182 1.86%* 2.56%* 23%
10/31/99 14.53 6.46% 75,485 1.84% 1.82% 45%
10/31/98 13.96 3.12% 74,542 1.76% 2.30% 80%
10/31/97 16.10 19.86% 46,556 1.79% 2.48% 54%
10/31/96 14.69 14.73% 22,243 1.86% 2.80% 46%
10/31/95 13.47 21.60% 7,372 1.84% 3.10% 32%
</TABLE>
18 & 19
<PAGE>
FINANCIAL HIGHLIGHTS
GROWTH & INCOME FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD.
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS LESS DISTRIBUTIONS
---------------------------------------- ---------------------------------------------
NET REALIZED DISTRIBUTIONS
NET ASSET VALUE, AND UNREALIZED TOTAL FROM DIVIDENDS FROM FROM
BEGINNING OF NET INVESTMENT GAIN/(LOSS) ON INVESTMENT NET INVESTMENT NET REALIZED TOTAL
PERIOD INCOME/(LOSS) INVESTMENTS OPERATIONS INCOME CAPITAL GAINS DISTRIBUTIONS
---------------- -------------- -------------- ---------- -------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
CLASS A04/30/00 (unaudited) $24.61 $ 0.02 $ 2.17 $ 2.19 $(0.02) $(0.83) $(0.85)
10/31/99 19.99 0.09++ 4.62 4.71 (0.09) (0.00)# (0.09)
10/31/98 21.01 0.11++ 1.43 1.54 (0.09) (2.47) (2.56)
10/31/97 17.26 0.12 4.98 5.10 (0.14) (1.21) (1.35)
10/31/96 14.65 0.20 3.16 3.36 (0.21) (0.54) (0.75)
10/31/95 12.71 0.22 2.31 2.53 (0.19) (0.40) (0.59)
CLASS B
04/30/00 (unaudited) 24.24 (0.09) 2.13 2.04 -- (0.83) (0.83)
10/31/99 19.77 (0.09)++ 4.56 4.47 -- -- --
10/31/98 20.85 (0.07)++ 1.46 1.39 (0.00)# (2.47) (2.47)
10/31/97 17.17 (0.02) 4.93 4.91 (0.02) (1.21) (1.23)
10/31/96 14.59 0.06 3.14 3.20 (0.08) (0.54) (0.62)
10/31/95 12.68 0.11 2.31 2.42 (0.11) (0.40) (0.51)
CLASS I
04/30/00 (unaudited) 24.65 0.05 2.18 2.23 (0.05) (0.83) (0.88)
10/31/99 20.03 0.16++ 4.61 4.77 (0.15) (0.00)# (0.15)
10/31/98(a) 21.42 0.11++ (1.43)## (1.32) (0.07) -- (0.07)
==========================
<FN>
* Annualized.
+ Total return is not annualized for the periods less than one year and does
not reflect any applicable sales charges. The total returns would have been
lower if fees had not been waived by the investment advisor and/or
distributor or if fees had not been reduced by credits allowed by the
custodian.
++ Per share numbers have been calculated using the average shares method.
# Amount represents less than $0.01 per share.
## The amount shown may not accord with the change in aggregate gains and
losses of portfolio securities due to the timing of sales and redemptions of
Fund shares.
(a) On March 23, 1998 the Fund commenced selling Class I shares.
(b) Ratio of operating expenses to average net assets includes expenses paid
indirectly beginning in fiscal year 1995.
</FN>
See Notes to Financial Statements.
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
--------------------------------------------------------------
NET ASSETS, RATIO OF RATIO OF NET INVESTMENT
NET ASSET VALUE, END OF PERIOD OPERATING EXPENSES INCOME/(LOSS) TO
END OF PERIOD TOTAL RETURN+ (IN 000'S) TO AVERAGE NET ASSETS(B) AVERAGE NET ASSETS
---------------- ------------- ------------- ------------------------ -----------------------
<S> <C> <C> <C> <C> <C>
CLASS A
04/30/00 (unaudited) $25.95 9.06% $675,223 0.94%* 0.15%*
10/31/99 24.61 23.57% 705,835 1.00% 0.37%
10/31/98 19.99 7.38% 502,115 0.94% 0.52%
10/31/97 21.01 31.24% 299,928 1.05% 0.66%
10/31/96 17.26 23.61% 178,331 1.03% 1.26%
10/31/95 14.65 20.87% 130,630 1.07% 1.62%
CLASS B
04/30/00 (unaudited) 25.45 8.58% 243,730 1.79%* (0.70)%*
10/31/99 24.24 22.61% 233,216 1.76% (0.39)%
10/31/98 19.77 6.60% 117,063 1.79% (0.33)%
10/31/97 20.85 30.20% 49,994 1.88% (0.19)%
10/31/96 17.17 22.55% 22,851 1.94% 0.34%
10/31/95 14.59 19.95% 8,871 1.91% 0.69%
CLASS I
04/30/00 (unaudited) 26.00 9.22% 619,619 0.61%* 0.48%*
10/31/99 24.65 23.87% 461,629 0.67% 0.70%
10/31/98(a) 20.03 (6.18)% 185,528 0.62%* 0.84%*
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
------------------------------------------------
RATIO OF OPERATING
EXPENSES TO AVERAGE
NET ASSETS WITHOUT FEE
WAIVERS AND/OR FEES
REDUCED BY CREDITS
PORTFOLIO ALLOWED BY THE
TURNOVER RATE CUSTODIAN
-------------- ----------------------
<S> <C> <C>
CLASS A
04/30/00 (unaudited) 19% 0.95%*
10/31/99 47% N/A
10/31/98 79% N/A
10/31/97 71% N/A
10/31/96 52% N/A
10/31/95 39% N/A
CLASS B
04/30/00 (unaudited) 19% 1.80%*
10/31/99 47% 1.84%
10/31/98 79% N/A
10/31/97 71% N/A
10/31/96 52% N/A
10/31/95 39% N/A
CLASS I
04/30/00 (unaudited) 19% 0.62%*
10/31/99 47% N/A
10/31/98(a) 79% N/A
=======================
</TABLE>
20 & 21
<PAGE>
FINANCIAL HIGHLIGHTS
GROWTH FUND OF THE NORTHWEST
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD.
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
-----------------------------------------------
NET REALIZED
NET ASSET VALUE, AND UNREALIZED TOTAL FROM
BEGINNING OF NET INVESTMENT GAIN/(LOSS) ON INVESTMENT NET
PERIOD INCOME/(LOSS) INVESTMENTS OPERATIONS
---------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
CLASS A
04/30/00(unaudited) $32.04 $0.01++ $8.21 $8.22
10/31/99 20.37 (0.05) 11.72 11.67
10/31/98 25.92 (0.02)++ (0.76) (0.78)
10/31/97 19.69 (0.02) 8.13 8.11
10/31/96 17.40 0.03 2.47 2.50
10/31/95 14.30 0.07 3.10 3.17
CLASS B
04/30/00(unaudited) 30.63 (0.13)++ 7.81 7.68
10/31/99 19.64 (0.25) 11.24 10.99
10/31/98 25.34 (0.20)++ (0.73) (0.93)
10/31/97 19.45 (0.08) 7.85 7.77
10/31/96 17.31 (0.08) 2.40 2.32
10/31/95 14.28 (0.05) 3.08 3.03
CLASS I
04/30/00(unaudited) 32.04 0.07++ 8.21 8.28
10/31/99(b) 29.72 0.01 2.31 2.32
====================
* Annualized.
+ Total return is not annualized for the periods less than one year and does
not reflect any applicable sales charges. The total returns would have been
lower if certain fees had not been waived by the investment advisor or if
fees had not been reduced by credits allowed by the custodian.
++ Per share numbers have been calculated using the average shares method.
(a) Ratio of operating expenses to average net assets includes expenses paid
indirectly beginning in fiscal year 1995. (b) On June 7, 1999 the Fund
commenced selling Class I shares.
See Notes to Financial Statements.
LESS DISTRIBUTIONS
--------------------------------------------------------------
DISTRIBUTIONS
DIVIDENDS FROM FROM DISTRIBUTIONS
INVESTMENT NET REALIZED FROM TOTAL NET ASSET VALUE,
INCOME CAPITAL GAINS CAPITAL DISTRIBUTIONS END OF PERIOD TOTAL RETURN+
-------------- ------------- ------------- ------------- ---------------- -------------
<S> <C> <C> <C> <C> <C> <C>
CLASS A
04/30/00(unaudited) $-- $(4.13) $ -- $(4.13) $36.13 28.37%
10/31/99 -- -- -- -- 32.04 57.29%
10/31/98 -- (4.74) (0.03) (4.77) 20.37 (4.81)%
10/31/97 -- (1.88) -- (1.88) 25.92 44.47%
10/31/96 (0.03) (0.18) -- (0.21) 19.69 14.54%
10/31/95 (0.07) -- -- (0.07) 17.40 22.24%
CLASS B
04/30/00(unaudited) -- (4.13) -- (4.13) 34.18 27.86%
10/31/99 -- -- -- -- 30.63 55.96%
10/31/98 -- (4.74) (0.03) (4.77) 19.64 (5.63)%
10/31/97 -- (1.88) -- (1.88) 25.34 43.17%
10/31/96 -- (0.18) -- (0.18) 19.45 13.54%
10/31/95 -- -- -- -- 17.31 21.25%
CLASS I
04/30/00(unaudited) -- (4.13) -- (4.13) 36.19 28.58%
10/31/99(b) -- -- -- -- 32.04 7.81%
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
------------------------------------------------------------------------------------------------------------
RATIO OF OPERATING
EXPENSES TO AVERAGE
NET ASSETS WITHOUT FEE
WAIVERS AND/OR FEES
NET ASSETS, RATIO OF RATIO OF NET INVESTMENT REDUCED BY CREDITS
END OF PERIOD OPERATING EXPENSES INCOME/(LOSS) TO PORTFOLIO ALLOWED BY THE
(IN 000'S) TO AVERAGE NET ASSETS(A) AVERAGE NET ASSETS TURNOVER RATE CUSTODIAN
------------- ------------------------ ----------------------- ------------- ----------------------
<S> <C> <C> <C> <C> <C>
CLASS A
04/30/00(unaudited) $437,526 1.04%* 0.07%* 25% 1.05%*
10/31/99 338,980 1.15% (0.21)% 41% 1.15%
10/31/98 243,126 1.10% (0.09)% 39% 1.10%
10/31/97 256,908 1.05% (0.08)% 37% 1.11%
10/31/96 176,706 1.08% 0.16% 42% 1.08%
10/31/95 157,953 1.10% 0.44% 9% 1.10%
CLASS B
04/30/00(unaudited) 110,261 1.87%* (0.76)%* 25% 1.88%*
10/31/99 77,658 1.99% (1.05)% 41% 1.99%
10/31/98 47,106 1.95% (0.94)% 39% 1.95%
10/31/97 39,627 1.91% (0.96)% 37% 1.97%
10/31/96 14,653 1.98% (0.76)% 42% 1.98%
10/31/95 7,083 1.95% (0.45)% 9% 1.95%
CLASS I
04/30/00(unaudited) 95,532 0.72%* 0.39%* 25% 0.73%*
10/31/99(b) 6,102 0.81%* 0.13%* 41% 0.81%*
</TABLE>
22 & 23
<PAGE>
FINANCIAL HIGHLIGHTS
GROWTH FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD.
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS LESS DISTRIBUTIONS
---------------------------------------- -------------------------------------------
NET REALIZED DISTRIBUTIONS
NET ASSET VALUE, AND UNREALIZED TOTAL FROM DIVIDENDS FROM FROM
BEGINNING OF NET INVESTMENT GAIN/(LOSS) ON INVESTMENT NET INVESTMENT NET REALIZED TOTAL
PERIOD INCOME/(LOSS) INVESTMENTS OPERATIONS INCOME CAPITAL GAINS DISTRIBUTIONS
--------------- -------------- -------------- ---------- -------------- ------------ -------------
<S> <C> <C> <C> <C> <C> <C> <C>
CLASS A
04/30/00 (unaudited) $29.71 $(0.12)++ $ 10.72 $ 10.60 $ -- $(3.83) $ (3.83)
10/31/99 17.64 (0.21)++ 14.11 13.90 -- (1.83) (1.83)
10/31/98(a) 18.46 (0.07)++ (0.75) (0.82) -- -- --
06/30/98 14.90 (0.15)++ 4.99 4.84 -- (1.28) (1.28)
06/30/97 15.69 (0.03)++ 1.58 1.55 -- (2.34) (2.34)
06/30/96 14.18 (0.07)++ 3.47 3.40 -- (1.89) (1.89)
06/30/95 10.73 0.05++ 3.42 3.47 (0.02) (0.00)# (0.02)
CLASS B
04/30/00 (unaudited) 28.29 (0.24)++ 10.16 9.92 -- (3.83) (3.83)
10/31/99 16.99 (0.38)++ 13.51 13.13 -- (1.83) (1.83)
10/31/98(a) 17.82 (0.12)++ (0.71) (0.83) -- -- --
06/30/98 14.53 (0.25)++ 4.82 4.57 -- (1.28) (1.28)
06/30/97 15.47 (0.14)++ 1.54 1.40 -- (2.34) (2.34)
06/30/96 14.10 (0.19)++ 3.45 3.26 -- (1.89) (1.89)
06/30/95(C) 10.73 (0.04)++ 3.42 3.38 (0.01) (0.00)# (0.01)
CLASS I
04/30/00 (unaudited) 29.96 (0.04)++ 10.82 10.78 -- (3.83) (3.83)
10/31/99 17.76 (0.11)++ 14.14 14.03 -- (1.83) (1.83)
10/31/98(a) 18.56 (0.05)++ (0.75) (0.80) -- -- --
06/30/98 14.94 (0.10)++ 5.00 4.90 -- (1.28) (1.28)
06/30/97(c) 14.21 0.00++# 3.07 3.07 -- (2.34) (2.34)
========================
<FN>
* Annualized.
+ Total return is not annualized for the periods less than one year and does
not reflect any applicable sales charges. The total returns would have been
lower in certain fees had not been waived by the investment advisor and/or
distributor or if fees had not been reduced by credits allowed by the
custodian.
++ Per share numbers have been calculated using the average shares method.
# Amount represents less than $0.01 per share.
(a) Fiscal year end changed to October 31 from June 30.
(b) Ratio of operating expenses to average net assets includes expenses paid
indirectly beginning in fiscal year 1995.
(c) On July 1, 1994 and July 25, 1996 the Fund commenced selling Class B and Class I shares, respectively.
</FN>
See Notes to Financial Statements.
NET ASSET VALUE,
END OF PERIOD TOTAL RETURN+
---------------- -------------
<S> <C> <C>
CLASS A
04/30/00 (unaudited) $36.48 38.22%
10/31/99 29.71 84.96%
10/31/98(a) 17.64 (4.44)%
06/30/98 18.46 35.43%
06/30/97 14.90 10.88%
06/30/96 15.69 25.44%
06/30/95 14.18 32.33%
CLASS B
04/30/00 (unaudited) 34.38 37.69%
10/31/99 28.29 83.57%
10/31/98(a) 16.99 (4.66)%
06/30/98 17.82 34.43%
06/30/97 14.53 9.99%
06/30/96 15.47 24.54%
06/30/95(c) 14.10 31.46%
CLASS I
04/30/00 (unaudited) 36.91 38.54%
10/31/99 29.96 85.13%
10/31/98(a) 17.76 (4.31)%
06/30/98 18.56 35.75%
06/30/97(c) 14.94 22.73%
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
--------------------------------------------------------------------------------------------------------
RATIO OF OPERATING
EXPENSES TO AVERAGE
NET ASSETS WITHOUT FEE
WAIVERS AND/OR FEES
NET ASSETS, RATIO OF RATIO OF NET INVESTMENT REDUCED BY CREDITS
END OF PERIOD OPERATING EXPENSES INCOME/(LOSS) TO PORTFOLIO ALLOWED BY THE
(IN 000'S) TO AVERAGE NET ASSETS(B) AVERAGE NET ASSETS TURNOVER RATE CUSTODIAN
------------- ------------------------ ----------------------- ------------- ----------------------
<S> <C> <C> <C> <C> <C>
CLASS A
04/30/00 (unaudited) $385,270 1.30%* (0.64)%* 58% 1.36%*
10/31/99 240,363 1.27% (0.84)% 119% 1.46%
10/31/98(a) 104,775 1.69%* (1.21)%* 24% N/A
06/30/98 112,153 1.66% (0.91)% 153% N/A
06/30/97 111,187 1.70% (0.22)% 156% N/A
06/30/96 179,720 1.70% (0.49)% 205% N/A
06/30/95 154,763 1.76% 0.28% 233% N/A
CLASS B
04/30/00 (unaudited) 498,344 2.04%* (1.38)%* 58% 2.10%*
10/31/99 226,507 2.03% (1.60)% 119% 2.25%
10/31/98(a) 39,379 2.54%* (2.06)%* 24% N/A
06/30/98 38,390 2.46% (1.70)% 153% N/A
06/30/97 30,397 2.45% (0.97)% 156% N/A
06/30/96 25,067 2.45% (1.24)% 205% N/A
06/30/95(c) 6,928 2.51% (0.47)% 233% N/A
CLASS I
04/30/00 (unaudited) 435,114 0.90%* (0.24)%* 58% 0.96%*
10/31/99 386,367 0.87% (0.44)% 119% 1.06%
10/31/98(a) 119,351 1.26%* (0.78)%* 24% N/A
06/30/98 115,729 1.36% (0.61)% 153% N/A
06/30/97(c) 126,986 1.45%* 0.03%* 156% N/A
</TABLE>
24 & 25
<PAGE>
FINANCIAL HIGHLIGHTS
MID CAP STOCK FUND(A)
FOR A FUND SHARE OUTSTANDING THROUGHOUT THE PERIOD.
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
---------------------------------------------
NET REALIZED
NET ASSET VALUE, AND UNREALIZED TOTAL FROM
BEGINNING OF NET INVESTMENT GAIN ON INVESTMENT NET ASSET VALUE,
PERIOD INCOME/(LOSS) INVESTMENTS OPERATIONS END OF PERIOD TOTAL RETURN+
---------------- -------------- -------------- ---------- ---------------- -------------
<S> <C> <C> <C> <C> <C> <C>
CLASS A
04/30/00 (unaudited) $10.00 $(0.00)# $ 1.27 $ 1.27 $11.27 12.70%
CLASS B
04/30/00 (unaudited) 10.00 (0.01) 1.25 1.24 11.24 12.40%
CLASS I
04/30/00 (unaudited) 10.00 0.00# 1.27 1.27 11.27 12.70%
=====================
* Annualized.
+ Total return is not annualized for the periods less than one year and does
not reflect any applicable sales charges.
# Amount represents less than $0.01 per share.
(a) The Fund commenced operations on March 1, 2000.
See Notes to Financial Statements.
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
-------------------------------------------------------------------------------
NET ASSETS, RATIO OF RATIO OF NET INVESTMENT
END OF PERIOD OPERATING EXPENSES INCOME/(LOSS) TO PORTFOLIO
(IN 000'S) TO AVERAGE NET ASSETS AVERAGE NET ASSETS TURNOVER RATE
------------- --------------------- ------------------------ -------------
<S> <C> <C> <C> <C>
CLASS A
04/30/00 (unaudited) $ 878 1.53%* (0.36)%* 0%
CLASS B
04/30/00 (unaudited) 731 2.27%* (1.10)%* 0%
CLASS I
04/30/00 (unaudited) 127,467 0.89%* 0.28%* 0%
</TABLE>
26 & 27
<PAGE>
FINANCIAL HIGHLIGHTS
SMALL CAP STOCK FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD.
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS LESS DISTRIBUTIONS
-------------------------------------------- --------------------------
NET REALIZED DISTRIBUTIONS
NET ASSET VALUE, AND UNREALIZED TOTAL FROM FROM
BEGINNING OF NET INVESTMENT GAIN/(LOSS) ON INVESTMENT NET REALIZED TOTAL
PERIOD LOSS INVESTMENTS OPERATIONS CAPITAL GAINS DISTRIBUTIONS
---------------- -------------- -------------- ---------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
CLASS A
04/30/00 (unaudited) $19.61 $(0.14)++ $ 8.82 $ 8.68 $(2.68) $(2.68)
10/31/99 16.25 (0.20)++ 6.36 6.16 (2.80) (2.80)
10/31/98(a) 19.49 (0.08)++ (3.16) (3.24) -- --
06/30/98 18.28 (0.22)++ 2.50 2.28 (1.07) (1.07)
06/30/97 20.17 (0.21)++ (0.18) (0.39) (1.50) (1.50)
06/30/96 15.47 (0.19)++ 5.65 5.46 (0.76) (0.76)
06/30/95 13.02 (0.00)++# 2.77 2.77 (0.32) (0.32)
CLASS B
04/30/00 (unaudited) 18.61 (0.24)++ 8.35 8.11 (2.68) (2.68)
10/31/99 15.67 (0.34)++ 6.08 5.74 (2.80) (2.80)
10/31/98(a) 18.86 (0.13)++ (3.06) (3.19) -- --
06/30/98 17.85 (0.36)++ 2.44 2.08 (1.07) (1.07)
06/30/97 19.88 (0.34)++ (0.19) (0.53) (1.50) (1.50)
06/30/96 15.37 (0.32)++ 5.59 5.27 (0.76) (0.76)
06/30/95(c) 13.02 (0.10)++ 2.77 2.67 (0.32) (0.32)
CLASS I
04/30/00 (unaudited) (c) 24.98 (0.08)++ 0.76 0.68 -- --
=======================
<FN>
* Annualized.
+ Total return is not annualized for the periods less than one year and does
not reflect any applicable sales charges. The total returns would have been
lower if certain fees had not been waived by the investment advisor or if
fees had not been reduced by credits allowed by the custodian.
++ Per share numbers have been calculated using the average shares method.
# Amount represents less than $0.01 per share.
(a) Fiscal year end changed to October 31 from June 30.
(b) Ratio of operating expenses to average net assets includes expenses paid
indirectly beginning in fiscal year 1995.
(c) On July 1, 1994 and January 5, 2000 the Fund commenced selling Class B and
Class I shares, respectively.
</FN>
See Notes to Financial Statements.
NET ASSET VALUE,
END OF PERIOD TOTAL RETURN+
---------------- -------------
<S> <C> <C>
CLASS A
04/30/00 (unaudited) $25.61 47.47%
10/31/99 19.61 42.60%
10/31/98(a) 16.25 (16.62)%
06/30/98 19.49 12.95%
06/30/97 18.28 (1.50)%
06/30/96 20.17 35.93%
06/30/95 15.47 21.54%
CLASS B
04/30/00 (unaudited) 24.04 46.90%
10/31/99 18.61 41.32%
10/31/98(a) 15.67 (16.87)%
06/30/98 18.86 12.05%
06/30/97 17.85 (2.26)%
06/30/96 19.88 34.93%
06/30/95(c) 15.37 20.69%
CLASS I
04/30/00 (unaudited) (c) 25.66 2.72%
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
----------------------------------------------------------------------------------------------------
RATIO OF OPERATING
EXPENSES TO AVERAGE
NET ASSETS WITHOUT FEE
WAIVERS AND/OR FEES
NET ASSETS, RATIO OF RATIO OF NET REDUCED BY CREDITS
END OF PERIOD OPERATING EXPENSES INVESTMENT LOSS TO PORTFOLIO ALLOWED BY THE
(IN 000'S) TO AVERAGE NET ASSETS(B) AVERAGE NET ASSETS TURNOVER RATE CUSTODIAN
------------ ------------------------ ------------------ ------------- ----------------------
<S> <C> <C> <C> <C> <C>
CLASS A
04/30/00 (unaudited) $ 132,839 1.45%* (1.03)%* 27% N/A
10/31/99 92,130 1.78% (1.16)% 45% 1.94%
10/31/98(a) 88,502 1.88%* (1.43)%* 20% 1.89%*
06/30/98 118,473 1.66% (1.10)% 112% 1.66%
06/30/97 165,719 1.64% (1.17)% 81% 1.64%
06/30/96 283,747 1.64% (1.02)% 131% 1.65%
06/30/95 185,722 1.68% (0.31)% 181% N/A
CLASS B
04/30/00 (unaudited) 52,235 2.27%* (1.85)%* 27% N/A
10/31/99 28,969 2.70% (2.08)% 45% 2.86%
10/31/98(a) 22,172 2.84%* (2.39)%* 20% 2.85%*
06/30/98 28,540 2.47% (1.92)% 112% 2.47%
06/30/97 29,123 2.39% (1.92)% 81% 2.39%
06/30/96 28,920 2.39% (1.77)% 131% 2.40%
06/30/95(c) 10,208 2.43% (1.06)% 181% N/A
CLASS I
04/30/00 (unaudited) (c) 76,584 1.00%* (0.58)%* 27% N/A
</TABLE>
28 & 29
<PAGE>
FINANCIAL HIGHLIGHTS
INTERNATIONAL GROWTH FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD.
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS
----------------------------------------
NET ASSET NET REALIZED
VALUE, NET AND UNREALIZED TOTAL FROM
BEGINNING INVESTMENT GAIN/(LOSS)ON INVESTMENT
OF PERIOD INCOME/(LOSS) INVESTMENTS OPERATIONS
--------- ------------ -------------- ----------
<S> <C> <C> <C> <C>
CLASS A
04/30/00 (unaudited) $ 11.14 $(0.01)++ $ 1.99 $ 1.98
10/31/99 8.86 0.01++ 2.65 2.66
10/31/98(a) 10.20 (0.02)++ (1.32) (1.34)
06/30/98 11.85 0.05++ (0.67) (0.62)
06/30/97 10.49 0.04++ 1.55 1.59
06/30/96 9.78 0.05++ 1.21 1.26
06/30/95 10.74 (0.11)++ (0.31) (0.42)
CLASS B
04/30/00 (unaudited) 10.87 (0.05)++ 1.95 1.90
10/31/99 8.72 (0.08)++ 2.60 2.52
10/31/98(a) 10.07 (0.05)++ (1.30) (1.35)
06/30/98 11.70 (0.04)++ (0.64) (0.68)
06/30/97 10.39 (0.04)++ 1.53 1.49
06/30/96 9.73 (0.03)++ 1.21 1.18
06/30/95(c) 10.74 (0.17)++ (0.31) (0.48)
CLASS I
04/30/00 (unaudited) 11.16 0.03++ 1.98 2.01
10/31/99 8.83 0.07++ 2.65 2.72
10/31/98(a) 10.16 0.00++# (1.33) (1.33)
06/30/98 11.82 0.09++ (0.69) (0.60)
06/30/97(c) 9.88 0.06++ 2.15 2.21
==================
<FN>
* Annualized.
+ Total return is not annualized for the periods less than one year and does
not reflect any applicable sales charges. The total returns would have been
lower if certain fees had not been waived by the investment advisor or if
fees had not been reduced by credits allowed by the custodian.
++ Per share numbers have been calculated using the average shares method.
# Amount represents less than $0.01 per share.
(a) Fiscal year end changed to October 31 from June 30.
(b) Ratio of operating expenses to average net assets includes expenses paid
indirectly beginning in fiscal year 1995.
(c) On July 1, 1994 and July 25, 1996 the Fund commenced selling Class B and
Class I shares, respectively.
</FN>
See Notes to Financial Statements.
LESS DISTRIBUTIONS
-------------------------------------------------------------------------
DISTRIBUTIONS
DIVIDENDS IN EXCESS DISTRIBUTIONS DISTRIBUTIONS
FROM NET OF NET FROM IN EXCESS OF
INVESTMENT INVESTMENT NET REALIZED NET REALIZED TOTAL NET ASSET VALUE,
INCOME INCOME CAPITAL GAINS GAINS DISTRIBUTIONS END OF PERIOD TOTAL RETURN+
---------- ------------- ------------- ------------- ------------- ---------------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
CLASS A
04/30/00 (unaudited) $(0.14) $ -- $ -- $ -- $(0.14) $12.98 17.82%
10/31/99 (0.27) -- (0.11) -- (0.38) 11.14 31.15%
10/31/98(a) -- -- -- -- -- 8.86 (13.14)%
06/30/98 (0.50) (0.03) (0.50) -- (1.03) 10.20 (4.19)%
06/30/97 (0.13) -- (0.10) -- (0.23) 11.85 15.50%
06/30/96 (0.05) (0.04) (0.46) -- (0.55) 10.49 13.16%
06/30/95 (0.04) -- (0.44) (0.06) (0.54) 9.78 (4.01)%
CLASS B
04/30/00 (unaudited) (0.07) -- -- -- (0.07) 12.70 17.47%
10/31/99 (0.26) -- (0.11) -- (0.37) 10.87 29.87%
10/31/98(a) -- -- -- -- -- 8.72 (13.41)%
06/30/98 (0.42) (0.03) (0.50) -- (0.95) 10.07 (4.95)%
06/30/97 (0.08) -- (0.10) -- (0.18) 11.70 14.66%
06/30/96 (0.02) (0.04) (0.46) -- (0.52) 10.39 12.34%
06/30/95(c) (0.03) -- (0.44) (0.06) (0.53) 9.73 (4.61)%
CLASS I
04/30/00 (unaudited) (0.21) -- -- -- (0.21) 12.96 18.12%
10/31/99 (0.28) -- (0.11) -- (0.39) 11.16 31.98%
10/31/98(a) -- -- -- -- -- 8.83 (13.09)%
06/30/98 (0.53) (0.03) (0.50) -- (1.06) 10.16 (3.98)%
06/30/97(c) (0.17) -- (0.10) -- (0.27) 11.82 22.76%
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
--------------------------------------------------------------------------------------------------------------
RATIO OF OPERATING
EXPENSES TO AVERAGE
NET ASSETS WITHOUT FEE
WAIVERS AND/OR FEES
NET ASSETS, RATIO OF RATIO OF NET REDUCED BY CREDITS
END OF PERIOD OPERATING EXPENSES INVESTMENT INCOME/(LOSS) PORTFOLIO ALLOWED BY THE
(IN 000'S) TO AVERAGE NET ASSETS(B) TO AVERAGE NET ASSETS TURNOVER RATE CUSTODIAN
------------- ------------------------ ------------------------ ------------- ----------------------
<S> <C> <C> <C> <C> <C>
CLASS A
04/30/00 (unaudited) $ 32,676 1.76%* (0.15)%* 19% 1.76%*
10/31/99 28,618 1.88% 0.13% 164% 1.89%
10/31/98(a) 30,117 1.86%* (0.50)%* 41% 1.86%*
06/30/98 38,281 1.67% 0.50% 118% 1.67%
06/30/97 57,776 1.65% 0.35% 67% 1.65%
06/30/96 116,254 1.77% 0.46% 125% 1.77%
06/30/95 91,763 1.69% 0.62% 81% N/A
CLASS B
04/30/00 (unaudited) 14,645 2.47%* (0.86)%* 19% 2.47%*
10/31/99 11,101 2.80% (0.79)% 164% 2.81%
10/31/98(a) 3,552 2.97%* (1.61)%* 41% 2.97%*
06/30/98 4,294 2.94% (0.35)% 118% 2.94%
06/30/97 4,876 2.40% (0.40)% 67% 2.40%
06/30/96 4,447 2.52% (0.29)% 125% 2.52%
06/30/95(c) 2,268 2.44% (0.13)% 81% N/A
CLASS I
04/30/00 (unaudited) 157,087 1.13%* 0.48%* 19% 1.13%*
10/31/99 163,610 1.28% 0.73% 164% 1.29%
10/31/98(a) 98,554 1.32%* 0.04%* 41% 1.32%*
06/30/98 108,521 1.36% 0.81% 118% 1.36%
06/30/97(c) 95,512 1.40%* 0.60%* 67% 1.40%*
</TABLE>
30 & 31
<PAGE>
FINANCIAL HIGHLIGHTS
SHORT TERM INCOME FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD.
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS LESS DISTRIBUTIONS
------------------------------------------ -------------------------------------------------
NET REALIZED DISTRIBUTIONS IN
NET ASSET VALUE, AND UNREALIZED TOTAL FROM DIVIDENDS FROM EXCESS OF NET DISTRIBUTIONS
BEGINNING OF NET INVESTMENT GAIN/(LOSS) ON INVESTMENT NET INVESTMENT INVESTMENT FROM
PERIOD INCOME INVESTMENTS OPERATIONS INCOME INCOME CAPITAL
---------------- -------------- -------------- ---------- -------------- ---------------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
CLASS A
04/30/00 (unaudited) $ 2.29 $ 0.06 $(0.03) $ 0.03 $(0.06) $ -- $ --
10/31/99 2.35 0.13++ (0.06) 0.07 (0.13) -- --
10/31/98 (a) 2.32 0.04 0.03 0.07 (0.04) -- --
06/30/98 2.32 0.13 0.00# 0.13 (0.13) -- (0.00)#
06/30/97 2.32 0.14 0.00# 0.14 (0.14) -- --
06/30/96 2.35 0.15++ (0.03) 0.12 (0.15) -- (0.00)#
06/30/95 2.39 0.08 0.02 0.10 (0.08) (0.06) (0.00)#
CLASS B
04/30/00 (unaudited) 2.29 0.06 (0.03) 0.03 (0.06) -- --
10/31/99 2.35 0.10++ (0.06) 0.04 (0.10) -- --
10/31/98(a) 2.32 0.04 0.03 0.07 (0.04) -- --
06/30/98 2.32 0.12 0.00# 0.12 (0.12) -- (0.00)#
06/30/97 2.32 0.12 0.00# 0.12 (0.12) -- --
06/30/96 2.35 0.13++ (0.03) 0.10 (0.13) -- (0.00)#
06/30/95(c) 2.39 0.06 0.02 0.08 (0.06) (0.06) (0.00)#
CLASS I
04/30/00 (unaudited) 2.29 0.07 (0.03) 0.04 (0.07) -- --
10/31/99 2.35 0.13++ (0.06) 0.07 (0.13) -- --
10/31/98(a) 2.32 0.04 0.03 0.07 (0.04) -- --
06/30/98 2.32 0.14 0.00# 0.14 (0.14) -- (0.00)#
06/30/97(c) 2.32 0.14 0.00# 0.14 (0.14) -- --
===================
<FN>
* Annualized.
+ Total return is not annualized for periods less than one year and does not
reflect any applicable sales charges. The total returns would have been
lower if certain fees had not been waived and expensesreimbursed by the
investment advisor or if fees had not been reduced by credits allowed by the
custodian.
++ Per share numbers have been calculated using the average shares method.
# Amount represents less than $0.01 per share.
(a) Fiscal year end changed to October 31 from June 30.
(b) Ratio of operating expenses to average net assets includes expenses paid
indirectly beginning in fiscal year 1995.
(c) On July 1, 1994 and July 25, 1996 the Fund commenced selling Class B and
Class I shares, respectively.
</FN>
See Notes to Financial Statements.
LESS DISTRIBUTIONS RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
------------------ -------------------------------------------------------
NET ASSETS, RATIO OF
TOTAL NET ASSET VALUE, END OF PERIOD OPERATING EXPENSES
DISTRIBUTIONS END OF PERIOD TOTAL RETURN+ (IN 000'S) TO AVERAGE NET ASSETS(B)
------------- --------------- ------------- ------------- ------------------------
<S> <C> <C> <C> <C> <C>
CLASS A
04/30/00 (unaudited) $(0.06) $ 2.26 1.44% $22,760 0.99%*
10/31/99 (0.13) 2.29 2.84% 27,059 0.82%
10/31/98 (a) (0.04) 2.35 3.11% 32,748 0.82%*
06/30/98 (0.13) 2.32 5.91% 35,551 0.86%
06/30/97 (0.14) 2.32 6.15% 13,685 0.82%
06/30/96 (0.15) 2.32 5.05% 32,440 0.75%
06/30/95 (0.14) 2.35 4.42% 43,811 0.75%
CLASS B
04/30/00 (unaudited) (0.06) 2.26 1.16% 3,727 1.54%*
10/31/99 (0.10) 2.29 1.79% 4,597 1.60%
10/31/98(a) (0.04) 2.35 2.85% 3,747 1.57%*
06/30/98 (0.12) 2.32 5.13% 3,459 1.61%
06/30/97 (0.12) 2.32 5.37% 2,994 1.57%
06/30/96 (0.13) 2.32 4.27% 3,437 1.50%
06/30/95(c) (0.12) 2.35 3.64% 3,015 1.50%
CLASS I
04/30/00 (unaudited) (0.07) 2.26 1.79% 96,396 0.30%*
10/31/99 (0.13) 2.29 2.93% 138,955 0.37%
10/31/98(a) (0.04) 2.35 3.20% 1,631 0.57%*
06/30/98 (0.14) 2.32 6.17% 3,103 0.53%
06/30/97(c) (0.14) 2.32 5.94% 2,752 0.57%*
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
-----------------------------------------------------------
RATIO OF OPERATING
EXPENSES TO AVERAGE
NET ASSETS WITHOUT FEE
WAIVERS AND/OR FEES
RATIO OF NET REDUCED BY CREDITS
INVESTMENT INCOME TO PORTFOLIO ALLOWED BY THE
AVERAGE NET ASSETS TURNOVER RATE CUSTODIAN
-------------------- ------------- ---------------------
<S> <C> <C> <C>
CLASS A
04/30/00 (unaudited) 5.52%* 4% 1.29%*
10/31/99 5.22% 85% 1.16%
10/31/98 (a) 5.44%* 19% 1.40%*
06/30/98 5.71% 138% 1.32%
06/30/97 6.50% 51% 1.45%
06/30/96 6.22% 225% 1.42%
06/30/95 6.10% 137% 1.39%
CLASS B
04/30/00 (unaudited) 4.97%* 4% 1.84%*
10/31/99 4.44% 85% 1.94%
10/31/98(a) 4.69%* 19% 2.18%*
06/30/98 4.96% 138% 2.07%
06/30/97 5.75% 51% 2.20%
06/30/96 5.47% 225% 2.17%
06/30/95(c) 5.35% 137% 2.14%
CLASS I
04/30/00 (unaudited) 6.21%* 4% 0.60%*
10/31/99 5.67% 85% 0.71%
10/31/98(a) 5.69%* 19% 0.96%*
06/30/98 6.03% 138% 1.00%
06/30/97(c) 6.75%* 51% 1.20%*
</TABLE>
32 & 33
<PAGE>
FINANCIAL HIGHLIGHTS
U.S. GOVERNMENT SECURITIES FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD.
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS LESS DISTRIBUTIONS
----------------------------------------- -------------------------------------------------
NET REALIZED DISTRIBUTIONS
NET ASSET VALUE, AND UNREALIZED TOTAL FROM DIVIDENDS FROM IN EXCESS OF
BEGINNING OF NET INVESTMENT GAIN/(LOSS) ON INVESTMENT NET INVESTMENT NET INVESTMENT TOTAL
PERIOD INCOME INVESTMENTS OPERATIONS INCOME INCOME DISTRIBUTIONS
--------------- -------------- -------------- ---------- -------------- -------------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
CLASS A
04/30/00 (unaudited) $10.51 $ 0.31 $(0.20) $ 0.11 $(0.31) $ -- $(0.31)
10/31/99 10.98 0.62 (0.47) 0.15 (0.61) (0.01) (0.62)
10/31/98(a) 10.84 0.54 0.14 0.68 (0.54) -- (0.54)
12/31/97 10.46 0.62 0.38 1.00 (0.62) -- (0.62)
12/31/96 10.84 0.63 (0.38) 0.25 (0.63) -- (0.63)
12/31/95 9.64 0.63 1.20 1.83 (0.63) -- (0.63)
12/31/94 10.79 0.63 (1.15) (0.52) (0.63) -- (0.63)
CLASS B
04/30/00 (unaudited) 10.50 0.28 (0.20) 0.08 (0.28) -- (0.28)
10/31/99 10.97 0.54 (0.48) 0.06 (0.53) (0.00)# (0.53)
10/31/98(a) 10.84 0.47 0.12 0.59 (0.46) -- (0.46)
12/31/97 10.46 0.54 0.38 0.92 (0.54) -- (0.54)
12/31/96 10.84 0.54 (0.38) 0.16 (0.54) -- (0.54)
12/31/95 9.64 0.54 1.20 1.74 (0.54) -- (0.54)
12/31/94(c) 10.24 0.41 (0.60) (0.19) (0.41) -- (0.41)
CLASS I
04/30/00 (unaudited) 10.51 0.33 (0.20) 0.13 (0.33) -- (0.33)
10/31/99 10.99 0.66 (0.51) 0.15 (0.62) (0.01) (0.63)
10/31/98(c) 10.86 0.42 0.12 0.54 (0.41) -- (0.41)
=====================
<FN>
* Annualized.
+ Total return is not annualized for periods less than one year and does not
reflect any applicable sales charges. The total returns would have been
lower if certain fees had not been waived by the investment advisor or if
fees had not been reduced by credits allowed by the custodian.
# Amount represents less than $0.01 per share.
(a) Fiscal year end changed to October 31 from December 31.
(b) Ratio of operating expenses to average net assets includes expenses paid
indirectly beginning in fiscal year 1995.
(c) On March 30, 1994 and March 23, 1998 the Fund commenced selling Class B and
Class I shares, respectively.
</FN>
See Notes to Financial Statements.
NET ASSET VALUE,
END OF PERIOD TOTAL RETURN+
--------------- -------------
<S> <C> <C>
CLASS A
04/30/00 (unaudited) $10.31 1.09%
10/31/99 10.51 1.38%
10/31/98(a) 10.98 6.38%
12/31/97 10.84 9.92%
12/31/96 10.46 2.48%
12/31/95 10.84 19.45%
12/31/94 9.64 (4.91)%
CLASS B
04/30/00 (unaudited) 10.30 0.74%
10/31/99 10.50 0.53%
10/31/98(a) 10.97 5.54%
12/31/97 10.84 9.03%
12/31/96 10.46 1.58%
12/31/95 10.84 18.48%
12/31/94(c) 9.64 (1.86)%
CLASS I
04/30/00 (unaudited) 10.31 1.30%
10/31/99 10.51 1.43%
10/31/98(c) 10.99 5.00%
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
------------------------------------------------------------------------------------------------------------
RATIO OF OPERATING
EXPENSES TO AVERAGE
RATIO OF OPERATING NET ASSETS WITHOUT FEE
RATIO OF EXPENSES TO RATIO OF NET WAIVERS AND/OR FEES
NET ASSETS, OPERATING EXPENSES AVERAGE NET ASSETS INVESTMENT INCOME REDUCED BY CREDITS
END OF PERIOD TO AVERAGE INCLUDING INTEREST TO AVERAGE PORTFOLIO ALLOWED BY THE
(IN 000'S) NET ASSETS(B) EXPENSE NET ASSETS TURNOVER RATE CUSTODIAN
------------- ------------------ ------------------ ----------------- ------------- ----------------------
<S> <C> <C> <C> <C> <C> <C>
CLASS A
04/30/00 (unaudited) $184,887 0.96%* N/A 6.14%* 4% 1.00%*
10/31/99 221,592 0.96% N/A 5.76% 55% 1.04%
10/31/98(a) 266,334 0.92%* 1.36%* 5.99%* 12% 1.45%*
12/31/97 107,054 1.05% N/A 5.92% 6% 1.05%
12/31/96 138,159 0.97% N/A 6.01% 16% 0.97%
12/31/95 177,310 1.01% N/A 6.08% 8% 1.01%
12/31/94 188,068 0.97% N/A 6.19% 34% 0.97%
CLASS B
04/30/00 (unaudited) 56,972 1.65%* N/A 5.45%* 4% 1.69%*
10/31/99 72,751 1.70% N/A 5.02% 55% 1.78%
10/31/98(a) 28,747 1.67%* 2.12%* 5.24%* 12% 2.22%*
12/31/97 3,352 1.84% N/A 5.08% 6% 1.84%
12/31/96 2,963 1.85% N/A 5.14% 16% 1.85%
12/31/95 2,206 1.84% N/A 5.20% 8% 1.84%
12/31/94(c) 1,063 1.76%* N/A 5.43%* 34% 1.76%*
CLASS I
04/30/00 (unaudited) 210,714 0.55%* N/A 6.55%* 4% 0.59%*
10/31/99 184,708 0.60% N/A 6.12% 55% 0.68%
10/31/98(c) 39,939 0.66%* 1.10%* 6.25%* 12% 1.11%*
</TABLE>
34 & 35
<PAGE>
FINANCIAL HIGHLIGHTS
INCOME FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD.
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS LESS DISTRIBUTIONS
---------------------------------------- -----------------------------
NET REALIZED
NET ASSET VALUE, AND UNREALIZED TOTAL FROM DIVIDENDS FROM
BEGINNING OF NET INVESTMENT GAIN/(LOSS) ON INVESTMENT NET INVESTMENT TOTAL NET ASSET VALUE,
PERIOD INCOME INVESTMENTS OPERATIONS INCOME DISTRIBUTIONS END OF PERIOD TOTAL RETURN+
---------------- -------------- -------------- ---------- -------------- ------------- ---------------- -------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS A
04/30/00 (unaudited)$ 8.99 $ 0.31 $(0.15) $ 0.16 $(0.31) $(0.31) $ 8.84 1.79%
10/31/99 9.44 0.63 (0.45) 0.18 (0.63) (0.63) 8.99 1.98%
10/31/98(a) 9.48 0.53 (0.04)## 0.49 (0.53) (0.53) 9.44 5.21%
12/31/97 9.15 0.60 0.33 0.93 (0.60) (0.60) 9.48 10.51%
12/31/96 9.44 0.59 (0.29) 0.30 (0.59) (0.59) 9.15 3.46%
12/31/95 8.29 0.59 1.15 1.74 (0.59) (0.59) 9.44 21.58%
12/31/94 9.33 0.60 (1.04) (0.44) (0.60) (0.60) 8.29 (4.82)%
CLASS B
04/30/00 (unaudited) 9.00 0.28 (0.13) 0.15 (0.28) (0.28) 8.87 1.66%
10/31/99 9.45 0.56 (0.45) 0.11 (0.56) (0.56) 9.00 1.12%
10/31/98(a) 9.49 0.46 (0.04)## 0.42 (0.46) (0.46) 9.45 4.51%
12/31/97 9.17 0.53 0.32 0.85 (0.53) (0.53) 9.49 9.51%
12/31/96 9.46 0.52 (0.29) 0.23 (0.52) (0.52) 9.17 2.59%
12/31/95 8.30 0.51 1.16 1.67 (0.51) (0.51) 9.46 20.70%
12/31/94(c) 8.85 0.40 (0.55) (0.15) (0.40) (0.40) 8.30 (1.67)%
CLASS I
04/30/00 (unaudited) 8.99 0.33 (0.13) 0.20 (0.33) (0.33) 8.86 2.24%
10/31/99 9.44 0.65 (0.45) 0.20 (0.65) (0.65) 8.99 2.24%
10/31/98(c) 9.57 0.41 (0.13)## 0.28 (0.41) (0.41) 9.44 2.84%
===================
<FN>
* Annualized.
+ Total return is not annualized for periods less than one year and does not
reflect any applicable sales charges. The total returns would have been
lower if certain fees had not been waived by the investment advisor and/or
distributor or if fees had not been reduced by credits allowed by the
custodian.
## The amount shown may not accord with the change in aggregate gains and
losses of portfolio securities due to the timing of sales and redemptions of
Fund shares.
(a) Fiscal year end changed to October 31 from December 31.
(b) Ratio of operating expenses to average net assets includes expenses paid
indirectly beginning in fiscal year 1995.
(c) On March 30, 1994 and March 23, 1998 the Fund commenced selling Class B and
Class I shares, respectively.
</FN>
See Notes to Financial Statements.
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
---------------------------------------------------------------------------------------------------
RATIO OF OPERATING
EXPENSES TO AVERAGE
NET ASSETS WITHOUT FEE
WAIVERS AND/OR FEES
NET ASSETS, RATIO OF RATIO OF NET REDUCED BY CREDITS
END OF PERIOD OPERATING EXPENSES INVESTMENT INCOME TO PORTFOLIO ALLOWED BY THE
(IN 000'S) TO AVERAGE NET ASSETS(B) AVERAGE NET ASSETS TURNOVER RATE CUSTODIAN
------------- ------------------------ -------------------- ------------- ----------------------
<S> <C> <C> <C> <C> <C>
CLASS A
04/30/00 (unaudited) $144,365 1.04%* 6.92%* 13% 1.06%*
10/31/99 172,217 1.06% 6.84% 19% 1.10%
10/31/98(a) 213,397 1.07%* 6.66%* 37% N/A
12/31/97 77,864 1.08% 6.47% 27% N/A
12/31/96 86,657 1.03% 6.52% 42% N/A
12/31/95 97,534 1.08% 6.59% 43% N/A
12/31/94 88,102 1.04% 6.83% 26% N/A
CLASS B
04/30/00 (unaudited) 38,806 1.75%* 6.21%* 13% 1.77%*
10/31/99 42,715 1.81% 6.09% 19% 1.85%
10/31/98(a) 34,321 1.84%* 5.89%* 37% N/A
12/31/97 9,691 1.86% 5.65% 27% N/A
12/31/96 7,122 1.89% 5.69% 42% N/A
12/31/95 4,452 1.91% 5.73% 43% N/A
12/31/94(c) 2,299 1.80%* 6.25%* 26% N/A
CLASS I
04/30/00 (unaudited) 226,039 0.61%* 7.35%* 13% 0.63%*
10/31/99 76,145 0.68% 7.22% 19% 0.72%
10/31/98(c) 7,342 0.71%* 7.02%* 37% N/A
</TABLE>
36 & 37
<PAGE>
FINANCIAL HIGHLIGHTS
HIGH YIELD FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD.
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS LESS DISTRIBUTIONS
---------------------------------------- -----------------------------------------------------------
NET REALIZED DISTRIBUTIONS IN DISTRIBUTIONS
NET ASSET VALUE, AND UNREALIZED TOTAL FROM DIVIDENDS FROM EXCESS OF NET FROM
BEGINNING OF NET INVESTMENT GAIN/(LOSS) ON INVESTMENT NET INVESTMENT INVESTMENT NET REALIZED TOTAL
PERIOD INCOME INVESTMENTS OPERATIONS INCOME INCOME CAPITAL GAINS DISTRIBUTIONS
---------------- -------------- -------------- ---------- -------------- ----------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
CLASS A
04/30/00 (unaudited)$ 8.92 $ 0.45 $ 0.13 $ 0.58 $(0.44) $-- $-- $(0.44)
10/31/99 8.86 0.91++ 0.14## 1.05 (0.94) -- (0.05) (0.99)
10/31/98(a) 10.00 0.47 (1.15) (0.68) (0.45) (0.01) -- (0.46)
CLASS B
04/30/00 (unaudited) 8.97 0.41 0.13 0.54 (0.41) -- -- (0.41)
10/31/99 8.90 0.86++ 0.15## 1.01 (0.89) -- (0.05) (0.94)
10/31/98(a) 10.00 0.42 (1.09) (0.67) (0.42) (0.01) -- (0.43)
CLASS I
04/30/00 (unaudited) 8.91 0.45 0.13 0.58 (0.45) -- -- (0.45)
10/31/99 8.85 0.98++ 0.11## 1.09 (0.98) -- (0.05) (1.03)
10/31/98(a) 10.00 0.22 (1.13) (0.91) (0.23) (0.01) -- (0.24)
---------------------------------------------------------------------------------------------------------------------------------
<FN>
* Annualized.
+ Total return is not annualized for the periods less than one year and does
not reflect any applicable sales charges. The total returns would have been
lower if certain fees had not been waived or if fees had not been reduced by
credits allowed by the custodian.
++ Per share numbers have been calculated using the average shares method.
## The amount shown may not accord with the change in aggregate gains and
losses of portfolio securities due to the timing of sales and redemptions of
Fund shares.
(a) On April 8, 1998, May 5, 1998 and July 27, 1998 the Fund commenced selling
Class A, Class B, and Class I shares, respectively.
(b) Ratio of operating expenses to average net assets includes expenses paid
indirectly.
</FN>
See Notes to Financial Statements.
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
----------------------------------------------------------------------------------------
RATIO OF OPERATING
EXPENSES TO AVERAGE
NET ASSETS
WITHOUT FEE
WAIVERS AND/OR
NET ASSETS, RATIO OF RATIO OF NET PORTFOLIO FEES REDUCED BY
NET ASSET VALUE, TOTAL END OF PERIOD OPERATING EXPENSES INVESTMENT INCOME TO TURNOVER CREDITS ALLOWED
END OF PERIOD RETURN+ (IN 000'S) TO AVERAGE NET ASSETS(B) AVERAGE NET ASSETS RATE BY THE CUSTODIAN
--------------- ------- ------------- ------------------------ -------------------- ---------- ----------------
<S> <C> <C> <C> <C> <C> <C> <C>
CLASS A
04/30/00 (unaudited)$ 9.06 6.62% $ 7,882 1.14%* 9.87%* 23% 1.14%*
10/31/99 8.92 12.26% 5,827 0.73% 10.17% 30% 1.37%
10/31/98(a) 8.86 (6.90)% 10,861 0.78%* 8.80%* 54% 1.22%*
CLASS B
04/30/00 (unaudited) 9.10 6.14% 26,341 1.82%* 9.19%* 23% 1.82%*
10/31/99 8.97 11.44% 21,259 1.29% 9.61% 30% 1.93%
10/31/98(a) 8.90 (6.33)% 2,830 1.57%* 8.01%* 54% 2.02%*
CLASS I
04/30/00 (unaudited) 9.04 6.71% 132,496 0.75%* 10.26%* 23% 0.75%*
10/31/99 8.91 12.75% 44,662 0.21% 10.69% 30% 0.85%
10/31/98(a) 8.85 (9.13)% 1,309 0.48%* 9.10%* 54% 0.97%*
</TABLE>
38 & 39
<PAGE>
FINANCIAL HIGHLIGHTS
TAX-EXEMPT BOND FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD.
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS LESS DISTRIBUTIONS
---------------------------------------- --------------------------------------------
NET REALIZED DISTRIBUTIONS
NET ASSET VALUE, AND UNREALIZED TOTAL FROM DIVIDENDS FROM FROM
BEGINNING OF NET INVESTMENT GAIN/(LOSS) ON INVESTMENT NET INVESTMENT NET REALIZED TOTAL
PERIOD INCOME INVESTMENTS OPERATIONS INCOME CAPITAL GAINS DISTRIBUTIONS
---------------- -------------- -------------- ---------- -------------- -------------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
CLASS A
04/30/00 (unaudited)$ 7.41 $ 0.20 $ (0.05) $ 0.15 $(0.20) $-- $ (0.20)
10/31/99 8.11 0.41 (0.70) (0.29) (0.41) -- (0.41)
10/31/98(a) 8.09 0.34 0.02 0.36 (0.34) -- (0.34)
12/31/97 7.83 0.38 0.27 0.65 (0.38) (0.01) (0.39)
12/31/96 8.02 0.38 (0.19) 0.19 (0.38) -- (0.38)
12/31/95 7.13 0.38 0.89 1.27 (0.38) -- (0.38)
12/31/94 8.04 0.39 (0.91) (0.52) (0.39) -- (0.39)
CLASS B
04/30/00 (unaudited) 7.41 0.17 (0.05) 0.12 (0.17) -- (0.17)
10/31/99 8.11 0.35 (0.70) (0.35) (0.35) -- (0.35)
10/31/98(a) 8.09 0.28 0.03 0.31 (0.29) -- (0.29)
12/31/97 7.83 0.32 0.27 0.59 (0.32) (0.01) (0.33)
12/31/96 8.02 0.31 (0.19) 0.12 (0.31) -- (0.31)
12/31/95 7.13 0.32 0.89 1.21 (0.32) -- (0.32)
12/31/94(c) 7.49 0.25 (0.36) (0.11) (0.25) -- (0.25)
================
<FN>
* Annualized.
+ Total return is not annualized for the periods less than one year and does
not reflect any applicable sales charges. The total returns would have been
lower if fees had not been reduced by credits allowed by the custodian.
(a) Fiscal year end changed to October 31 from December 31.
(b) Ratio of operating expenses to average net assets includes expenses paid
indirectly beginning in fiscal year 1995.
(c) On March 30, 1994 the Fund commenced selling Class B shares.
</FN>
See Notes to Financial Statements.
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
-------------------------------------------------------------------------
NET ASSETS, RATIO OF RATIO OF NET
NET ASSET VALUE, END OF PERIOD OPERATING EXPENSES INVESTMENT INCOME TO PORTFOLIO
END OF PERIOD TOTAL RETURN+ (IN 000'S) TO AVERAGE NET ASSETS(A) AVERAGE NET ASSETS TURNOVER RATE
--------------- ------------- ------------- ------------------------ -------------------- -------------
<S> <C> <C> <C> <C> <C> <C>
CLASS A
04/30/00 (unaudited)$7.36 2.07% $216,290 0.88%* 5.49%* 12%
10/31/99 7.41 (3.77)% 247,814 0.89% 5.16% 57%
10/31/98(a) 8.11 4.58% 301,162 0.84%* 5.14%* 6%
12/31/97 8.09 8.59% 188,021 0.80% 4.84% 21%
12/31/96 7.83 2.52% 203,606 0.75% 4.90% 22%
12/31/95 8.02 18.25% 230,055 0.81% 5.03% 8%
12/31/94 7.13 (6.53)% 215,438 0.79% 5.23% 12%
CLASS B
04/30/00 (unaudited) 7.36 1.69% 24,349 1.62%* 4.75%* 12%
10/31/99 7.41 (4.52)% 25,059 1.64% 4.41% 57%
10/31/98(a) 8.11 3.88% 17,344 1.62%* 4.36%* 6%
12/31/97 8.09 7.71% 8,110 1.62% 4.00% 21%
12/31/96 7.83 1.61% 5,266 1.65% 4.01% 22%
12/31/95 8.02 17.30% 2,682 1.62% 4.18% 8%
12/31/94(c) 7.13 (1.46)% 1,258 1.58%* 4.53%* 12%
</TABLE>
40 & 41
<PAGE>
FINANCIAL HIGHLIGHTS
CALIFORNIA MUNICIPAL FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD.
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS LESS DISTRIBUTIONS
---------------------------------------- --------------------------------------------
NET REALIZED DISTRIBUTIONS
NET ASSET VALUE, AND UNREALIZED TOTAL FROM DIVIDENDS FROM FROM
BEGINNING OF NET INVESTMENT GAIN/(LOSS) ON INVESTMENT NET INVESTMENT NET REALIZED TOTAL
PERIOD INCOME INVESTMENTS OPERATIONS INCOME CAPITAL GAINS DISTRIBUTIONS
---------------- -------------- -------------- ---------- -------------- -------------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
CLASS A
04/30/00 (unaudited)$10.43 $ 0.28 $ 0.01 $ 0.29 $(0.28) $-- $(0.28)
10/31/99 11.46 0.54 (0.94) (0.40) (0.57) (0.06) (0.63)
10/31/98(a) 11.33 0.19++ 0.13 0.32 (0.19) -- (0.19)
06/30/98 10.92 0.58++ 0.41 0.99 (0.58) -- (0.58)
06/30/97 10.60 0.59 0.32 0.91 (0.59) -- (0.59)
06/30/96 10.53 0.60++ 0.07 0.67 (0.60) -- (0.60)
06/30/95 10.38 0.61 0.15 0.76 (0.61) (0.00)# (0.61)
CLASS B
04/30/00 (unaudited) 10.43 0.24 0.01 0.25 (0.24) -- (0.24)
10/31/99 11.46 0.48 (0.97) (0.49) (0.48) (0.06) (0.54)
10/31/98(a) 11.33 0.16++ 0.13 0.29 (0.16) -- (0.16)
06/30/98 10.92 0.50++ 0.41 0.91 (0.50) -- (0.50)
06/30/97 10.60 0.51 0.32 0.83 (0.51) -- (0.51)
06/30/96 10.53 0.51++ 0.07 0.58 (0.51) -- (0.51)
06/30/95(c) 10.38 0.53 0.15 0.68 (0.53) (0.00)# (0.53)
-----------------------------------------------------------------------------------------------------------------------------
<FN>
* Annualized.
+ Total return is not annualized for periods less than one year and does not
reflect any applicable sales charges. The total returns would have been
lower if certain fees had not been waived by the investment advisor or if
fees had not been reduced by credits allowed by the custodian.
++ Per share numbers have been calculated using the average shares method.
# Amount represents less than $0.01 per share.
(a) Fiscal year end changed to October 31 from June 30.
(b) Ratio of operating expenses to average net assets includes expenses paid
indirectly beginning in fiscal year 1995.
(c) On July 1, 1994 the Fund commenced selling Class B shares.
</FN>
See Notes to Financial Statements.
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
----------------------------------------------------------------------------------------
RATIO OF OPERATING
EXPENSES TO AVERAGE
NET ASSETS WITHOUT FEE
WAIVERS AND/OR FEES
NET ASSETS, RATIO OF RATIO OF NET PORTFOLIO REDUCED CREDITS
NET ASSET VALUE, TOTAL END OF PERIOD OPERATING EXPENSES INVESTMENT INCOME TO TURNOVER ALLOWED BY THE
END OF PERIOD RETURN+ (IN 000'S) TO AVERAGE NET ASSETS(B) AVERAGE NET ASSETS RATE CUSTODIAN
--------------- --------- ------------- ------------------------ -------------------- ------------- -----------------
<S> <C> <C> <C> <C> <C> <C> <C>
CLASS A
04/30/00 (unaudited)$10.44 2.87% $247,314 0.88%* 5.32%* 36% 0.89%*
10/31/99 10.43 (3.87)% 283,929 0.88% 4.94% 92% 0.91%
10/31/98(a) 11.46 2.82% 287,590 0.97%* 4.87%* 28% 1.05%*
06/30/98 11.33 9.26% 290,328 1.00% 5.18% 87% 1.19%
06/30/97 10.92 8.83% 318,251 0.97% 5.51% 36% 1.26%
06/30/96 10.60 6.40% 372,177 0.94% 5.56% 17% 1.29%
06/30/95 10.53 7.57% 405,967 0.85% 5.89% 22% 1.29%
CLASS B
04/30/00 (unaudited) 10.44 2.50% 137,624 1.61%* 4.59%* 36% 1.62%*
10/31/99 10.43 (4.62)% 133,842 1.63% 4.19% 92% 1.66%
10/31/98(a) 11.46 2.56% 49,683 1.72%* 4.12%* 28% 1.81%*
06/30/98 11.33 8.45% 34,537 1.75% 4.42% 87% 1.95%
06/30/97 10.92 8.02% 25,219 1.72% 4.76% 36% 2.01%
06/30/96 10.60 5.61% 20,543 1.69% 4.81% 17% 2.04%
06/30/95(c) 10.53 6.78% 7,230 1.60% 5.14% 22% 2.04%
</TABLE>
42 & 43
<PAGE>
FINANCIAL HIGHLIGHTS
CALIFORNIA INSURED INTERMEDIATE MUNICIPAL FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD.
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS LESS DISTRIBUTIONS
-------------------------------------------- -----------------------------------
NET REALIZED DISTRIBUTIONS IN
NET ASSET VALUE, AND UNREALIZED TOTAL FROM DIVIDENDS FROM EXCESS OF NET
BEGINNING OF NET INVESTMENT GAIN/(LOSS) ON INVESTMENT NET INVESTMENT INVESTMENT
PERIOD INCOME INVESTMENTS OPERATIONS INCOME INCOME
---------------- -------------- -------------- ---------- -------------- --------------
CLASS A
<S> <C> <C> <C> <C> <C> <C>
04/30/00 (unaudited) $ 10.30 $ 0.21 $ 0.02 $ 0.23 $(0.21) $--
10/31/99 11.02 0.44++ (0.55) (0.11) (0.45) --
10/31/98(a) 10.81 0.16 0.21 0.37 (0.16) --
06/30/98 10.74 0.49 0.17 0.66 (0.49) (0.00)#
06/30/97 10.56 0.49++ 0.23 0.72 (0.49) --
06/30/96 10.45 0.49 0.15 0.64 (0.49) --
06/30/95 10.10 0.50 0.35 0.85 (0.50) --
CLASS B
04/30/00 (unaudited) 10.30 0.18 0.02 0.20 (0.18) --
10/31/99 11.02 0.36++ (0.56) (0.20) (0.36) --
10/31/98(a) 10.81 0.13 0.21 0.34 (0.13) --
06/30/98 10.74 0.41 0.17 0.58 (0.41) (0.00)#
06/30/97 10.56 0.41++ 0.23 0.64 (0.41) --
06/30/96 10.45 0.41 0.15 0.56 (0.41) --
06/30/95(c) 10.10 0.43 0.35 0.78 (0.43) --
======================
<FN>
* Annualized.
+ Total return is not annualized for periods less than one year and does not
reflect any applicable sales charges. The total returns would have been
lower if certain fees had not been waived and expenses reimbursed by the
investment advisor or if fees had not been reduced by credits allowed by the
custodian.
++ Per share numbers have been calculated using the average shares method.
# Amount represents less than $0.01 per share.
(a) Fiscal year end changed to October 31 from June 30.
(b) Ratio of operating expenses to average net assets includes expenses paid
indirectly beginning in fiscal year 1995.
(c) On July 1, 1994 the Fund commenced selling Class B shares.
</FN>
</TABLE>
See Notes to Financial Statements.
<TABLE>
<CAPTION>
RATIOS TO AVERAGE
LESS DISTRIBUTIONS NET ASSETS/SUPPLEMENTAL DATA
-------------------------------- -----------------------------------------
DISTRIBUTIONS
FROM NET ASSETS, RATIO OF
NET REALIZED TOTAL NET ASSET VALUE, END OF PERIOD OPERATING EXPENSES
CAPITAL GAINS DISTRIBUTIONS END OF PERIOD TOTAL RETURN+ (IN 000'S) TO AVERAGE NET ASSETS(B)
-------------- ------------- --------------- ------------- ------------- -----------------------
CLASS A
<S> <C> <C> <C> <C> <C> <C>
04/30/00 (unaudited) $ (0.03) $(0.24) $ 10.29 2.25% $28,382 0.92%*
10/31/99 (0.16) (0.61) 10.30 (1.11)% 31,253 0.89%
10/31/98(a) -- (0.16) 11.02 3.46% 37,529 0.82%*
06/30/98 (0.10) (0.59) 10.81 6.26% 38,724 0.86%
06/30/97 (0.05) (0.54) 10.74 6.97% 45,157 0.82%
06/30/96 (0.04) (0.53) 10.56 6.25% 54,518 0.73%
06/30/95 -- (0.50) 10.45 8.71% 54,507 0.42%
CLASS B
04/30/00 (unaudited) (0.03) (0.21) 10.29 1.87% 33,910 1.66%*
10/31/99 (0.16) (0.52) 10.30 (1.89)% 35,501 1.64%
10/31/98(a) -- (0.13) 11.02 3.20% 23,960 1.57%*
06/30/98 (0.10) (0.51) 10.81 5.47% 21,688 1.61%
06/30/97 (0.05) (0.46) 10.74 6.17% 20,992 1.57%
06/30/96 (0.04) (0.45) 10.56 5.46% 20,948 1.48%
06/30/95(c) -- (0.43) 10.45 7.90% 12,391 1.17%
======================
</TABLE>
<TABLE>
<CAPTION>
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
-------------------------------------------------------------
RATIO OF OPERATING
EXPENSES TO AVERAGE
NET ASSETS WITHOUT FEE
WAIVERS AND/OR FEES
RATIO OF NET REDUCED BY CREDITS
INVESTMENT INCOME TO PORTFOLIO ALLOWED BY THE
AVERAGE NET ASSETS TURNOVER RATE CUSTODIAN
-------------------- ------------- ----------------------
CLASS A
<S> <C> <C> <C>
04/30/00 (unaudited) 4.18%* 26% 0.94%*
10/31/99 4.13% 93% 0.97%
10/31/98(a) 4.39%* 7% 1.15%*
06/30/98 4.49% 25% 1.25%
06/30/97 4.61% 29% 1.31%
06/30/96 4.62% 27% 1.39%
06/30/95 4.95% 13% 1.41%
CLASS B
04/30/00 (unaudited) 3.44%* 26% 1.68%*
10/31/99 3.38% 93% 1.72%
10/31/98(a) 3.64%* 7% 1.90%*
06/30/98 3.74% 25% 2.01%
06/30/97 3.86% 29% 2.06%
06/30/96 3.87% 27% 2.14%
06/30/95(c) 4.20% 13% 2.16%
======================
</TABLE>
44 & 45
<PAGE>
FINANCIAL HIGHLIGHTS
FLORIDA INSURED MUNICIPAL FUND
FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD.
<TABLE>
<CAPTION>
INCOME FROM INVESTMENT OPERATIONS LESS DISTRIBUTIONS
------------------------------------- --------------------------------------------
NET REALIZED DISTRIBUTIONS
NET ASSET VALUE, AND UNREALIZED TOTAL FROM DIVIDENDS FROM IN EXCESS OF
BEGINNING OF NET INVESTMENT GAIN/(LOSS) ON INVESTMENT NET INVESTMENT NET INVESTMENT TOTAL
PERIOD INCOME INVESTMENTS OPERATIONS INCOME INCOME DISTRIBUTIONS
--------------- -------------- -------------- ----------- -------------- -------------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
CLASS A
04/30/00 (unaudited) $ 9.60 $ 0.23 $ (0.09) $ 0.14 $ (0.23) $ -- $(0.23)
10/31/99 10.50 0.48 (0.90) (0.42) (0.48) -- (0.48)
10/31/98(a) 10.35 0.17 0.15 0.32 (0.17) -- (0.17)
06/30/98 9.93 0.49 0.42 0.91 (0.49) -- (0.49)
06/30/97 9.64 0.49++ 0.30 0.79 (0.50) (0.00)# (0.50)
06/30/96 9.43 0.50 0.21 0.71 (0.50) -- (0.50)
06/30/95 9.40 0.52 0.03## 0.55 (0.52) -- (0.52)
CLASS B
04/30/00 (unaudited) 9.60 0.20 (0.10) 0.10 (0.19) -- (0.19)
10/31/99 10.50 0.40 (0.90) (0.50) (0.40) -- (0.40)
10/31/98(a) 10.35 0.14 0.15 0.29 (0.14) -- (0.14)
06/30/98 9.93 0.41 0.43 0.84 (0.42) -- (0.42)
06/30/97 9.64 0.42++ 0.30 0.72 (0.43) (0.00)# (0.43)
06/30/96 9.43 0.42 0.21 0.63 (0.42) -- (0.42)
06/30/95(c) 9.40 0.45 0.03## 0.48 (0.45) -- (0.45)
================================
<FN>
* Annualized.
+ Total return is not annualized for periods less than one year and does not
reflect any applicable sales charges. The total returns would have been
lower if certain fees had not been waived and expenses reimbursed by the
investment advisor or if fees had not been reduced by credits allowed by the
custodian.
++ Per share numbers have been calculated using the average shares method.
# Amount represents less than $0.01 per share.
## The amount shown may not accord with the change in aggregate gains and
losses of portfolio securities due to the timing of sales and redemptions of
Fund shares.
(a) Fiscal year end changed to October 31 from June 30.
(b) Ratio of operating expenses to average net assets includes expenses paid
indirectly beginning in fiscal year 1995.
(c) On July 1, 1994 the Fund commenced selling Class B shares.
</FN>
</TABLE>
See Notes to Financial Statements.
<TABLE>
<CAPTION>
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
-----------------------------------------------------------
NET ASSETS, RATIO OF RATIO OF NET
NET ASSET VALUE, TOTAl END OF PERIOD OPERATING EXPENSES INVESTMENT INCOME TO PORTFOLIO
END OF PERIOD RETURN+ (IN 000'S) TO AVERAGE NET ASSETS(B) AVERAGE NET ASSETS TURNOVER RATE
--------------- ------- ------------- ------------------------ ------------------- -------------
<S> <C> <C> <C> <C> <C> <C>
CLASS A
04/30/00 (unaudited) $9.51 1.46% $ 9,919 1.12%* 4.82%* 30%
10/31/99 9.60 (4.14)% 12,015 0.97% 4.68% 104%
10/31/98(a) 10.50 3.08% 15,813 0.82%* 4.76%* 40%
06/30/98 10.35 9.34% 16,538 0.88% 4.79% 51%
06/30/97 9.93 8.43% 22,761 0.82% 5.01% 53%
06/30/96 9.64 7.56% 29,821 0.63% 5.08% 52%
06/30/95 9.43 6.01% 33,714 0.39% 5.53% 44%
CLASS B
04/30/00 (unaudited) 9.51 1.08% 6,210 1.86%* 4.08%* 30%
10/31/99 9.60 (4.91)% 7,273 1.71% 3.94% 104%
10/31/98(a) 10.50 2.82% 6,054 1.57%* 4.01%* 40%
06/30/98 10.35 8.53% 5,075 1.63% 4.04% 51%
06/30/97 9.93 7.63% 5,067 1.57% 4.26% 53%
06/30/96 9.64 6.76% 5,428 1.38% 4.33% 52%
06/30/95(c) 9.43 5.23% 3,330 1.14% 4.78% 44%
</TABLE>
================================
<TABLE>
<CAPTION>
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
----------------------------------------------
RATIO OF OPERATING
EXPENSES TO AVERAGE
NET ASSETS WITHOUT FEE
WAIVERS AND/OR FEES
REDUCED BY CREDITS
ALLOWED BY THE
CUSTODIAN
-----------------------
<S> <C>
CLASS A
04/30/00 (unaudited) 1.14%*
10/31/99 1.14%
10/31/98(a) 1.40%*
06/30/98 1.45%
06/30/97 1.46%
06/30/96 1.46%
06/30/95 1.51%
CLASS B
04/30/00 (unaudited) 1.88%*
10/31/99 1.88%
10/31/98(a) 2.15%*
06/30/98 2.21%
06/30/97 2.21%
06/30/96 2.21%
06/30/95(c) 2.26%
</TABLE>
================================
46 & 47
<PAGE>
PORTFOLIO OF INVESTMENTS
BOND & STOCK FUND
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
SHARES VALUE
------ -----
COMMON STOCKS - 60.7%
REAL ESTATE INVESTMENT TRUSTS - 6.2%
<S> <C> <C>
60,000 Arden Realty Inc. ............... $ 1,335,000
74,800 CarrAmerica Realty Corporation .. 1,776,500
40,000 Essex Property Trust Inc. ....... 1,545,000
75,000 Franchise Finance Corporation
of America .................... 1,781,250
48,700 Health Care Property Investors Inc. 1,357,514
80,000 Hospitality Properties Trust .... 1,780,000
73,300 Shurgard Storage Centers, Inc.,
Class A ......................... 1,919,544
65,000 Simon Property Group Inc. ....... 1,649,375
58,500 Storage USA Inc. ................ 1,711,125
110,500 Taubman Centers Inc. ............ 1,319,094
-------------
16,174,402
-------------
CONSUMER STAPLES - 5.9%
111,000 Albertson's Inc. ................ 3,614,437
30,000 Energizer Holdings, Inc.+ ....... 511,874
98,000 Fort James Corporation .......... 2,345,875
100,000 PepsiCo Inc. .................... 3,668,750
62,500 Philip Morris Companies, Inc. ... 1,367,187
90,000 Ralston-Ralston Purina Group .... 1,591,875
113,000 Supervalu Inc. .................. 2,337,687
-------------
15,437,685
-------------
HEALTH CARE PRODUCTS - 5.9%
37,000 Abbott Laboratories ............. 1,422,187
36,000 Baxter International Inc. ....... 2,344,500
85,600 Becton Dickinson & Company ...... 2,193,500
46,700 Cardinal Health, Inc. ........... 2,571,419
75,000 DENTSPLY International Inc. ..... 2,179,688
7,200 Edwards Lifesciences Corporation+ 108,000
21,100 Johnson & Johnson ............... 1,740,750
100,000 Mylan Laboratories Inc. ......... 2,837,500
-------------
15,397,544
-------------
BANKS/SAVINGS & LOANS - 5.9%
30,975 Bank of America Corporation ..... 1,517,775
28,500 Bank One Corporation ............ 869,250
22,200 Chase Manhattan Corporation ..... 1,599,787
55,000 Citigroup Inc. .................. 3,269,062
89,551 First State Bancorporation ...... 1,164,163
107,000 Mellon Bank Corporation ......... 3,437,375
85,000 Wells Fargo & Company ........... 3,490,312
-------------
15,347,724
-------------
OIL & GAS - 4.4%
12,304 Arch Coal, Inc. ................. 66,134
50,000 Ashland, Inc. ................... 1,706,250
150,000 Repsol, Sponsored ADR ........... 3,093,750
96,500 Tosco Corporation ............... 3,094,031
SHARES VALUE
------ -----
63,200 Ultramar Diamond Shamrock
Corporation ................... $ 1,564,200
70,000 Valero Energy Corporation ....... 2,030,000
-------------
11,554,365
-------------
FINANCIAL SERVICES - 3.9%
48,800 Fannie Mae ...................... 2,943,250
85,000 Finova Group Inc. ............... 1,089,062
60,000 Franklin Resources Inc. ......... 1,935,000
60,000 Price (T. Rowe) Associates Inc. . 2,287,500
22,000 Providian Financial Corporation 1,937,375
-------------
10,192,187
-------------
RETAIL SALES - 3.8%
190,000 Blockbuster Inc., Class A+ ...... 1,971,250
50,000 Limited, Inc. ................... 2,259,375
76,650 May Department Stores Company ... 2,107,875
120,000 Penney (J.C.) Company Inc. ...... 1,657,500
94,000 Ross Stores Inc. ................ 1,950,500
-------------
9,946,500
-------------
COMPUTER SYSTEMS - 3.6%
150,000 Diebold Inc. .................... 4,331,250
27,350 Hewlett-Packard Company ......... 3,692,250
12,000 International Business Machines
Corporation ................... 1,339,500
-------------
9,363,000
-------------
HEALTH CARE SERVICES - 3.0%
30,600 Aetna, Inc. ..................... 1,770,975
58,000 Columbia/HCA Healthcare Corporation 1,649,375
200,000 HEALTHSOUTH Corporation+ ........ 1,612,500
44,000 UnitedHealth Group Inc. ......... 2,934,250
-------------
7,967,100
-------------
COMPUTER SOFTWARE/SERVICES - 2.4%
30,000 Autodesk, Inc. .................. 1,151,250
93,000 Computer Associates International
Inc. .......................... 5,190,562
-------------
6,341,812
-------------
BASIC INDUSTRY - 2.1%
46,000 Bemis Company, Inc.+ ............ 1,693,375
68,500 Engelhard Corporation ........... 1,203,031
150,000 Republic Services Inc.+ ......... 2,053,125
38,400 Waste Management, Inc. .......... 609,600
-------------
5,559,131
-------------
CAPITAL GOODS - 2.0%
36,000 American Standard Companies Inc.+ 1,476,000
101,250 Crane Company ................... 2,721,094
25,500 Grainger (W.W.) Inc. ............ 1,106,062
-------------
5,303,156
-------------
</TABLE>
See Notes to Financial Statements.
48
<PAGE>
PORTFOLIO OF INVESTMENTS (CONTINUED)
BOND & STOCK FUND
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
SHARES VALUE
------ -----
COMMON STOCKS (CONTINUED)
UTILITIES/TELECOMMUNICATIONS - 2.0%
<S> <C> <C>
25,600 Alltel Corporation .............. $ 1,705,600
57,500 Sprint Corporation, FON Group ... 3,536,250
704 Winstar Communications, Inc.+ ... 28,052
-------------
5,269,902
-------------
INSURANCE - 2.0%
86,200 Conseco Inc. .................... 468,713
20,600 John Hancock Financial Services
Inc.+ ......................... 375,950
87,500 MGIC Investment Corporation ..... 4,183,594
10,500 UnumProvident Corporation ....... 178,500
-------------
5,206,757
-------------
AEROSPACE/DEFENSE - 1.8%
33,200 Boeing Company .................. 1,317,625
45,000 General Dynamics Corporation .... 2,632,500
40,000 Raytheon Company, Class B ....... 887,500
-------------
4,837,625
-------------
CONSUMER CYCLICALS - 1.8%
58,500 Liz Claiborne Inc. .............. 2,709,281
200,000 The Warnaco Group Inc. .......... 2,125,000
-------------
4,834,281
-------------
MEDIA - 1.6%
60,000 Harcourt General Inc. ........... 2,242,500
35,000 Viacom Inc., Class A+ ........... 1,918,438
-------------
4,160,938
-------------
ELECTRICAL EQUIPMENT - 1.0%
42,850 Tektronix Inc. .................. 2,479,944
-------------
BUSINESS SERVICES - 0.7%
58,500 Dun & Bradstreet Corporation .... 1,762,312
-------------
LODGING & RESTAURANTS - 0.7%
60,000 Starwood Hotels & Resorts
Worldwide Inc. ............... 1,706,250
-------------
Total Common Stocks
(Cost $129,565,246) ......... 158,842,615
-------------
CONVERTIBLE PREFERRED STOCKS - 7.8%
50,000 Bank United Corporation, Conv. Pfd.,
8.000% due 08/16/2004 ......... 2,225,000
115,000 Cendant Corporation, Series CD,
Conv. Pfd.,
1.300% due 02/16/2001 ......... 2,415,000
40,000 DECS Trust VI, Conv. Pfd.,
6.250% due 11/15/2002 ......... 2,130,000
6,000 Global Crossing Holdings Ltd.,
Conv. Pfd.,
6.375% due 11/05/2004++ ....... 1,231,500
36,500 Loral Space & Communications, Ltd.,
Series C, Conv. Pfd.,
6.000% due 11/01/2006++ ....... 1,140,625
36,400 PSINet Inc., Conv. Pfd., Series C,
6.750% due 05/05/2002 ......... 1,747,200
35,350 Qwest Trends Trust, Conv. Pfd.,
5.750% due 11/17/2003++ ....... 2,536,363
SHARES VALUE
------ -----
11,200 TCI Pacific Communications Inc.,
Conv. Pfd.,
5.000% due 07/31/2006 ......... $ 3,312,400
100,000 Tribune Company, Conv. Pfd.,
6.250% due 08/15/2001 ......... 1,550,000
1,890 Winstar Communications Inc.,
Conv. Pfd.,
7.250% due 06/22/2002++ ....... 2,140,425
-------------
Total Convertible Preferred Stocks
(Cost $18,965,086) ............ 20,428,513
-------------
PRINCIPAL
AMOUNT
---------
FIXED INCOME SECURITIES - 30.1%
CORPORATE BONDS AND NOTES - 16.2%
$1,500,000 Aetna Services Inc.,
Company Guarantee,
7.625% due 08/15/2026 1,348,106
1,250,000 American Home Products Corporation,
Deb., 7.250% due 03/01/2023 ... 1,173,073
2,000,000 Cendant Corporation, Note,
7.750% due 12/01/2003 ......... 1,972,384
2,500,000 Citicorp, Sub. Note,
7.200% due 06/15/2007 ......... 2,426,955
2,000,000 CNA Financial Corporation,
Note,
6.600% due 12/15/2008 ......... 1,674,510
1,000,000 Coastal Corporation, Note,
9.625% due 05/15/2012 ......... 1,116,168
Conagra Inc., Sr. Note:
750,000 9.750% due 03/01/2021 ......... 824,178
1,000,000 6.700% due 08/01/2027 ......... 917,737
1,000,000 Continental Corporation, Note,
7.250% due 03/01/2003 ......... 957,821
500,000 Developers Diversified Realty,
MTN, Sr. Note,
6.580% due 02/06/2001 ......... 494,335
Federal National Mortgage
2,000,000 Association: Deb.,
8.250% due 12/18/2000 ......... 2,023,248
2,000,000 Note,
6.000% due 05/15/2008 ......... 1,841,780
2,000,000 FHP International Corporation,
Sr. Note,
7.000% due 09/15/2003 ......... 1,894,414
1,250,000 First Nationwide Bank, Sub. Deb.,
10.000% due 10/01/2006 ........ 1,369,925
Franchise Finance Corporation,
Sr. Note:
1,000,000 7.000% due 11/30/2000 ......... 994,402
1,000,000 7.875% due 11/30/2005 ......... 956,474
1,165,000 HEALTHSOUTH Corporation, Sr. Note,
6.875% due 06/15/2005 ......... 998,193
2,000,000 Loral Corporation, Deb.,
7.625% due 06/15/2025 ......... 1,802,522
1,000,000 Medpartners Inc., Sr. Note,
7.375% due 10/01/2006 ......... 815,000
1,000,000 Mercantile Bank, Sub. Note,
7.625% due 10/15/2002 ......... 994,850
2,500,000 Merrill Lynch & Company Inc.,
Note,
6.375% due 10/15/2008 ........... 2,268,603
</TABLE>
See Notes to Financial Statements.
49
<PAGE>
PORTFOLIO OF INVESTMENTS (CONTINUED)
BOND & STOCK FUND
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
--------- -----
FIXED INCOME SECURITIES (CONTINUED)
CORPORATE BONDS AND NOTES (CONTINUED)
<S> <C> <C>
Niagara Mohawk Power Corporation,
Deb.:
$ 1,100,000 9.500% due 06/01/2000 ......... $ 1,101,874
961,000 8.770% due 01/01/2018 ......... 1,008,240
1,000,000 Price/Costco Inc., Sr. Note,
7.125% due 06/15/2005 ......... 979,280
1,750,000 Raytheon Company, Deb.,
7.200% due 08/15/2027 ......... 1,481,664
500,000 Summit Bancorp, Sub. Note,
8.625% due 12/10/2002 ......... 508,798
1,500,000 Superior Financial Acquisition
Corporation, Sr. Note,
8.650% due 04/01/2003 ......... 1,443,318
1,000,000 Tenet Healthcare Corporation,
Sr. Note,
7.875% due 01/15/2003 ......... 977,500
2,000,000 Texas-New Mexico Power Company,
Sr. Note,
6.250% due 01/15/2009 ......... 1,675,096
2,000,000 Time Warner Inc., Deb.,
9.150% due 02/01/2023 ......... 2,170,918
4,500,000 V2 Music Holdings Plc,
Sr. Discount Note,
Zero coupon to 04/15/2003;
14.000% due 04/15/2008++ ...... 1,327,500
1,000,000 Westinghouse Electric Corporation,
Deb.,
7.875% due 09/01/2023 ......... 986,396
-------------
Total Corporate Bonds and Notes
(Cost $45,404,909) ............ 42,525,262
-------------
U.S. GOVERNMENT AGENCY MORTGAGE-BACKED
SECURITIES - 5.1%
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION (GNMA) - 4.7%
Government National Mortgage Association:
206,505 10.000% due 08/15/2019 ......... 219,908
1,344,348 6.375% due 01/20/2023 ......... 1,356,283
1,873,886 6.500% due 01/15/2024 ......... 1,757,231
1,118,336 7.000% due 12/15/2025 ......... 1,076,536
99,357 6.000% due 01/15/2026 ......... 90,359
687,183 6.000% due 02/15/2026 ......... 624,948
1,064,942 6.500% due 03/15/2026 ......... 998,646
910,822 6.500% due 04/15/2026 ......... 854,121
1,384,875 6.500% due 04/15/2026 ......... 1,298,662
1,118,977 6.500% due 05/15/2026 ......... 1,049,318
1,118,498 7.000% due 03/15/2027 ......... 1,076,692
1,259,857 7.000% due 03/15/2028 ......... 1,212,887
768,126 6.500% due 04/15/2026 ......... 720,308
-------------
Total GNMAs (Cost $12,611,402) .. 12,335,899
-------------
FEDERAL HOME LOAN MORTGAGE CORPORATION (FHLMC) - 0.4%
992,233 #C29918, GOLD,
6.500% due 08/01/2029 ......... 927,363
-------------
Total U.S. Government Agency Mortgage-
Backed Securities
(Cost $13,538,210) ............ 13,263,262
-------------
PRINCIPAL
AMOUNT VALUE
--------- -----
CONVERTIBLE BONDS AND NOTES - 4.2%
$ 1,450,000 Chiquita Brands International Inc.,
Conv. Note,
7.000% due 03/28/2001++ ....... $ 1,218,000
1,080,000 CII Financial Inc., Conv. Note,
7.500% due 09/15/2001 ......... 753,300
1,663,000 EXCITE@HOME, Conv. Sub. Note,
4.750% due 12/15/2006++ ....... 1,114,210
4,000,000 Network Associates Inc.,
Conv. Bond,
Zero coupon due 02/13/2018 .... 1,430,000
1,720,000 Orbital Sciences Corporation,
Conv. Sub. Note,
5.000% due 10/01/2002 ......... 1,231,950
1,750,000 Rockefeller Center Properties
Trust, Conv. Deb.,
Zero coupon due 12/31/2000 .... 1,478,750
2,200,000 Veterinary Centers of America,
Conv. Sub. Deb.,
5.250% due 05/01/2006** ....... 1,927,750
2,000,000 Waste Management Inc., Conv. Deb.,
4.000% due 02/01/2002 ......... 1,790,000
-------------
Total Convertible Bonds and Notes
(Cost $12,008,842) ............ 10,943,960
-------------
U.S. TREASURY OBLIGATIONS - 3.4%
U.S. TREASURY NOTES - 2.7%
1,000,000 6.375% due 08/15/2002** ......... 994,375
5,000,000 6.500% due 10/15/2006** ......... 4,992,190
1,000,000 7.500% due 11/15/2016** ......... 1,119,688
-------------
7,106,253
-------------
U.S. TREASURY STRIP (PRINCIPAL ONLY) - 0.7%
4,000,000 Zero coupon due 08/15/2012 ...... 1,841,868
-------------
Total U.S. Treasury Obligations
(Cost $8,615,648) ............. 8,948,121
-------------
COLLATERALIZED MORTGAGE OBLIGATIONS (CMO) - 1.2%
1,250,000 Donaldson, Lufkin & Jenrette
Acceptance Corporation,
1993-M17 A2,
7.350% due 12/18/2003 .......... 1,248,215
56,234 Merrill Lynch Mortgage Investors Inc.,
1988 PA,
10.050% due 12/15/2008 ........ 56,655
354,477 Resolution Trust Corporation,
1991-M2 A2,
7.132% due 09/25/2020 ......... 337,038
1,460,376 Weyerhaeuser Mortgage Corporation,
1982-C FHA Putable,
7.430% due 06/01/2022 ......... 1,449,077
-------------
Total CMOs (Cost $3,001,930) .... 3,090,985
-------------
Total Fixed Income Securities
(Cost $82,569,539) ............ 78,771,590
-------------
SHARES
------
WARRANT - 0.0%#
(COST $45)
4,500 V2 Music Holdings Plc,
Expires 04/15/2008+,++ ........ 45
-------------
</TABLE>
See Notes to Financial Statements.
50
<PAGE>
PORTFOLIO OF INVESTMENTS (CONTINUED)
BOND & STOCK FUND
APRIL 30, 2000 (UNAUDITED)
PRINCIPAL
AMOUNT VALUE
--------- -----
REPURCHASE AGREEMENT - 0.7%
(COST $1,821,000)
$ 1,821,000 Agreement with Goldman Sachs &
Company, 5.640% dated 04/28/2000,
to be repurchased at $1,821,856
on 05/01/2000, collateralized by
$1,567,139 U.S. Treasury Note,
7.500% due 11/15/2024 (Market
Value $1,865,283) ............. $ 1,821,000
------------
TOTAL INVESTMENTS (Cost $232,920,916*) .. 99.3% 259,863,763
OTHER ASSETS AND LIABILITIES (NET) ...... 0.7 1,810,428
----- ------------
NET ASSETS .............................. 100.0% $261,674,191
===== ============
======================
* Aggregate cost for federal tax purposes.
** Securities on loan at April 30, 2000, which have an aggregate market value of
$8,665,539, represent 3.3% of the total net assets of the Fund (Note 7).
# Amount represents less than 0.1% of net assets.
+ Non-income producing security.
++ Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers.
--------------------------------------------------------------------------------
GLOSSARY OF TERMS
ADR -- American Depositary Receipt
FHA -- Federal Housing Authority
GOLD -- Payments are on an accelerated 45-day payment cycle instead of
75-day payment cycle
MTN -- Medium Term Note
STRIP -- Separate trading of registered interest and principal securities
--------------------------------------------------------------------------------
See Notes to Financial Statements.
51
<PAGE>
PORTFOLIO OF INVESTMENTS
GROWTH & INCOME FUND
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
SHARES VALUE
------ -----
COMMON STOCKS - 98.9%
BANKS/SAVINGS & LOANS - 11.3%
<S> <C> <C>
800,000 Bank of America Corporation .. $ 39,200,000
229,900 Chase Manhattan Corporation .. 16,567,169
604,048 Citigroup Inc. ............... 35,903,103
700,000 First Union Corporation ...... 22,312,500
520,000 Mellon Financial Corporation . 16,705,000
1,050,462 Wells Fargo & Company ........ 43,134,596
-------------
173,822,368
-------------
HEALTH CARE PRODUCTS - 9.9%
224,200 Abbott Laboratories .......... 8,617,688
285,000 American Home Products Corporation 16,013,438
300,000 Bristol-Meyers Squibb Company 15,731,250
610,000 Cardinal Health Inc. ......... 33,588,125
193,800 Johnson & Johnson ............ 15,988,500
196,400 Merck & Company Inc. ......... 13,649,800
1,300,000 Mylan Laboratories Inc. ...... 36,887,500
275,000 Pfizer Inc. .................. 11,584,375
-------------
152,060,676
-------------
COMPUTER SOFTWARE/SERVICES - 9.9%
250,000 Adobe Systems Inc. ........... 30,234,375
744,000 BMC Software Inc.+ ........... 34,828,500
430,000 Computer Associates International
Inc. ....................... 23,999,375
286,000 First Data Corporation ....... 13,924,625
352,000 Microsoft Corporation+ ....... 24,552,000
300,000 Oracle Corporation+ .......... 23,981,250
-------------
151,520,125
-------------
CONSUMER STAPLES - 8.7%
738,000 Avon Products Inc. ........... 30,627,000
324,000 Kimberly-Clark Corporation ... 18,812,250
2,400,000 Kroger Company+ .............. 44,550,000
483,000 PepsiCo Inc. ................. 17,720,062
200,000 Procter & Gamble Company ..... 11,925,000
706,600 Sara Lee Corporation ......... 10,599,000
-------------
134,233,312
-------------
COMPUTER SYSTEMS - 8.5%
320,000 Cisco Systems Inc.+ .......... 22,185,000
750,000 Compaq Computer Corporation .. 21,937,500
255,000 EMC Corporation+ ............. 35,429,062
210,000 Hewlett-Packard Company ...... 28,350,000
200,000 International Business Machines
Corporation ................ 22,325,000
-------------
130,226,562
-------------
OIL & GAS - 6.6%
116,000 BP Amoco Plc, Sponsored ADR .. 5,916,000
312,576 Exxon Mobil Corporation ...... 24,283,248
674,000 Halliburton Company .......... 29,782,375
SHARES VALUE
------ -----
229,900 Royal Dutch Petroleum Company $ 13,190,513
558,300 Tosco Corporation ............ 17,900,494
330,000 Unocal Corporation ........... 10,663,125
------------
101,735,755
------------
UTILITIES/TELECOMMUNICATIONS - 6.2%
535,000 AT&T Corporation ............. 24,977,813
303,800 Comcast Corporation, SpeciaL
Class A .................... 12,170,988
397,500 MCI Worldcom+ ................ 18,061,406
350,000 SBC Communications Inc. ...... 15,334,375
408,800 Sprint Corporation, FON Group+ 25,141,200
-------------
95,685,782
-------------
MEDIA - 5.1%
601,000 AT&T Corporation-Liberty Media
Group, Class A+ ............ 30,012,438
348,600 News Corporation Ltd.,
Sponsored ADR .............. 15,338,400
218,000 Viacom Inc., Class A+ ........ 11,949,125
500,000 Walt Disney Company .......... 21,656,250
-------------
78,956,213
-------------
AEROSPACE/DEFENSE - 4.4%
925,000 Boeing Company ............... 36,710,937
243,000 Honeywell International Inc... 13,608,000
812,000 Raytheon Company, Class B .... 18,016,250
-------------
68,335,187
-------------
CAPITAL GOODS - 3.7%
1,250,000 Tyco International Ltd. ...... 57,421,875
-------------
HEALTH CARE SERVICES - 3.5%
496,000 Aetna Inc. ................... 28,706,000
500,000 PacifiCare Health Systems Inc.+ 25,718,750
-------------
54,424,750
-------------
INSURANCE - 3.4%
600,000 Allstate Corporation ......... 14,175,000
300,000 American International Group Inc. 32,906,250
645,154 Conseco Inc. ................. 3,508,025
88,000 Liberty Financial Companies Inc. 1,650,000
-------------
52,239,275
-------------
FINANCIAL SERVICES - 3.1%
625,000 Freddie Mac .................. 28,710,937
95,000 Merrill Lynch & Company Inc... 9,684,062
100,000 Providian Financial Corporation 8,806,250
-------------
47,201,249
-------------
RETAIL SALES - 3.0%
555,000 Intimate Brands Inc. ......... 21,367,500
246,000 Target Corporation ........... 16,374,375
158,000 Wal-Mart Stores Inc. ......... 8,749,250
-------------
46,491,125
-------------
</TABLE>
See Notes to Financial Statements.
52
<PAGE>
PORTFOLIO OF INVESTMENTS (CONTINUED)
GROWTH & INCOME FUND
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
SHARES VALUE
------ -----
COMMON STOCKS (CONTINUED)
ELECTRONICS/SEMICONDUCTORS - 2.4%
<S> <C> <C> <C>
286,600 Intel Corporation ............ $ 36,344,462
-------------
ELECTRICAL EQUIPMENT - 1.9%
77,525 Emerson Electric Company ..... 4,254,184
157,900 General Electric Company ..... 24,829,775
-------------
29,083,959
-------------
CONSUMER DURABLES - 1.7%
720,000 Federal-Mogul Corporation .... 9,765,000
1,360,000 Mattel Inc. .................. 16,660,000
-------------
26,425,000
-------------
UTILITIES/GAS & ELECTRIC - 1.5%
338,000 Enron Corporation ............ 23,554,375
-------------
COMMUNICATION EQUIPMENT - 1.1%
275,000 Lucent Technologies Inc. ..... 17,101,563
-------------
LODGING & RESTAURANTS - 1.1%
176,200 Sunburst Hospitality Corporation+ 858,975
475,000 Tricon Global Restaurants Inc.+ 16,209,375
-------------
17,068,350
-------------
BASIC INDUSTRY - 0.8%
723,365 Waste Management Inc. ........ 11,483,419
-------------
BUSINESS SERVICES - 0.7%
331,100 Dun & Bradstreet Corporation . 9,974,387
-------------
TRANSPORTATION - 0.4%
136,000 Expeditors International of
Washington Inc. ............ 5,814,000
-------------
Total Common Stocks
(Cost $1,160,869,930) ...... 1,521,203,769
-------------
PRINCIPAL
AMOUNT VALUE
--------- -----
REPURCHASE AGREEMENT - 0.6%
(COST $10,266,000)
$10,266,000 Agreement with Goldman Sachs &
Company, 5.640% dated 04/28/2000,
to be repurchased at $10,270,825 on
05/01/2000, collateralized by
$8,834,845 U.S. Treasury Note,
7.500% due 11/15/2024 (Market
Value $10,515,650) ......... $ 10,266,000
-------------
TOTAL INVESTMENTS (Cost $1,171,135,930*) 99.5% 1,531,469,769
OTHER ASSETS AND LIABILITIES (NET) ... 0.5 7,102,249
----- -------------
NET ASSETS ........................... 100.0% $1,538,572,018
===== ==============
----------------------
<FN>
* Aggregate cost for federal tax purposes.
** Securities on loan at April 30, 2000, which have an aggregate market value of
$17,096,925, represent 1.1% of the total net assets of the Fund (Note 7).
+ Non-income producing security.
</FN>
</TABLE>
------------------------------------------------
GLOSSARY OF TERMS
ADR -- American Depositary Receipt
------------------------------------------------
See Notes to Financial Statements.
53
<PAGE>
PORTFOLIO OF INVESTMENTS
GROWTH FUND OF THE NORTHWEST
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
SHARES VALUE
------ -----
COMMON STOCKS - 94.8%
BANKS/SAVINGS & LOANS - 11.1%
<S> <C> <C>
348,450 Bank of America Corporation ... $17,074,050
443,205 First Savings Bank of Washington
Bancorp Inc. ................ 6,648,075
27,947 Horizon Financial Corporation 255,016
104,850 Interwest Bancorp Inc. ........ 1,677,600
409,700 KeyCorp ....................... 7,579,450
122,100 Sterling Financial Corporation + 1,297,312
583,668 U.S. Bancorp .................. 11,855,756
768,326 Washington Federal Inc. ....... 13,397,685
279,300 Wells Fargo & Company ......... 11,468,756
-------------
71,253,700
-------------
HEALTH CARE PRODUCTS - 9.8%
535,400 Corixa Corporation+ ........... 16,463,550
511,700 Epitope Inc.+ ................. 4,477,375
267,670 ICOS Corporation+ ............. 10,773,718
115,890 Immunex Corporation+ .......... 4,563,169
511,200 NeoRx Corporation+ ............ 7,540,200
574,163 SonoSite Inc.+ ................ 18,911,494
-------------
62,729,506
-------------
ELECTRONICS/SEMICONDUCTORS - 8.0%
72,420 Credence Systems Corporation+ 10,337,955
47,350 Intel Corporation ............. 6,004,572
228,040 Lattice Semiconductor Corporation+ 15,364,195
68,280 Micron Technology Inc.+ ....... 9,507,990
469,800 Semitool, Inc.+ ............... 9,418,022
7,570 TriQuint Semiconductor Inc.+ .. 778,291
-------------
51,411,025
-------------
ELECTRICAL EQUIPMENT - 7.8%
165,730 Electro Scientific Industries
Inc.+ ....................... 10,451,348
994,625 FEI Company+ .................. 22,503,391
491,850 Flir Systems Inc.+ ............ 3,627,394
218,435 Microvision Inc.+,** .......... 7,222,007
113,580 Tektronix Inc. ................ 6,573,443
-------------
50,377,583
-------------
CONSUMER CYCLICALS - 7.1%
1,058,725 Building Materials Holding
Corporation+ ................ 10,587,250
178,900 Columbia Sportswear Company+ .. 5,199,281
942,200 Cutter & Buck Inc.+ ........... 11,483,062
1,310,480 K2 Inc. ....................... 9,337,170
211,710 Nike Inc., Class B ............ 9,196,153
-------------
45,802,916
-------------
COMPUTER SOFTWARE/SERVICES - 7.0%
60,630 Adobe Systems Inc. ............ 7,332,441
696,500 ARIS Corporation+ ............. 5,093,156
69,700 BSQUARE Corporation + ......... 1,219,750
SHARES VALUE
------ -----
171,850 Click2Learn.com Inc.+ ......... $ 1,632,575
70,200 F5 Networks Inc.+ ............. 3,277,462
645,940 Mentor Graphics Corporation+ .. 8,477,962
209,139 Microsoft Corporation+ ........ 14,587,445
149,700 ONYX Software Corporation+ .... 3,190,481
-------------
44,811,272
-------------
COMPUTER SYSTEMS - 6.3%
312,700 Apex Inc.+ .................... 9,244,194
530,930 In Focus Systems Inc.+ ........ 15,894,717
375,442 RadiSys Corporation + ......... 15,533,913
-------------
40,672,824
-------------
BASIC INDUSTRY - 6.0%
124,133 Boise Cascade Corporation ..... 4,042,081
1,024,700 Louisiana-Pacific Corporation . 13,705,362
1,157,430 Oregon Steel Mills Inc. ....... 3,544,629
413,680 Schnitzer Steel Industries Inc.,
Class A ..................... 6,722,300
110,200 Weyerhaeuser Company .......... 5,888,812
121,600 Willamette Industries Inc. .... 4,643,600
-------------
38,546,784
-------------
HEALTH CARE SERVICES - 4.3%
1,663,960 Foundation Health Systems Inc.,
Class A+ .................... 16,743,598
218,500 PacifiCare Health Systems Inc.,
Class B+ .................... 11,239,094
-------------
27,982,692
-------------
TRANSPORTATION - 4.3%
399,050 Airborne Freight Corporation .. 8,554,634
273,810 Alaska Air Group Inc.+ ........ 7,872,038
265,460 Expeditors International of
Washington Inc. ............. 11,348,415
-------------
27,775,087
-------------
CONSUMER STAPLES - 4.0%
328,600 Albertson's Inc. .............. 10,700,038
797,424 Kroger Company+ ............... 14,802,183
-------------
25,502,221
-------------
AEROSPACE/DEFENSE - 3.5%
384,664 Boeing Company ................ 15,266,352
179,825 Precision Castparts Corporation 7,507,694
-------------
22,774,046
-------------
RETAIL SALES - 3.0%
186,540 Costco Wholesale Corporation+ . 10,084,819
923,300 Hollywood Entertainment
Corporation+ ................ 6,463,100
110,200 Nordstrom, Inc. ............... 3,064,938
-------------
19,612,857
-------------
</TABLE>
See Notes to Financial Statements.
54
<PAGE>
PORTFOLIO OF INVESTMENTS (CONTINUED)
GROWTH FUND OF THE NORTHWEST
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
SHARES VALUE
------ -----
COMMON STOCKS (CONTINUED)
<S> <C> <C> <C>
CAPITAL GOODS - 2.5%
991,700 Greenbrier Companies Inc. ..... $ 7,561,712
178,850 PACCAR Inc. ................... 8,506,553
-------------
16,068,265
-------------
MEDIA - 2.3%
838,700 Bowne & Company Inc. .......... 9,645,050
175,900 Getty Images, Inc.+ ........... 5,342,963
-------------
14,988,013
-------------
LODGING & RESTAURANTS - 1.9%
122,540 Starbucks Corporation+ ........ 3,704,920
1,182,085 WestCoast Hospitality Corporation+ 8,570,116
-------------
12,275,036
-------------
CONSUMER DURABLES - 1.9%
728,812 Monaco Coach Corporation+ ..... 11,934,296
-------------
INSURANCE - 1.5%
90,290 SAFECO Corporation ............ 1,997,666
271,615 StanCorp Financial Group Inc. . 7,910,787
-------------
9,908,453
-------------
REAL ESTATE INVESTMENT TRUSTS - 1.3%
244,815 Pacific Gulf Properties Inc. .. 5,263,523
110,680 Shurgard Storage Centers Inc.,
Class A ..................... 2,898,433
-------------
8,161,956
-------------
UTILITIES/TELECOMMUNICATIONS - 1.2%
202,200 General Communication Inc.,
Class A+ .................... 1,011,000
107,650 GST Telecommunications Inc.+ .. 363,319
506,795 Metro One Telecommunications Inc.+ 6,081,540
-------------
7,455,859
-------------
Total Common Stocks
(Cost $401,409,296) ........ 610,044,391
-------------
PRINCIPAL
AMOUNT VALUE
--------- -----
REPURCHASE AGREEMENT - 6.1%
(COST $39,213,000)
$39,213,000 Agreement with Goldman Sachs &
Company, 5.640% dated 04/28/2000,
to be repurchased at $39,231,430
on 05/01/2000, collateralized
by 33,746,421 U.S. Treasury Note,
7.500% due 11/15/2024 (Market Value
of $40,166,585) ............... $ 39,213,000
-------------
TOTAL INVESTMENTS (Cost $440,622,296*) . 100.9% 649,257,391
OTHER ASSETS AND LIABILITIES (NET) ..... (0.9) (5,939,306)
----- -------------
NET ASSETS ............................. 100.0% $643,318,085
===== =============
----------------------
<FN>
* Aggregate cost for federal tax purposes.
** Securities on loan at April 30, 2000, which have an aggregate market value of
$5,438,991, represent 0.8% of the total net assets of the Fund (Note 7).
+ Non-income producing security.
</FN>
</TABLE>
See Notes to Financial Statements.
55
<PAGE>
PORTFOLIO OF INVESTMENTS
GROWTH FUND
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
SHARES VALUE
------ -----
COMMON STOCKS - 88.5%
UTILITIES/TELECOMMUNICATIONS - 30.0%
<S> <C> <C>
2,154,000 China Telecom (Hong Kong), Ltd.+ $ 15,555,192
473,415 Comcast Corporation, Class A ... 18,966,188
207,555 Cox Communications Inc., Class A+ 8,885,948
21,940 E-Tek Dynamics Inc.+ ........... 4,492,215
90,691 Ericsson LM, B Shares .......... 8,062,546
263,585 Ericsson LM, B Shares,
Sponsored ADR+ ............... 23,310,798
243,445 Level 3 Communications Inc.+ ... 21,666,605
70,205 Nextel Communications Inc.,
Class A+,** .................. 7,683,060
2,641,708 Nokia Corporation, Class A,
Sponsored ADR ................ 150,247,143
114,973 NTL Inc.+ ...................... 8,795,439
355 NTT DoCoMo Inc.+ ............... 11,865,654
212,330 QUALCOMM Inc.+ ................. 23,024,534
316,070 Sprint Corporation, PCS Group+ . 17,383,850
525,505 Telefonica S.A. ................ 11,694,992
316,990 Telefonos de Mexico S.A.,
Class L, Sponsored ADR ....... 18,642,974
5,766,259 Vodafone AirTouch Plc .......... 26,438,704
22,885 Vodafone AirTouch Plc,
Sponsored ADR ................ 1,075,595
116,275 VoiceStream Wireless Corporation+ 11,511,225
171,640 Winstar Communications Inc.+ ... 6,844,145
-------------
396,146,807
-------------
COMPUTER SOFTWARE/SERVICES - 19.2%
591,740 Amazon.com Inc.+ ............... 32,656,651
223,555 DoubleClick Inc.+ .............. 16,962,236
83,545 eBay Inc.+ ..................... 13,299,320
333,455 Electronic Arts Inc.+ .......... 20,174,027
125,545 Exodus Communications Inc.+ .... 11,102,886
61,090 GoTo.com Inc.+ ................. 2,084,696
51,225 Healtheon/WebMD Corporation+ ... 1,078,927
285,455 i2 Technologies Inc.+ .......... 36,895,059
108,180 InfoSpace Inc.+ ................ 7,768,676
50,855 Inktomi Corporation+ ........... 7,828,492
17,680 Internet Capital Group Inc.+,** 749,190
123,960 Lycos Inc.+ .................... 5,764,140
229,976 MarchFirst Inc.+ ............... 4,901,363
141,325 Microsoft Corporation+ ......... 9,857,419
67,855 NetZero Inc.+ .................. 818,501
143,085 Phone.com Inc.+ ................ 12,019,140
200,570 Priceline.com Inc.+ ............ 12,686,052
9,995 RealNetworks Inc.+ ............. 476,012
159,940 Software.com Inc.+ ............. 12,935,147
52,500 Ticketmaster Online-CitySearch Inc.,
Class B+ ..................... 1,050,000
157,925 Verio Inc.+ .................... 5,932,058
93,580 VeriSign Inc.+ ................. 13,042,712
96,573 VERITAS Software Corporation+,** 10,358,963
253,560 Vignette Corporation+ .......... 12,218,423
-------------
252,660,090
-------------
SHARES VALUE
------ -----
MEDIA - 12.1%
1,091,132 AT&T Corporation-Liberty
Media Group, Class A+ ........ $ 54,488,404
176,320 Cablevision Systems Corporation,
Class A+ ..................... 11,934,660
455,475 Charter Communications Inc.,
Class A+ ..................... 6,689,789
276,101 Infinity Broadcasting Corporation,
Class A+ ..................... 9,370,178
66,200 Lamar Advertising Company+ ..... 2,916,938
34,670 Liberty Digital Inc., Class A+ . 1,109,440
575,355 Time Warner Inc.** ............. 51,745,990
178,530 TMP Worldwide Inc.+ ............ 11,671,399
173,510 UnitedGlobalCom Inc., Class A+ . 9,217,719
-------------
159,144,517
-------------
COMPUTER SYSTEMS - 6.2%
199,085 3Com Corporation+ .............. 7,851,415
371,790 ASM Lithography Holding NV+ .... 14,871,600
416,568 Cisco Systems Inc.+ ............ 28,879,878
215,260 EMC Corporation+ ............... 29,907,686
-------------
81,510,579
-------------
OIL & GAS - 5.2%
986,180 Enron Corporation** ............ 68,724,419
-------------
ELECTRONICS/SEMICONDUCTORS - 4.6%
173,640 Analog Devices Inc.+ ........... 13,337,723
59,430 JDS Uniphase Corporation+ ...... 6,162,148
83,290 Maxim Integrated Products Inc.+ 5,398,233
62,800 Sony Corporation ............... 7,215,851
62,800 Sony Corporation New + ......... 7,268,182
130,925 Texas Instruments Inc. ......... 21,324,409
-------------
60,706,546
-------------
HEALTH CARE PRODUCTS - 2.8%
544,022 Medtronic Inc. ................. 28,255,143
67,910 MiniMed Inc.+ .................. 8,348,686
-------------
36,603,829
-------------
FINANCIAL SERVICES - 1.8%
91,280 American Express Company ....... 13,697,705
498,230 E*TRADE Group Inc.+ ............ 10,711,945
-------------
24,409,650
-------------
BANKS/SAVINGS & LOANS - 1.8%
239,285 Fifth Third Bancorp ............ 15,104,866
365,519 Firstar Corporation ............ 9,092,285
-------------
24,197,151
-------------
CAPITAL GOODS - 1.7%
219,600 Applied Materials Inc.+ ........ 22,358,025
-------------
</TABLE>
See Notes to Financial Statements.
56
<PAGE>
PORTFOLIO OF INVESTMENTS (CONTINUED)
GROWTH FUND
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
SHARES VALUE
------ -----
COMMON STOCKS (CONTINUED)
TECHNOLOGY - 1.2%
<S> <C> <S>
145,445 iGATE Capital Corporation+ ..... $ 4,363,350
202,745 PE Biosystems Group ............ 12,164,700
-------------
16,528,050
-------------
RETAIL SALES - 1.0%
233,515 Home Depot Inc. ................ 13,091,435
-------------
BUSINESS SERVICES - 0.9%
145,875 Sapient Corporation+ ........... 11,551,477
-------------
Total Common Stocks
(Cost $801,715,440) .......... 1,167,632,575
-------------
PRINCIPAL
AMOUNT
---------
U.S. GOVERNMENT AGENCY DISCOUNT NOTES - 9.4%
FEDERAL HOME LOAN MORTGAGE CORPORATION (FHLMC) - 5.3%
<S> <C> <C> <C>
$30,000,000 5.890% due 05/19/2000++ ........ $ 29,911,650
20,000,000 5.220% due 06/02/2000++ ........ 19,894,756
20,000,000 5.220% due 06/08/2000++ ........ 19,875,867
-------------
Total FHLMCs (Cost $69,682,273) 69,682,273
-------------
FEDERAL NATIONAL MORTGAGE ASSOCIATION (FNMA) - 2.6%
20,000,000 6.000% due 06/22/2000++ ........ 19,827,244
15,000,000 5.990% due 07/18/2000++ ........ 14,799,750
-------------
Total FNMAs (Cost $34,632,569) . 34,626,994
-------------
FEDERAL HOME LOAN BANK (FHLB) - 1.5%
20,000,000 5.950% due 08/01/2000++ ........ 19,680,400
-------------
Total FHLB (Cost $19,705,404) .. 19,680,400
-------------
Total U.S. Government Agency
Discount Notes
(Cost $124,020,246) .......... 123,989,667
-------------
COMMERCIAL PAPER - 1.7%
(COST $21,800,000)
21,800,000 Associates Corporation,
5.990% due 05/01/2000 ........ 21,800,000
-------------
TOTAL INVESTMENTS (Cost $947,535,686*) . 99.6% 1,313,422,242
OTHER ASSETS AND LIABILITIES (NET) ..... 0.4 5,306,403
---- --------------
NET ASSETS ............................. 100.0% $1,318,728,645
===== ==============
----------------------
<FN>
* Aggregate cost for federal tax purposes.
** Securities on loan at April 30, 2000, which have an aggregate market value of
$39,649,643, represent 3.0% of the total net assets of the Fund (Note 7).
+ Non-income producing security.
++ Rate represents annualized yield at date of purchase.
</FN>
</TABLE>
<TABLE>
<CAPTION>
SCHEDULE OF FORWARD FOREIGN CURRENCY CONTRACTS
U. S. FORWARD FOREIGN CURRENCY CONTRACTS TO BUY
CONTRACTS TO RECEIVE
----------------------------------------
NET
IN UNREALIZED
EXPIRATION LOCAL VALUE IN EXCHANGE (DEPRECIATION)
DATE CURRENCY U.S. $ FOR U.S. $ OF CONTRACTS
---------- -------------- ---------- ---------- --------------
<S> <C> <C> <C> <C>
06/09/2000 EMU 52,000,000 47,415,409 50,169,182 $(2,753,773)
09/08/2000 EMU 4,300,000 3,945,656 4,162,062 (216,406)
-----------
$(2,970,179)
-----------
U. S. FORWARD FOREIGN CURRENCY CONTRACTS TO SELL
CONTRACTS TO DELIVER
----------------------------------------
NET
IN UNREALIZED
EXPIRATION LOCAL VALUE IN EXCHANGE APPRECIATION
DATE CURRENCY U.S. $ FOR U.S. $ OF CONTRACTS
---------- -------------- ---------- ---------- --------------
06/09/2000 EMU 65,000,000 59,269,262 67,260,430 $ 7,991,168
09/08/2000 EMU 50,500,000 46,338,515 48,798,445 2,459,930
09/08/2000 JPY 683,000,000 6,480,926 6,696,933 216,007
09/14/2000 JPY 170,000,000 1,614,961 1,626,700 11,739
09/22/2000 EMU 209,800,000 29,083,864 30,519,274 1,435,410
10/05/2000 EMU 5,400,000 4,964,441 5,189,400 224,959
10/05/2000 JPY 390,000,000 3,719,730 3,853,755 134,025
-----------
$12,473,238
-----------
Net Unrealized Appreciation of Forward Foreign
Currency Contracts ................................... $ 9,503,059
===========
-------------------------------------------------
GLOSSARY OF TERMS
ADR -- American Depositary Receipt
EMU -- European Monetary Unit
JPY -- Japanese Yen
-------------------------------------------------
</TABLE>
See Notes to Financial Statements.
57
<PAGE>
PORTFOLIO OF INVESTMENTS
MID CAP STOCK FUND
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
SHARES VALUE
------ -----
COMMON STOCKS - 96.2%
COMPUTER SOFTWARE/SERVICES - 11.6%
<S> <C> <C>
85,000 Acxiom Corporation+ ........... $ 2,295,000
56,000 BMC Software Inc.+ ............ 2,621,500
176,000 PeopleSoft Inc.+ .............. 2,453,000
127,000 Sykes Enterprises Inc.+ ....... 2,540,000
57,000 Synopsys Inc.+ ................ 2,394,000
116,000 Systems & Computer Technology
Corporation+ ................ 2,733,250
-------------
15,036,750
-------------
HEALTH CARE SERVICES - 10.5%
42,000 Aetna Inc. .................... 2,430,750
271,000 Covance Inc.+ ................. 2,489,812
53,000 Express Scripts Inc., Class A+ 1,894,750
281,000 Foundation Health Systems Inc.,
Class A+ .................... 2,827,563
86,000 IMS Health Inc. ............... 1,467,375
47,000 PacifiCare Health Systems Inc.+ 2,417,563
-------------
13,527,813
-------------
HEALTH CARE PRODUCTS - 8.6%
61,000 ALZA Corporation+ ............. 2,687,812
154,000 AmeriSource Health Corporation,
Class A+ .................... 3,080,000
105,000 ICN Pharmaceuticals Inc. ...... 2,644,688
93,000 Mylan Laboratories Inc. ....... 2,638,875
-------------
11,051,375
-------------
BANKS/SAVINGS & LOANS - 8.0%
88,000 Bank United Corporation, Class A 2,920,500
128,000 Charter One Financial Inc. .... 2,600,000
54,000 Comerica Inc. ................. 2,288,250
108,000 TCF Financial Corporation ..... 2,524,500
-------------
10,333,250
-------------
CONSUMER STAPLES - 7.5%
81,000 Avon Products Inc. ............ 3,361,500
35,000 Beringer Wine Estates Holding Inc.,
Class B+ .................... 1,264,375
63,000 Hershey Foods Corporation ..... 2,858,625
56,000 Suiza Foods Corporation+ ...... 2,180,500
-------------
9,665,000
-------------
BASIC INDUSTRY - 6.3%
139,000 Federal Signal Corporation .... 2,823,437
203,000 Republic Services Inc.+ ....... 2,778,562
72,000 Teleflex Inc. ................. 2,488,500
-------------
8,090,499
-------------
SHARES VALUE
------ -----
ELECTRONICS/SEMICONDUCTORS - 5.9%
69,000 Arrow Electronics Inc.+ ....... $ 3,023,062
34,000 Microchip Technology Inc.+ .... 2,110,125
148,000 Sensormatic Electronics
Corporation+ ................ 2,469,750
-------------
7,602,937
-------------
FINANCIAL SERVICES - 5.1%
55,000 A.G. Edwards Inc. ............. 2,069,375
45,000 Ambac Financial Group Inc. .... 2,160,000
27,000 Providian Financial Corporation 2,377,687
-------------
6,607,062
-------------
OIL & GAS - 4.9%
67,000 Baker Hughes Inc. ............. 2,131,438
81,000 Ocean Energy Inc.+ ............ 1,047,938
32,000 Tosco Corporation ............. 1,026,000
65,000 Unocal Corporation ............ 2,100,313
-------------
6,305,689
-------------
UTILITIES/TELECOMMUNICATIONS - 3.9%
103,000 Comsat Corporation ............ 2,517,063
41,000 United States Cellular Corporation+ 2,462,563
-------------
4,979,626
-------------
CONSUMER DURABLES - 3.4%
127,000 Federal-Mogul Corporation ..... 1,722,437
214,000 Mattel Inc. ................... 2,621,500
-------------
4,343,937
-------------
CONSUMER CYCLICALS - 3.3%
53,000 Jones Apparel Group Inc.+ ..... 1,573,437
61,000 Nike Inc., Class B ............ 2,649,687
-------------
4,223,124
-------------
RETAIL SALES - 3.0%
53,000 Intimate Brands Inc. .......... 2,040,500
137,000 Penney (J.C.) Company Inc. .... 1,892,313
-------------
3,932,813
-------------
LODGING & RESTAURANTS - 2.9%
36,000 Papa John's International Inc.+ 990,000
80,000 Tricon Global Restaurants Inc.+ 2,730,000
-------------
3,720,000
-------------
CAPITAL GOODS - 2.1%
56,000 CommScope Inc.+ ............... 2,660,000
-------------
COMPUTER SYSTEMS - 2.0%
50,000 Electronics for Imaging Inc.+ 2,612,500
-------------
</TABLE>
See Notes to Financial Statements.
58
<PAGE>
PORTFOLIO OF INVESTMENTS (CONTINUED)
MID CAP STOCK FUND
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
SHARES VALUE
------ -----
COMMON STOCKS (CONTINUED)
AEROSPACE/DEFENSE - 1.9%
<S> <C> <C>
58,000 Litton Industries Inc.+ ....... $ 2,519,375
-------------
BUSINESS SERVICES - 1.8%
102,000 ACNielsen Corporation+ ........ 2,352,375
-------------
INSURANCE - 1.8%
48,000 The PMI Group Inc. ............ 2,325,000
-------------
MEDIA - 1.7%
54,000 Houghton Mifflin Company ...... 2,244,375
-------------
Total Common Stocks
(Cost $111,555,758) ......... 124,133,500
-------------
PRINCIPAL
AMOUNT VALUE
--------- -----
REPURCHASE AGREEMENT - 6.9%
(COST $8,913,000)
$ 8,913,000 Agreement with Goldman Sachs &
Company, 5.640% dated 04/28/2000,
to be repurchased at $8,917,189 on
05/01/2000, collateralized by
$7,670,463 U.S. Treasury Note,
7.500% due 11/15/2024 (Market
Value $9,129,747) ........... $ 8,913,000
------------
TOTAL INVESTMENTS (Cost $120,468,758*) .. 103.1% 133,046,500
OTHER ASSETS AND LIABILITIES (NET) ...... (3.1) (3,970,626)
----- ------------
NET ASSETS .............................. 100.0% $129,075,874
===== ------------
=====================
<FN>
* Aggregate cost for federal tax purposes.
+ Non-income producing security.
</FN>
</TABLE>
See Notes to Financial Statements.
59
<PAGE>
PORTFOLIO OF INVESTMENTS
SMALL CAP STOCK FUND
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
SHARES VALUE
------ -----
COMMON STOCKS - 97.7%
COMPUTER SOFTWARE/SERVICES - 23.6%
<S> <C> <C>
746,450 ARIS Corporation+ ............. $ 5,458,416
330,900 AVT Corporation+ .............. 3,660,581
233,400 BSQUARE Corporation+ .......... 4,084,500
658,150 Carreker-Antinori Inc.+ ....... 7,239,650
19,000 Check Point Software Technologies
Inc.+ ....................... 3,287,000
575,325 Click2Learn.com Inc.+,** ...... 5,465,587
368,150 Harbinger Corporation+ ........ 6,948,831
40,600 HNC Software Inc.+ ............ 2,009,700
293,000 Intraware Inc.+ ............... 4,688,000
372,550 Made2Manage Systems Inc.+ ..... 2,933,831
153,400 Mission Critical Software Inc.+ 5,522,400
271,400 Onyx Software Corporation+ .... 5,784,212
125,400 Primus Knowledge Solutions Inc.+ 4,663,312
-------------
61,746,020
-------------
HEALTH CARE PRODUCTS - 22.1%
353,500 ChiRex Inc.+ .................. 6,009,500
203,550 Corixa Corporation+ ........... 6,259,163
68,900 CV Therapeutics Inc.+ ......... 2,747,388
212,400 DUSA Pharmaceuticals Inc.+ .... 3,504,600
94,000 Emisphere Technologies Inc.+ .. 3,858,406
101,980 ICOS Corporation+ ............. 4,104,695
99,100 Incyte Pharmaceuticals Inc.+ .. 7,630,700
203,725 NeoRx Corporation+ ............ 3,004,944
95,300 Novoste Corporation+ .......... 3,907,300
116,550 Pharmacyclics Inc.+ ........... 5,288,456
171,500 Shire Pharmaceuticals Group, ADR+ 6,902,875
141,371 SonoSite Inc.+ ................ 4,656,407
-------------
57,874,434
-------------
ELECTRONICS/SEMICONDUCTORS - 6.5%
65,210 ATMI Inc.+ .................... 2,510,585
31,575 Credence Systems Corporation+ . 4,507,331
71,500 Lattice Semiconductor Corporation+ 4,817,313
57,200 NVIDIA Corporation+ ........... 5,097,950
-------------
16,933,179
-------------
BUSINESS SERVICES - 5.9%
143,800 Cognizant Technology Solutions
Corporation+ 6,596,825
558,895 First Consulting Group Inc.+ .. 5,030,055
943,400 ZapMe! Corporation+ ........... 3,655,675
-------------
15,282,555
-------------
ELECTRICAL EQUIPMENT - 5.8%
60,520 Electro Scientific Industries Inc.+ 3,816,542
351,900 FEI Company+ .................. 7,961,738
103,980 Microvision Inc.+** ........... 3,437,839
-------------
15,216,119
-------------
SHARES VALUE
------ -----
MEDIA - 5.6%
434,400 Bowne & Company Inc. .......... $ 4,995,600
180,600 Getty Images Inc.+ ............ 5,485,725
107,600 Sirius Satellite Radio Inc.+ .. 4,270,375
-------------
14,751,700
-------------
COMPUTER SYSTEMS - 4.9%
152,100 Apex Inc.+ .................... 4,496,456
73,700 In Focus Systems Inc.+ ........ 2,206,394
146,112 RadiSys Corporation+ .......... 6,045,384
-------------
12,748,234
-------------
UTILITIES/TELECOMMUNICATIONS - 4.8%
83,300 Gilat Satellite Networks Ltd.+ 7,153,388
16,498 GrandeTel Technologies Inc.
Class A+ .................... 2,805
379,700 Latitude Communications Inc.+ 5,505,650
-------------
12,661,843
-------------
FINANCIAL SERVICES - 4.8%
317,017 American Captial Strategies Ltd. 7,687,662
252,491 Heller Financial Inc. ......... 4,907,794
-------------
12,595,456
-------------
CONSUMER CYCLICALS - 4.6%
251,800 Building Materials Holding
Corporation+ ................ 2,518,000
289,350 Cutter & Buck Inc.+,** ........ 3,526,453
855,700 J. Jill Group Inc.+ ........... 3,957,612
294,355 K2 Inc. ....................... 2,097,279
-------------
12,099,344
-------------
TRANSPORTATION - 2.8%
98,600 Airborne Freight Corporation .. 2,113,738
119,800 Expeditors International of
Washington Inc. ............. 5,121,450
-------------
7,235,188
-------------
OIL & GAS - 2.4%
109,431 Hanover Compressor Company+ ... 6,374,356
-------------
BEVERAGE - 1.8%
131,400 Beringer Wine Estates Holdings Inc.,
Class B+ .................... 4,746,825
-------------
LODGING & RESTAURANTS - 0.9%
305,540 WestCoast Hospitality Corporation+ 2,215,165
-------------
CONSUMER DURABLES - 0.9%
150,575 Monaco Coach Corporation+ ..... 2,465,666
-------------
BASIC INDUSTRY - 0.3%
40,200 Schnitzer Steel Industries Inc.,
Class A ..................... 653,250
-------------
Total Common Stocks
(Cost $220,628,994) ......... 255,599,334
-------------
</TABLE>
See Notes to Financial Statements.
60
<PAGE>
PORTFOLIO OF INVESTMENTS (CONTINUED)
SMALL CAP STOCK FUND
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
SHARES VALUE
------ -----
WARRANT - 0.0%#
(COST $0)
<S> <C> <C> <C>
2,030 Per-Se Technologies Inc.,
Expires 07/08/2003+ ......... $ 0
------------
PRINCIPAL
AMOUNT
---------
REPURCHASE AGREEMENT - 2.3%
(COST $6,018,000)
$ 6,018,000 Agreement with Goldman Sachs &
Company, 5.640% dated 04/28/2000,
to be repurchased at $6,020,828
on 05/01/2000, collateralized by
$5,179,047 U.S. Treasury Note,
7.500% due 11/15/2024 (Market
Value of $6,164,346) 6,018,000
------------
TOTAL INVESTMENTS (Cost $226,646,994*) 100.0% 261,617,334
OTHER ASSETS AND LIABILITIES (NET) ... 0.0 41,051
----- ------------
NET ASSETS ........................... 100.0% $261,658,385
===== ============
===========================
<FN>
* Aggregate cost for federal tax purposes.
** Securities on loan at April 30, 2000, which have an aggregate market value of
$1,332,700, represent 0.5% of the total net assets of the Fund (Note 7).
+ Non-income producing security.
# Amount represents less than 0.1% of net assets.
</FN>
--------------------------------------------------------------
GLOSSARY OF TERMS
ADR -- American Depositary Receipt
--------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
61
<PAGE>
PORTFOLIO OF INVESTMENTS
INTERNATIONAL GROWTH FUND
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
SHARES VALUE
------ -----
COMMON STOCKS - 97.8%
JAPAN - 28.0%
<S> <C> <C>
12,010 Advantest Corporation ........ $ 2,747,716
2,150 Aiful Corporation ............ 216,981
38,000 Chugai Pharmaceutical Company Ltd. 731,818
77 DDI Corporation .............. 884,033
12,000 Fanuc Ltd. ................... 1,257,720
5,000 Fuji Soft ABC Inc. ........... 296,283
3,000 Fujitsu Support and Service Inc. 444,424
148,000 Hitachi Ltd. ................. 1,767,696
49,000 Jusco Company Ltd. ........... 907,365
25,000 Kao Corporation .............. 761,539
2,310 Keyence Corporation .......... 766,756
223,000 Mitsubishi Heavy Industries Ltd. 693,746
210,000 Mitsubishi Motors Corporation 740,799
110,000 Mitsui Chemicals Inc. ........ 876,904
160,000 Mitsui Marine and Fire Insurance
Company Ltd. ............... 703,671
17,000 Murata Manufacturing Company Ltd. 3,305,403
166,000 NEC Corporation .............. 4,518,680
3,000 Nichicon Corporation ......... 80,552
89,000 Nikon Corporation ............ 3,131,337
9,200 Nintendo Company Ltd. ........ 1,533,262
74 Nippon Telegraph & Telephone
Corporation ................ 918,106
225,000 Nissan Motor Company Ltd.+ ... 1,022,869
62,000 Nomura Securities Company Ltd. 1,561,409
161 NTT Mobile Communications
Network Inc. ............... 5,381,325
5,800 Rohm Company Ltd. ............ 1,943,984
99,000 Sakura Bank Ltd. ............. 694,801
31,000 Sankyo Company Ltd. .......... 683,117
53,000 Sekisui House Ltd. ........... 485,811
11,000 Shin-Etsu Chemical Company Ltd. 581,547
37,000 Shionogi & Company Ltd. ...... 572,103
28,545 Sony Corporation ............. 3,279,880
28,545 Sony Corporation New+ ........ 3,303,666
59,000 Suzuki Motor Corporation ..... 878,950
19,000 Taiyo Yuden Company Ltd.** ... 1,345,771
1,000 Takeda Chemical Industries Ltd. 65,830
39,000 Tokyo Electron Ltd. .......... 6,358,872
125,000 Toray Industries Inc. ........ 453,683
122,000 Toshiba Corporation .......... 1,183,797
9,000 Ushio Inc. ................... 210,407
-------------
57,292,613
-------------
UNITED KINGDOM - 15.9%
11,800 AstraZeneca Group Plc ........ 492,928
3,300 AstraZeneca Group Plc, ADR ... 139,013
90,956 BG Plc ....................... 549,444
124,100 British Aerospace Plc ........ 761,253
61,800 British Airways Plc .......... 320,160
SHARES VALUE
------ -----
34,800 Cable & Wireless Plc ......... $ 575,935
220,000 Cadbury Schweppes Plc ........ 1,503,654
260,000 Coca-Cola Beverages Plc+ ..... 473,609
7,100 COLT Telecom Group Plc+ ...... 301,663
612,000 Corus Group Plc .............. 819,428
201,300 Enterprise Oil Plc ........... 1,491,803
63,000 GKN Plc ...................... 870,992
58,000 Halifax Group Plc ............ 540,898
445,000 Invensys Plc ................. 2,130,423
60,600 Laporte Plc .................. 502,404
219,751 Lloyds TSB Group Plc ......... 2,148,579
117,143 New Dixons Group Plc ......... 477,835
73,000 Reuters Group Plc ............ 1,305,881
70,200 Royal Bank of Scotland Group Plc 1,089,119
155,000 Shell Transport & Trading Company
Plc ........................ 1,260,894
110,800 Tate & Lyle Plc .............. 391,585
194,000 TI Group Plc ................. 1,055,625
2,039,597 Vodafone AirTouch Plc ........ 9,351,696
94,800 Zeneca Group ................. 3,968,806
-------------
32,523,627
-------------
NETHERLANDS - 8.2%
75,669 ABN-Amro Holding NV .......... 1,558,109
36,719 Aegon NV ..................... 2,638,787
27,000 ASM Lithography Holding NV+ .. 1,055,465
66,000 ASM Lithography Holding NV (F)+ 2,640,000
35,823 DSM NV ....................... 1,176,634
12,000 Heineken Holding NV, Class A 404,186
31,700 Heineken NV .................. 1,757,927
13,700 ING Groep NV+ ................ 747,529
20,000 Koninklijke Luchtvaart Maatschappij
NV (KLM) ................... 336,367
19,000 STMicroelectronics NV ........ 3,604,062
12,000 Unilever NV .................. 545,024
9,300 United Pan-Europe Communications
NV+ ........................ 338,439
-------------
16,802,529
-------------
GERMANY - 7.7%
1,700 Aixtron AG ................... 434,277
1,200 Allianz AG ................... 462,005
44,200 Bayerische Motoren Werke (BMW) AG** 1,175,330
13,000 DaimlerChrysler AG** ......... 756,371
10,900 Degussa-Huels AG+,** ......... 315,608
10,000 Deutsche Bank AG ............. 671,825
19,500 Deutsche Telekom AG** ........ 1,249,785
8,400 Epcos AG+ .................... 1,187,466
18,200 Infineon Technologies, ADR+ .. 1,235,325
41,300 Infineon Technologies AG+ .... 2,844,097
1,100 Intershop Communications AG+ . 488,505
25,300 Siemens AG ................... 3,732,937
11,400 T-Online International AG+ ... 424,913
30,000 Thyssen Krupp AG+,** ......... 627,279
-------------
15,605,723
-------------
</TABLE>
See Notes to Financial Statements.
62
<PAGE>
PORTFOLIO OF INVESTMENTS (CONTINUED)
INTERNATIONAL GROWTH FUND
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
SHARES VALUE
------ -----
COMMON STOCKS (CONTINUED)
FRANCE - 4.4%
<S> <C> <C>
3,520 Bouygues SA+ .................. $ 2,246,422
2,800 Christian Dior SA ............. 665,643
8,000 Compagnie de Saint Gobain ..... 1,091,647
4,900 Groupe Danone ................. 1,071,329
500 LVMH (Louis Vitton Moet Hennessy) 209,820
3,800 PSA Peugeot Citroen ........... 786,262
41,000 Sanofi-Synthelabo SA+ ......... 1,530,061
20,000 Societe BIC SA ................ 796,372
6,200 Vivendi ....................... 613,242
-------------
9,010,798
-------------
SWITZERLAND - 4.2%
698 Adecco SA ..................... 572,330
630 Compagnie Financiere
Richemont AG, Units ......... 1,529,640
1,310 Holderbank Financiere Glarus AG 1,480,269
505 Nestle SA ..................... 889,610
1,220 Novartis AG ................... 1,703,065
50 Roche Holding AG .............. 521,817
181 Schweizerische Rueckversicherungs-
Gesellschaft ................ 290,636
2,269 Swisscom AG .................. 799,416
3,250 UBS AG ........................ 795,692
-------------
8,582,475
-------------
FINLAND - 3.9%
112,400 Nokia Oyj ..................... 6,447,737
62,000 UPM-Kymmene Oyj ............... 1,606,380
-------------
8,054,117
-------------
CANADA - 3.6%
27,000 Bank of Nova Scotia ........... 615,086
70,000 Bombardier Inc., Class B ...... 1,880,526
40,000 Clarica Life Insurance Company+ 785,690
34,000 Inco Ltd.+ .................... 533,581
6,200 Nortel Networks Corporation ... 700,560
23,500 Rogers Communications Inc.+ ... 611,492
2,400 Teleglobe Inc. ................ 59,939
16,000 Teleglobe Inc. (F) ............ 397,000
53,000 Thomson Corporation ........... 1,749,376
2,000 Toronto Dominion Bank Ontario . 46,237
-------------
7,379,487
-------------
AUSTRALIA - 3.0%
165,000 Australia & New Zealand Banking
Group Ltd. .................. 1,140,902
156,920 Broken Hill Proprietary Company
Ltd. ........................ 1,689,865
141,001 Coles Myer Ltd. ............... 527,993
260,000 Foster's Brewing Group Ltd. ... 656,860
82,274 Lend Lease Corporation Ltd. ... 891,579
SHARES VALUE
------ -----
208,700 Santos Ltd. ................... $ 475,335
123,725 Westpac Banking Corporation Ltd. 789,751
-------------
6,172,285
-------------
TAIWAN - 2.9%
73,800 Asustek Computer Inc., GDR .... 974,160
23,600 Hon Hai Precision Industry Company
Ltd., GDR+++ ................ 660,800
81,635 Taiwan Semiconductor Manufacturing
Company Ltd., Sponsored ADR+ 4,270,531
-------------
5,905,491
-------------
SOUTH KOREA - 2.5%
55,600 Hyundai Motor Company Ltd., GDR + 280,780
30,000 Pohang Iron & Steel Company Ltd.,
Sponsored ADR ............... 630,000
7,546 Samsung Electronics ........... 2,039,919
10,500 Samsung Electronics, Sponsored GDR 1,692,337
42,000 Shinhan Bank .................. 403,064
-------------
5,046,100
-------------
HONG KONG - 2.2%
1,350,000 Amoy Properties Ltd. .......... 953,243
260,000 Cable & Wireless HKT Ltd. ..... 612,515
122,000 Hutchison Whampoa Ltd. ........ 1,777,718
100,500 Johnson Electric Holdings Ltd. 809,631
355,000 Legend Holdings Ltd. .......... 412,462
-------------
4,565,569
-------------
SINGAPORE - 2.1%
23,000 Creative Technology Ltd. ...... 596,007
83,000 DBS Group Holdings Ltd. ....... 1,142,983
64,000 Singapore Press Holdings Ltd. . 1,252,622
853,000 Singapore Technologies Engineering
Ltd. ........................ 1,199,648
-------------
4,191,260
-------------
SWEDEN - 2.0%
10,500 Ericsson LM, B Shares ......... 933,463
14,500 Ericsson LM, Sponsored ADR .... 1,282,344
68,700 ForeningsSparbanken AB ........ 1,011,534
70,000 Svenska Handlesbanken AB, A Shares 925,265
-------------
4,152,606
-------------
SPAIN - 1.8%
58,900 Banco Bilbao Vizcaya Argentaria SA+ 803,190
125,460 Telefonica SA+ ................ 2,792,084
-------------
3,595,274
-------------
ITALY - 1.6%
42,000 Assicurazioni Generali ........ 1,195,103
265,000 ENI Spa ....................... 1,317,786
10,000 Fiat Spa+ ..................... 245,184
145,000 UniCredito Italiano Spa** ..... 587,915
-------------
3,345,988
-------------
</TABLE>
See Notes to Financial Statements.
63
<PAGE>
PORTFOLIO OF INVESTMENTS (CONTINUED)
INTERNATIONAL GROWTH FUND
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
SHARES VALUE
------ -----
COMMON STOCKS (CONTINUED)
MEXICO - 1.4%
<S> <C> <C> <C>
50,000 Telefonos de Mexico SA,
Sponsored ADR ............... $ 2,940,625
-------------
PORTUGAL - 0.9%
51,100 Portugal Telecom, SA .......... 570,003
4,000 PT Multimedia Servicos
de Telecomunicacoes e Multimedia
SGPS SA+ .................... 279,094
60,000 Telecel-Comunicacaoes Pessoais, SA 949,100
-------------
1,798,197
-------------
IRELAND - 0.6%
45,000 Allied Irish Banks Plc ........ 448,982
44,000 CRH Plc ....................... 704,007
-------------
1,152,989
-------------
NORWAY - 0.5%
25,000 Norsk Hydro ASA ............... 914,447
-------------
SOUTH AFRICA - 0.3%
88,000 South African Breweries Ltd. .. 648,920
-------------
BRAZIL - 0.1%
5,900 Telecomunicacoes de Sao Paulo SA,
Sponsored ADR ............... 148,975
-------------
Total Common Stocks
(Cost $154,490,158) ......... 199,830,095
-------------
PREFERRED STOCKS - 0.1%
ITALY - 0.1%
20,230 Fiat Spa ...................... 296,097
-------------
UNITED KINGDOM - 0.0%#
969,600 Laporte Plc, Class B .......... 11,322
-------------
Total Preferred Stocks
(Cost $361,120) ............. 307,419
-------------
CONVERTIBLE PREFERRED STOCK - 0.4%
(COST $845,852)
JAPAN - 0.4%
93,000,000 Sanwa International Finance
Bermuda Trust, Conv. Pfd.,
1.250% due 08/01/2005 (F) ... 880,445
-------------
PRINCIPAL
AMOUNT VALUE
--------- -----
CORPORATE BOND - 0.0%#
(COST $281)
UNITED KINGDOM - 0.0%#
$ 173 BG Transco Holdings Plc, Bond,
7.057% due 12/14/2009++ ..... 272
-------------
REPURCHASE AGREEMENT - 1.2%
(COST $2,431,000)
$ 2,431,000 Agreement with Goldman Sachs &
Company, 5.640% dated 04/28/2000,
to be repurchased at $2,432,143
on 05/01/2000, collateralized by
$2,092,101 U.S. Treasury Note,
7.500% due 11/15/2024 (Market
Value of $2,490,117) ........ $ 2,431,000
------------
TOTAL INVESTMENTS (Cost $158,128,411*) .... 99.5% 203,449,231
OTHER ASSETS AND LIABILITIES (NET) ........ 0.5 958,521
----- ------------
NET ASSETS ................................100.0% $204,407,752
====== ============
AS OF APRIL 30, 2000, SECTOR DIVERSIFICATION WAS AS FOLLOWS:
% OF
SECTOR DIVERSIFICATION NET ASSETS VALUE
---------------------- ---------- -----
<S> <C> <C>
COMMON STOCKS:
Telecommunications ................. 23.2% $ 47,505,968
Technology ......................... 22.1 45,151,017
Financial Services ................. 14.1 28,794,842
Material & Processing .............. 9.8 20,110,738
Retail ............................. 5.6 11,503,049
Health Care ........................ 5.5 11,298,168
Consumer Staples ................... 4.7 9,544,827
Energy ............................. 3.0 6,034,213
Producer Durables .................. 2.8 5,824,426
Autos & Transportation ............. 2.7 5,512,246
Other .............................. 4.2 8,550,601
----- -------------
TOTAL COMMON STOCKS ................ 97.8 199,830,095
PREFERRED STOCKS ................... 0.1 307,419
CONVERTIBLE PREFERRED STOCK ........ 0.4 880,445
CORPORATE BOND ..................... 0.0# 272
REPURCHASE AGREEMENT ............... 1.2 2,431,000
----- -------------
TOTAL INVESTMENTS .................. 99.5 203,449,231
OTHER ASSETS AND LIABILITIES (NET) . 0.5 958,521
------ -------------
NET ASSETS ......................... 100.0% $ 204,407,752
===== =============
----------------------
<FN>
* Aggregate cost for federal tax purposes.
** Securities on loan at April 30, 2000, which have an aggregate market value
of $6,755,963, represent 3.3% of the total net assets of the Fund (Note 7).
# Amount represents less than 0.1% of net assets.
+ Non-income producing security.
++ Variable rate security. The rate shown reflects the rate currently in
effect.
+++ Security exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers.
</FN>
</TABLE>
See Notes to Financial Statements.
64
<PAGE>
PORTFOLIO OF INVESTMENTS (CONTINUED)
INTERNATIONAL GROWTH FUND
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
SCHEDULE OF FORWARD FOREIGN CURRENCY CONTRACTS
U. S. FORWARD FOREIGN CURRENCY CONTRACTS TO BUY
CONTRACTS TO RECEIVE
---------------------------------------
NET
UNREALIZED
IN APPRECIATION/
EXPIRATION LOCAL VALUE IN EXCHANGE (DEPRECIATION)
DATE CURRENCY U.S. $ FOR U.S. $ OF CONTRACTS
---------- --------------- --------- ---------- -------------
<S> <C> <C> <C> <C>
05/04/2000 EMU 127,230 115,701 124,798 $ (9,097)
05/08/2000 JPY 2,220,773 20,593 20,560 33
05/26/2000 EMU 1,190,629 1,084,601 1,195,126 (110,525)
06/07/2000 EMU 152,913 139,412 147,492 (8,080)
07/19/2000 EMU 4,070,856 3,722,051 3,927,092 (205,041)
07/31/2000 EMU 568,129 519,879 528,971 (9,092)
08/28/2000 EMU 937,542 859,616 914,339 (54,723)
09/05/2000 EMU 209,145 191,870 205,812 (13,942)
02/20/2001 EMU 2,164,049 2,008,671 2,049,569 (40,898)
----------
$(451,365)
----------
U. S. FORWARD FOREIGN CURRENCY CONTRACTS TO SELL
CONTRACTS TO DELIVER
------------------------------------------
NET
UNREALIZED
IN APPRECIATION/
EXPIRATION LOCAL VALUE IN EXCHANGE (DEPRECIATION)
DATE CURRENCY U.S. $ FOR U.S.$ OF CONTRACTS
---------- --------------- ---------- ---------- ---------------
05/01/2000 JPY 9,433,774 87,362 88,722 $ 1,360
05/02/2000 GBP 243,434 37,901 38,485 584
05/02/2000 AUD 45,167 26,378 26,585 207
05/02/2000 JPY 4,926,028 45,627 46,295 668
05/03/2000 AUD 41,580 24,283 24,287 4
05/04/2000 GBP 77,712 120,993 124,798 3,805
05/05/2000 GBP 71,263 110,952 112,039 1,087
05/08/2000 GBP 171,211 266,570 265,636 (934)
05/26/2000 JPY 124,980,300 1,162,918 1,195,126 32,208
05/31/2000 EMU 181,817 165,685 166,343 658
06/07/2000 CAD 214,674 145,047 147,492 2,445
07/19/2000 AUD 1,558,650 910,981 1,035,489 124,508
07/19/2000 JPY 129,963,660 1,221,320 1,247,551 26,231
07/31/2000 GBP 334,855 521,898 528,971 7,073
08/28/2000 JPY 212,603,970 2,013,148 1,949,339 (63,809)
09/05/2000 GBP 129,837 202,685 205,811 3,126
02/20/2001 JPY 224,130,580 2,194,660 2,049,569 (145,091)
---------
$ (5,870)
---------
Net Unrealized Depreciation of Forward Foreign
Currency Contracts $(457,235)
=========
</TABLE>
---------------------------------------------------
GLOSSARY OF TERMS
ADR -- American Depositary Receipt
AUD -- Australian Dollar
CAD -- Canadian Dollar
EMU -- European Monetary Unit
GBP -- Great Britain Pound Sterling
GDR -- Global Depositary Receipt
JPY -- Japanese Yen
---------------------------------------------------
See Notes to Financial Statements.
65
<PAGE>
PORTFOLIO OF INVESTMENTS
SHORT TERM INCOME FUND
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
--------- -----
CORPORATE BONDS AND NOTES - 51.5%
FINANCIAL - 12.9%
<S> <C> <C>
$ 1,000,000 Bear Stearns Company, Inc., Note,
6.200% due 03/30/2003 ......... $ 958,075
1,000,000 CIT Group Inc., Sr. Note,
6.375% due 11/15/2002 ......... 967,559
1,500,000 Citigroup, Inc., Note,
6.125% due 06/15/2000 ......... 1,499,205
1,000,000 Donaldson, Lufkin & Jenrette
Acceptance Corporation, MTN,
6.375% due 05/26/2000 ......... 1,000,051
General Motors Acceptance
Corporation, Note:
200,000 5.625% due 02/15/2001 ......... 197,610
300,000 6.875% due 07/15/2001 ......... 298,362
255,000 Golden West Financial
Corporation, Deb.,
10.250% due 12/01/2000 ........ 259,383
3,000,000 Goldman Sachs Group L.P, Note,
7.800% due 07/15/2002++ ....... 2,999,463
1,000,000 Lehman Brothers Inc., Sr. Sub. Note,
6.125% due 02/01/2001 ......... 989,356
450,000 MBNA America Bank, NA, Note,
6.100% due 12/15/2000 ......... 446,626
1,500,000 McDonnell Douglas Corporation,
Sub. Note,
6.710% due 07/19/2000 ......... 1,499,389
1,500,000 Merrill Lynch & Company, Series B,
Note,
8.300% due 11/01/2002 ......... 1,531,257
717,000 Paine Webber Group Inc., Deb.,
9.250% due 12/15/2001 ......... 731,057
1,000,000 Potomac Capital Investment
Corporation, Note,
6.800% due 09/12/2001++ ....... 989,247
1,000,000 Salomon Smith Barney Holdings, Note,
6.125% due 01/15/2003 ......... 962,600
500,000 U S West Capital Funding, Inc.,
Company Guarantee,
6.125% due 07/15/2002 ......... 485,664
-------------
15,814,904
-------------
BANKS - 9.6%
470,000 Bankers Trust Corporation,
Sub. Deb.,
9.500% due 06/14/2000 ......... 471,251
1,500,000 Chase Manhattan Corporation, Note,
5.500% due 02/15/2001 ......... 1,481,475
2,000,000 First Chicago Corporation, Sub. Note,
9.250% due 11/15/2001 ......... 2,051,396
1,000,000 Northern Trust Company, Sub. Note,
6.500% due 05/01/2003 ......... 970,604
3,000,000 Wachovia Corporation,
Sr. Unsub. Note,
6.700% due 06/21/2004 ......... 2,917,563
4,000,000 Wells Fargo Company, Note,
6.500% due 09/03/2002 ......... 3,917,864
-------------
11,810,153
-------------
RETAIL SALES - 7.0%
1,000,000 Dillards, Inc., Note,
6.430% due 08/01/2004 ........ 881,653
500,000 Federated Department Stores, Inc.,
Bond,
6.790% due 07/15/2027 ........ 477,465
PRINCIPAL
AMOUNT VALUE
--------- -----
Wal-Mart Stores, Inc.:
Note:
$ 100,000 6.750% due 05/15/2002 ........ $ 98,993
1,250,000 5.850% due 06/01/2000 ........ 1,248,798
6,000,000 Sr. Note,
6.150% due 08/10/2001 ........ 5,933,994
-------------
8,640,903
-------------
UTILITIES - 3.4%
300,000 National Rural Utilities Cooperative
Finance Corporation, Collateral
Trust,
6.750% due 09/01/2001 ........ 298,130
1,000,000 Philadelphia Electric Company,
First Mortgage,
8.000% due 04/01/2002 ........ 1,005,038
1,000,000 United Illuminating Company, Note,
6.000% due 12/15/2003 ........ 928,430
2,000,000 Wisconsin Electric Power Company,
Deb.,
6.625% due 12/01/2002 ........ 1,960,900
-------------
4,192,498
-------------
OIL & GAS - 3.3%
710,000 Enron Corporation, Deb.,
9.125% due 04/01/2003 ........ 728,677
2,500,000 Occidental Petroleum Company,
Sr. Note,
6.400% due 04/01/2003 ........ 2,379,368
1,000,000 Union Texas Petroleum Holdings, Inc.,
Series A, MTN,
6.600% due 12/04/2002 ........ 979,248
-------------
4,087,293
-------------
FOREIGN (U.S. DOLLAR DENOMINATED) - 3.1%
750,000 Eaton Off Shore Ltd., Company
Guarantee,
9.000% due 02/15/2001 ........ 760,375
1,000,000 Fairfax Financial Holdings Ltd., Note,
7.750% due 12/15/2003 ........ 938,574
1,200,000 PDVSA Finance Ltd., Bond,
6.450% due 02/15/2004 ........ 1,086,929
1,000,000 Sony Corporation, Unsub. Note,
6.125% due 03/04/2003 ........ 968,575
-------------
3,754,453
-------------
TRANSPORTATION - 2.8%
1,220,000 CSX Corporation, Deb.,
9.500% due 08/01/2000 ........ 1,224,886
1,000,000 Norfolk Southern Corporation, Note,
6.950% due 05/01/2002 ........ 982,412
150,000 Southwest Airlines Company, Deb.,
9.400% due 07/01/2001 ........ 153,079
1,000,000 Union Pacific Corporation, Deb.,
9.625% due 12/15/2002 ........ 1,038,396
-------------
3,398,773
-------------
INDUSTRIAL - 2.4%
1,000,000 Praxair, Inc., Note,
6.150% due 04/15/2003 ........ 956,057
2,000,000 Sun Microsystems, Inc., Sr. Note,
7.000% due 08/15/2002 ........ 1,963,296
-------------
2,919,353
-------------
</TABLE>
See Notes to Financial Statements.
66
<PAGE>
PORTFOLIO OF INVESTMENTS (CONTINUED)
SHORT TERM INCOME FUND
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
--------- -----
CORPORATE BONDS AND NOTES (CONTINUED)
CONSUMER STAPLES - 2.3%
<S> <C> <C>
$ 2,000,000 Philip Morris Companies Inc., Note,
7.500% due 04/01/2004 ........ $ 1,875,178
1,000,000 Tyson Foods, Inc., Note,
6.000% due 01/15/2003 ........ 948,948
-------------
2,824,126
-------------
REAL ESTATE INVESTMENT TRUSTS/PROPERTY - 1.9%
400,000 Colonial Realty LP, Note,
7.500% due 07/15/2001 ........ 395,485
565,000 Dobie Centers Properties, Ltd.,
Note, Taxable,
6.060% due 05/01/2001++ ...... 557,011
1,500,000 Sun Communities Inc., Sr. Note,
7.625% due 05/01/2003 ........ 1,456,200
-------------
2,408,696
-------------
RENTAL AUTO/EQUIPMENT - 1.4%
1,000,000 Hertz Corporation, Sr. Note,
7.375% due 06/15/2001 ........ 997,130
750,000 Penske Truck Leasing Company, MTN,
Company Guarantee,
6.650% due 11/01/2000 ........ 748,370
-------------
1,745,500
-------------
CAPITAL GOODS - 0.8%
1,000,000 Ingersoll-Rand Company, Sr. Note,
6.255% due 02/15/2001 ........ 991,767
-------------
MEDIA - 0.6%
600,000 Continental Cablevision, Inc.,
Sr. Note,
8.500% due 09/15/2001 ........ 606,769
Cox Communications, Inc., Note:
40,000 8.550% due 06/01/2000 ........ 40,029
100,000 6.375% due 06/15/2000 ........ 99,904
-------------
746,702
-------------
Total Corporate Bonds and Notes
(Cost $65,149,714) ........... 63,335,121
-------------
ASSET-BACKED SECURITIES - 25.1%
6,416,000 California Infrastructure PG&E-1,
1997-1 A6,
6.320% due 09/25/2005 ........ 6,237,667
232,669 Conti-Mortgage Home Equity Loan
Trust, 1996-4 A6,
6.710% due 06/15/2014 ........ 232,105
3,900,000 Dayton Hudson Credit Card Master
Trust, Series 1997-1 A,
6.250% due 08/25/2005 ........ 3,803,261
FFCA Secured Lending Corporation:
4,687,633 1999-1A A1A,
6.370% due 10/18/2008++ ...... 4,405,508
3,824,765 1999-2 WA1A,
7.130% due 02/18/2008++ ...... 3,724,963
4,680,000 First USA Credit Card Master Trust,
1997-6 A,
6.420% due 03/17/2005 ........ 4,599,949
PRINCIPAL
AMOUNT VALUE
--------- -----
$ 249,532 Green Tree Financial Corporation,
1995-6 B1,
7.700% due 09/15/2026 ........ $ 246,998
129,432 Green Tree Home Equity Loan Trust,
1997-B A5,
7.150% due 04/15/2027 ........ 129,596
600,000 MBNA Master Credit Card Trust,
1995-E A,
6.350% due 01/15/2005+ ....... 601,701
6,000,000 Providian Master Trust, 1997-4 A,
6.250% due 06/15/2007 ........ 5,857,650
1,000,000 Standard Credit Card Master Trust,
1994-4 A,
8.250% due 11/07/2003 ........ 1,013,825
-------------
Total Asset-Backed Securities
(Cost $31,758,901) ........... 30,853,223
-------------
U.S. GOVERNMENT AGENCY MORTGAGE-BACKED
SECURITIES - 8.3%
FEDERAL NATIONAL MORTGAGE ASSOCIATION (FNMA) - 5.5%
72,155 #250235, 7 Year Balloon,
8.500% due 02/01/2002 ........ 72,523
2,609,485 #252214,
6.500% due 01/01/2014 ........ 2,499,226
163,607 #313030,
10.000% due 05/01/2022 ....... 174,600
3,931,695 #313293,
6.500% due 01/01/2012 ........ 3,765,570
305,392 #313641,
8.500% due 11/01/2017 ........ 310,373
-------------
Total FNMAs (Cost $7,181,380) .. 6,822,292
-------------
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION (GNMA) - 1.2%
97,286 #1991,
9.000% due 04/20/2025 ........ 99,451
96,004 #38720,
11.000% due 02/15/2010 ....... 105,814
50,552 #130183,
11.000% due 05/15/2015 ....... 55,718
134,207 #131917,
11.000% due 10/15/2015 ....... 147,922
44,513 #139704,
11.000% due 11/15/2015 ....... 49,061
126,708 #140835,
11.000% due 11/15/2015 ....... 139,656
57,270 #153965,
10.000% due 02/15/2019 ....... 61,296
36,645 #189482,
11.000% due 04/15/2020 ....... 40,389
544,455 #262996,
10.000% due 01/15/2019 ....... 582,736
93,134 #291375,
11.000% due 08/15/2020 ....... 102,651
50,330 #377550,
8.000% due 03/15/2012 ........ 51,101
-------------
Total GNMAs (Cost $1,452,416) 1,435,795
-------------
</TABLE>
See Notes to Financial Statements.
67
<PAGE>
PORTFOLIO OF INVESTMENTS (CONTINUED)
SHORT TERM INCOME FUND
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
--------- -----
U.S. GOVERNMENT AGENCY MORTGAGE-BACKED
SECURITIES (CONTINUED)
ADJUSTABLE RATE MORTGAGE-BACKED SECURITIES (ARM) - 0.9%
<S> <C> <C> <C>
$ 255,239 Federal Home Loan Mortgage
Corporation (FHLMC),
#845988,
7.513% due 11/01/2021 ........ $ 263,653
Federal National Mortgage
Association (FNMA):
204,901 #082247,
6.125% due 04/01/2019 ........ 199,776
53,867 #124571,
7.410% due 11/01/2022 ........ 55,756
153,767 #141461,
7.466% due 11/01/2021 ........ 158,963
142,360 #152205,
7.204% due 01/01/2019 ........ 144,253
359,583 #313257,
6.176% due 11/01/2035 ........ 349,565
-------------
Total ARMs (Cost $1,180,507) ... 1,171,966
-------------
FEDERAL HOME LOAN MORTGAGE CORPORATION (FHLMC) - 0.7%
179,482 #A01226,
9.500% due 08/01/2016 ........ 188,636
58,500 #L73756,
5.500% due 05/01/2001 ........ 55,578
39,897 #L73821,
6.000% due 06/01/2001 ........ 38,448
160,504 #L74100,
7.000% due 09/01/2001 ........ 158,798
85,419 #L90217,
5.500% due 06/01/2001 ........ 81,153
160,572 #L90218,
6.000% due 06/01/2001 ........ 154,741
161,306 #M90453,
6.500% due 05/01/2001 ........ 157,545
-------------
Total FHLMCs (Cost $857,609) ... 834,899
-------------
Total U.S. Government Agency
Mortgage-Backed Securities
(Cost $10,671,912) ........... 10,264,952
-------------
COLLATERALIZED MORTGAGE OBLIGATIONS (CMO) - 7.3%
60,757 Countrywide Funding Corporation,
1994-1 A3,
6.250% due 03/25/2024 ........ 57,984
92,275 Countrywide Mortgage Backed Securities,
Inc., 1994-C A5,
6.375% due 03/25/2024 ........ 91,185
Residential Funding Mortgage Security I:
4,614,778 1995-S14 A8,
7.500% due 09/25/2025 ........ 4,592,143
4,385,226 1998-S20 A18,
6.400% due 09/25/2028 ........ 4,178,002
-------------
Total CMOs (Cost $9,086,032) .. 8,919,314
-------------
PRINCIPAL
AMOUNT VALUE
--------- -----
COMMERCIAL MORTGAGE-BACKED SECURITIES (CMBS) - 6.0%
$ 3,868,673 GMAC Commercial Mortgage Securities
Inc., 1999-CTL, Class A++,
7.151% due 01/15/2008 ........ $ 3,790,091
3,636,314 Morgan Stanley Capital I, 1999-CAMI A1,
6.540% due 04/15/2004 ........ 3,545,860
-------------
Total CMBSs (Cost $7,505,660) .. 7,335,951
-------------
FOREIGN GOVERNMENT BOND - 0.8%
(COST $1,000,319)
1,000,000 Ontario, Province of Canada,
6.125% due 06/28/2000** ...... 998,835
-------------
TOTAL INVESTMENTS (Cost $125,172,538*) . 99.0% 121,707,396
OTHER ASSETS AND LIABILITIES (NET) ..... 1.0 1,174,520
----- ------------
NET ASSETS ............................. 100.0% $122,881,916
===== ============
</TABLE>
NUMBER OF UNREALIZED
CONTRACTS VALUE (DEPRECIATION)
--------- ----- -------------
<TABLE>
<CAPTION>
FUTURES CONTRACTS - LONG POSITION
<S> <C> <C> <C>
130 U.S. 5 Year Treasury Note,
June 2000 ........... $12,685,156 $(36,351)
=========== ========
----------------------
<FN>
* Aggregate cost for federal tax purposes.
** Securities on loan at April 30, 2000, which have an aggregate market value
of $355,689, represent 0.3% of the total net assets of the Fund (Note 7)
*** Security pledged as collateral for futures contract.
+ Variable rate security. The interest rate shown reflects the rate currently
in effect.
++ Security exempt from registration under Rule 144A of the Securities Act of
1933. This security may be resold in transactions exempt from registration,
normally to qualified institutional buyers.
</FN>
</TABLE>
--------------------------------------------------------------------------------
GLOSSARY OF TERMS
BALLOON -- Five- and seven-year mortgages with larger dollar amounts of
payments falling due in the later years of the obligation.
MTN -- Medium Term Note
--------------------------------------------------------------------------------
See Notes to Financial Statements.
68
<PAGE>
PORTFOLIO OF INVESTMENTS
U.S. GOVERNMENT SECURITIES FUND
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
--------- -----
U.S. GOVERNMENT AGENCY MORTGAGE-BACKED
SECURITIES - 73.6%
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION (GNMA) - 27.7%
<S> <C> <C>
$ 9,684,123 6.000% due 04/20/2026-02/20/2029 $ 8,770,766
3,281,616 6.500% due 03/15/2024 ........... 3,077,325
2,784,826 6.800% due 04/20/2025 ........... 2,640,075
41,967,540 7.000% due 07/15/2008-08/20/2029 40,380,336
49,037,162 7.500% due 03/15/2024-11/15/2029 48,255,508
6,978,630 7.750% due 12/15/2029 ........... 6,937,835
649,055 8.000% due 04/15/2022 ........... 651,812
805,170 8.500% due 05/15/2022 ........... 821,425
7,363,091 9.000% due 10/15/2008-06/15/2022 7,641,500
5,884,266 9.500% due 04/15/2016-08/15/2021 6,178,607
25,520 13.500% due 09/15/2014-12/15/2014 29,750
3,262 14.000% due 06/15/2011 .......... 3,811
-------------
Total GNMAs (Cost $128,901,126) . 125,388,750
-------------
FEDERAL NATIONAL MORTGAGE ASSOCIATION (FNMA) - 25.6%
22,352 5.500% due 02/01/2009 ........... 20,470
1,994,870 5.878% due 03/01/2008 ........... 1,935,808
9,470,457 6.000% due 11/01/2028-01/01/2029 8,582,819
49,844,486 6.500% due 11/01/2028-04/01/2029 46,539,716
29,498,873 7.000% due 06/01/2010-07/01/2029 28,289,110
15,748,865 7.500% due 12/01/2024-07/01/2029 15,452,229
2,519,180 8.000% due 05/01/2022-01/01/2025 2,518,072
360,644 8.500% due 02/01/2023-09/01/2025 366,526
211,218 9.000% due 06/01/2016-06/01/2021 217,435
3,307,246 6.820% due 02/01/2011 ........... 3,171,195
9,097,431 7.500% due 02/01/2030 ........... 8,920,861
-------------
Total FNMAs (Cost $121,662,659) . 116,014,241
-------------
FEDERAL HOME LOAN MORTGAGE CORPORATION (FHLMC) - 20.3%
26,580,567 6.500% due 02/01/2011-03/01/2029 25,220,970
17,018,895 7.000% due 07/01/2024-07/01/2029 16,302,995
38,595,890 7.500% due 07/01/2002-03/01/2013 38,450,143
10,041,611 8.500% due 04/01/2019-07/01/2029 10,217,962
512,448 8.750% due 01/01/2013 ........... 528,401
827,530 9.000% due 12/01/2008-08/01/2022 851,890
264,534 9.500% due 06/01/2016-05/01/2017 278,026
-------------
Total FHLMCs (Cost $95,181,180) 91,850,387
-------------
Total U.S. Government Agency
Mortgage-Backed Securities
(Cost $345,744,965) ........... 333,253,378
-------------
COLLATERALIZED MORTGAGE OBLIGATIONS (CMO) - 12.8%
Federal Home Loan Mortgage Corporation:
1,771,215 Series 1049, Class F,
7.088% due 02/15/2021+ ........ 1,797,419
447,590 Series 1288, Class HA,
5.500% due 11/15/2020 ......... 442,199
4,770,000 Series 1638, Class K,
6.500% due 03/15/2023 ......... 4,501,664
PRINCIPAL
AMOUNT VALUE
--------- -----
$ 2,000,000 Series 1652, Class Pl,
7.000% due 01/15/2024 ......... $ 1,881,090
7,500,000 Series 1981, Class C,
6.500% due 08/15/2027 ......... 6,931,941
4,512,428 Series 2073, Class VA,
6.500% due 12/15/2005 ......... 4,398,512
5,000,000 Series 2076, Class PB,
6.000% due 10/15/2017 ......... 4,886,775
Federal National Mortgage Association:
3,118,685 Series 1989-18, Class C,
9.500% due 04/25/2004 ......... 3,189,661
1,318,034 Series 1990-49, Class G,
9.000% due 05/25/2020 ......... 1,355,958
1,727,612 Series 1992-83, Class X,
7.000% due 02/25/2022 ......... 1,649,089
642,451 Series 1993-103, Class FA,
6.606% due 06/25/2019 ......... 642,105
4,200,000 Series 1993-103, Class PG,
6.250% due 06/25/2019 ......... 4,146,723
2,993,637 Series 1993-162, Class E,
6.000% due 08/25/2023 ......... 2,762,256
5,000,000 Series 1993-163, Class BE,
7.000% due 10/25/2021 ......... 4,833,953
1,669,709 Series 1994-643, Class JC,
7.500% due 08/25/2001 ......... 1,670,937
1,995,617 Series 1997-32, Class FA,
6.756% due 04/25/2027 ......... 2,014,397
5,708,184 Series 1997-40, Class PE,
6.750% due 07/18/2019 ......... 5,675,048
509,184 Series 1997-M1 Class A,
6.784% due 01/17/2003 ......... 507,973
2,230,000 Series G93-11, Class D,
6.000% due 08/25/2007 ......... 2,212,729
6,028,331 Trust 259 STRIP,
7.000% due 04/01/2024 ......... 1,876,787
473,887 L.F. Rothschild Mortage Trust,
Series 3, Class Z,
9.950% due 09/01/2017 ......... 501,630
-------------
Total CMOs (Cost $57,723,204) ... 57,878,846
-------------
U.S. GOVERNMENT AGENCY OBLIGATIONS - 7.1%
Federal Home Loan Banks, Bond:
3,000,000 6.135% due 02/17/2009 ......... 2,725,770
6,500,000 6.810% due 08/20/2007 ......... 6,188,065
2,000,000 Federal National Mortgage Association,
MTN,
6.000% due 01/14/2005 ......... 1,892,276
Federal National Mortgage Association,
Note:
10,000,000 5.125% due 10/15/2008 ......... 8,608,180
12,500,000 6.000% due 05/15/2008 ......... 11,511,125
1,250,000 Federal National Mortgage
Association, Deb.,
6.210% due 08/06/2038 ......... 1,089,242
-------------
Total U.S. Government Agency
Obligations
(Cost $35,203,842) ............ 32,014,658
-------------
</TABLE>
See Notes to Financial Statements.
69
<PAGE>
PORTFOLIO OF INVESTMENTS (CONTINUED)
U.S. GOVERNMENT SECURITIES FUND
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
--------- -----
U.S. TREASURY OBLIGATIONS - 2.9%
U.S. TREASURY BONDS - 2.7%
<S> <C> <C> <C>
U.S. Treasury Bond:
$ 7,000,000 8.125% due 08/15/2019** ...... $ 8,408,750
3,250,000 7.250% due 08/15/2022** ...... 3,629,844
-------------
12,038,594
-------------
U.S. TREASURY NOTE - 0.2%
1,100,000 U.S. Treasury Note,
6.500% due 10/15/2006** ...... 1,098,282
-------------
Total U.S. Treasury Obligations
(Cost $13,699,690) ........... 13,136,876
-------------
REPURCHASE AGREEMENT - 3.1%
(COST $14,161,000)
14,161,000 Agreement with Goldman Sachs &
Company, 5.640% dated 04/28/2000,
to be repurchased at $14,167,656
on 05/01/2000, collateralized
by $12,186,853 U.S. Treasury Note,
7.500% due 11/15/2024 (Market
Value $14,505,369) ........... 14,161,000
-------------
TOTAL INVESTMENTS (Cost $466,532,701*) 99.5% 450,444,758
OTHER ASSETS AND LIABILITIES (NET) ... 0.5 2,129,023
----- -------------
NET ASSETS ........................... 100.0% $452,573,781
===== ============
=========================
<FN>
* Aggregate cost for federal tax puposes.
** Securities on loan at April 30, 2000, which have an aggregate market
value of $13,269,301, represent 2.9% of the total net assets of the Fund
(Note 7).
+ Variable rate security. The interest rate shown reflects the rate currently
in effect.
</FN>
</TABLE>
------------------------------------------------------------------
GLOSSARY OF TERMS
MTN -- Medium Term Note
STRIP -- Separate trading of registered interest and
principal of securities
------------------------------------------------------------------
See Notes to Financial Statements.
70
<PAGE>
PORTFOLIO OF INVESTMENTS
INCOME FUND
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
--------- -----
CORPORATE BONDS AND NOTES - 60.1%
INDUSTRIAL - 13.1%
<CAPTION>
<S> <C> <C>
$ 250,000 Battle Mountain Gold Company,
Conv Note,
6.000% due 01/04/2005 ......... $ 147,599
Black & Decker Corporation, Note:
185,000 7.500% due 04/01/2003 ......... 183,248
50,000 7.000% due 02/01/2006 ......... 47,963
5,000,000 Cendant Corporation, Note,
7.750% due 12/01/2003 ......... 4,930,960
550,000 Comcast Cable Communication, Note,
6.200% due 11/15/2008 ......... 481,973
Conagra, Inc., Sr. Note:
750,000 9.750% due 03/01/2021 ......... 824,178
843,000 6.700% due 08/01/2027 ......... 773,652
350,000 CPC International, Inc., Note,
6.150% due 01/15/2006 ......... 328,917
500,000 Crane Company, Note,
8.500% due 03/15/2004 ......... 514,697
300,000 CSR America, Inc., Note,
6.875% due 07/21/2005 ......... 287,971
493,000 Golden Books Publishing Company,
Secured Bond,
10.750% due 12/31/2004 ........ 285,940
400,000 Honeywell, Inc., Note,
6.600% due 04/15/2001 ......... 397,234
675,000 Ingersoll-Rand Company, Sr. Note,
6.255% due 02/15/2001 ......... 669,443
1,400,000 Integrated Device Technology, Inc.,
Conv. Sub. Note,
5.500% due 06/01/2002 ......... 2,413,250
200,000 International Business Machines
Corporation, Note,
6.375% due 06/15/2000 ......... 199,900
1,500,000 Jackson Products, Inc.,
Company Guarantee,
9.500% due 04/15/2005 ......... 1,372,500
2,000,000 Laidlaw Inc., Note,
7.650% due 05/15/2006 ......... 750,000
250,000 Lennar Corporation, Sr. Note,
7.625% due 03/01/2009 ......... 213,337
955,000 Lockheed Martin Corporation,
Company Guarantee,
7.750% due 05/01/2026 ......... 861,651
Loral Corporation, Deb.:
1,000,000 8.375% due 06/15/2024 ......... 978,471
1,000,000 7.625% due 06/15/2025 ......... 901,261
2,250,000 Loral Space & Communications
Ltd., Sr. Note,
9.500% due 01/15/2006 ......... 1,530,000
540,000 Nabisco, Inc., Note,
6.000% due 02/15/2001 ......... 528,838
6,500,000 Ogden Corporation, Deb.,
9.250% due 03/01/2022 ......... 7,133,237
6,860,000 Praxair, Inc., Deb.,
8.700% due 07/15/2022 ......... 7,151,118
PRINCIPAL
AMOUNT VALUE
--------- -----
Raytheon Company:
$ 750,000 Deb.,
7.200% due 08/15/2027 ......... $ 634,999
Note:
2,385,000 5.950% due 03/15/2001 ......... 2,347,274
1,070,000 6.450% due 08/15/2002 ......... 1,037,272
Royal Caribbean Cruises Ltd.,
Sr. Note:
426,000 7.125% due 09/18/2002 ......... 407,320
111,000 7.250% due 08/15/2006 ......... 100,215
2,000,000 S3, Inc., Conv. Note,
5.750% due 10/01/2003 ......... 1,835,000
5,260,000 Time Warner, Inc., Deb.,
9.150% due 02/01/2023 ......... 5,709,514
USA Waste Services, Inc.,
Sr. Note:
495,000 7.125% due 10/01/2007 ......... 422,548
1,000,000 7.000% due 07/15/2028 ......... 728,665
1,200,000 Veterinary Centers of America,
Conv. Sub. Deb.,
5.250% due 05/01/2006 ......... 1,051,500
1,000,000 V.F. Corporation, Note,
9.500% due 05/01/2001 ......... 1,020,055
Waste Management, Inc.:
750,000 Conv. Sub. Note,
4.000% due 02/01/2002 ......... 671,250
1,145,000 Note,
7.700% due 10/01/2002 ......... 1,083,802
3,450,000 Sr. Note,
6.875% due 05/15/2009 ......... 2,825,988
-------------
53,782,740
-------------
BANKS - 8.2%
400,000 Banc One Corporation, Sub. Note,
10.000% due 08/15/2010 ........ 452,054
1,000,000 BankAmerica Corporation, Sub. Note,
6.625% due 08/01/2007 ......... 940,441
1,000,000 Bank of New York, Sub. Note,
7.875% due 11/15/2002 ......... 1,002,463
1,000,000 Barnett Banks, Florida, Inc.,
Sub. Note,
10.875% due 03/15/2003 ........ 1,072,868
690,000 BB&T Corporation, Sub. Note,
7.250% due 06/15/2007 ......... 654,997
1,000,000 Chase Manhattan Corporation,
Sub. Note,
8.500% due 02/15/2002 ......... 1,015,427
1,000,000 Citicorp, Sub. Note,
8.000% due 02/01/2003 ......... 1,006,349
Federal Home Loan Mortgage
Corporation, Note:
10,000,000 6.875% due 01/15/2005 ......... 9,853,520
10,000,000 7.000% due 03/15/2010 ......... 9,801,350
1,100,000 First Interstate Bancorp, Sub. Note,
9.125% due 02/01/2004 ......... 1,142,423
1,000,000 First Nationwide Bank, Sub. Deb.,
10.000% due 10/01/2006 ........ 1,095,940
246,000 First Union Corporation, Sub. Note,
9.450% due 08/15/2001 ......... 252,244
</TABLE>
See Notes to Financial Statements.
71
<PAGE>
PORTFOLIO OF INVESTMENTS (CONTINUED)
INCOME FUND
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
--------- -----
CORPORATE BONDS AND NOTES (CONTINUED)
BANKS (CONTINUED)
<S> <C> <C>
$ 995,000 Fleet Financial Group, Inc.,
Sub. Deb.,
6.875% due 01/15/2028 ......... $ 865,024
1,000,000 Key Bank NA, Sub. Deb.,
6.950% due 02/01/2028 ......... 871,130
1,000,000 Manufacturers & Trade Trust
Company, Sub. Note,
8.125% due 12/01/2002 ......... 1,002,721
500,000 Mercantile Bank, Sub. Note,
7.625% due 10/15/2002 ......... 497,425
670,000 NationsBank Corporation,
Sub. Note,
6.800% due 03/15/2028 ......... 576,638
1,000,000 Norwest Bancorp, Sub. Deb.,
6.650% due 10/15/2023 ......... 856,268
500,000 Summit Bancorp, Sub. Note,
8.625% due 12/10/2002 ......... 508,798
-------------
33,468,080
-------------
FOREIGN (U.S. DOLLAR DENOMINATED) - 7.3%
175,000 Abbey National First Capital,
Sub. Note,
8.200% due 10/15/2004 ......... 175,512
4,500,000 HIH Capital Ltd., Conv. Note,
7.500% due 09/25/2006 ......... 2,781,362
1,000,000 Hyder Plc, Bond,
6.750% due 12/15/2004++ ....... 948,230
8,500,000 Petro-Canada, Deb.,
9.250% due 10/15/2021 ......... 9,603,368
1,650,000 Republic of Korea, Unsub. Note,
8.875% due 04/15/2008 ......... 1,705,687
1,750,000 SB Treasury Company LLC, Bond,
9.400% to 06/30/2008;
10.925% due 12/29/2049++ ...... 1,707,830
2,490,000 Ssangyong Oil Refining Company,
Conv. Deb.,
3.750% due 12/31/2008 ......... 2,875,950
2,500,000 Tatneft Finance Plc, Company
Guarantee,
9.000% due 10/29/2002++ ....... 1,981,250
1,500,000 Tokai Pfd Capital Company, Bond,
9.980% to 06/30/2008;
11.091% due 12/29/2049++ ...... 1,462,915
500,000 Total Access Communications,
Conv. Note,
2.000% due 05/31/2006 ......... 561,250
5,750,000 Trans-Canada Pipeline Corporation,
Deb.,
8.500% due 03/20/2023 ......... 5,938,123
-------------
29,741,477
-------------
TRANSPORTATION - 7.2%
Burlington Northern Santa Fe:
5,000,000 Deb.,
8.125% due 04/15/2020 ......... 4,965,295
1,500,000 Note,
8.750% due 02/25/2022 ......... 1,595,358
3,030,000 Consolidated Rail Corporation,
Deb.,
9.750% due 06/15/2020 ......... 3,522,645
PRINCIPAL
AMOUNT VALUE
--------- -----
$ 250,000 Equimar Shipholdings Ltd.,
Company Guarantee,
9.875% due 07/01/2007 ......... $ 111,250
5,000,000 Norfolk Southern Corporation,
Sr. Note,
6.200% due 04/15/2009 ......... 4,385,655
United Air Lines, Inc.:
5,000,000 Equipment Trust Certificates,
10.850% due 07/05/2014 ........ 5,702,860
Pass-through Certificates:
3,000,000 9.080% due 10/26/2015 ......... 3,171,105
5,500,000 9.560% due 10/19/2018 ......... 6,051,513
-------------
29,505,681
-------------
FINANCIAL - 6.7%
80,000 Associates Corporation NA, Sr. Note,
6.625% due 05/15/2001 ......... 79,522
9,000,000 Barclays North American Capital
Corporation, Deb.,
9.750% due 05/15/2021 ......... 9,565,938
2,000,000 Continental Corporation, Note,
7.250% due 03/01/2003 ......... 1,915,642
440,000 Equitable Companies Inc., Deb.,
7.000% due 04/01/2028 ......... 384,246
1,000,000 GATX Leasing Corporation, MTN,
10.000% due 03/21/2001 ........ 1,016,104
500,000 Jefferson-Pilot Capital Trust A,
Bond,
8.140% due 01/15/2046++ ....... 438,876
100,000 Jefferson-Pilot Capital Trust B,
Company Guarantee,
8.285% due 03/01/2046++ ....... 89,310
1,250,000 Kemper Corporation, Note,
6.875% due 09/15/2003 ......... 1,209,357
495,000 MBNA America Bank NA, Note,
6.920% due 05/30/2000 ......... 495,205
Merrill Lynch & Company Inc., Note:
5,000,000 6.000% due 02/17/2009 ......... 4,408,175
1,450,000 6.500% due 07/15/2018 ......... 1,242,472
2,000,000 6.750% due 06/01/2028 ......... 1,705,268
Paine Webber Group, Inc., Sr. Note:
830,000 8.060% due 01/17/2017 ......... 798,030
415,000 7.390% due 10/16/2017 ......... 372,303
500,000 PNC Institute Capital B,
Company Guarantee,
8.315% due 05/15/2027++ ....... 475,298
2,500,000 Superior Financial Corporation,
Sr. Note,
8.650% due 04/01/2003 ......... 2,405,530
500,000 Travelers Property Casualty
Corporation, Note,
6.750% due 04/15/2001 ......... 496,637
505,000 US Leasing International,
Corporation, Sr. Note,
8.750% due 12/01/2001 ......... 511,914
-------------
27,609,827
-------------
</TABLE>
See Notes to Financial Statements.
72
<PAGE>
PORTFOLIO OF INVESTMENTS (CONTINUED)
INCOME FUND
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
--------- -----
CORPORATE BONDS AND NOTES (CONTINUED)
AUTO - 5.1%
<S> <C> <C>
$ 2,000,000 Ford Holdings, Inc., Deb.,
9.375% due 03/01/2020 ......... $ 2,233,244
Ford Motor Company, Deb.:
3,750,000 8.900% due 01/15/2032 ......... 4,062,514
825,000 7.400% due 11/01/2046 ......... 750,833
5,000,000 Ford Motor Credit Company,
Sr. Note,
5.800% due 01/12/2009 ......... 4,366,705
General Motors Corporation, Deb.:
350,000 9.625% due 12/01/2000 ......... 354,584
8,000,000 9.400% due 07/15/2021 ......... 9,171,456
-------------
20,939,336
-------------
GAMING - 3.2%
5,000,000 Circus Circus Enterprise, Deb.,
7.000% due 11/15/2036 ......... 4,130,055
1,500,000 Louisiana Casino Cruises, Note,
11.000% due 12/01/2005 ........ 1,522,500
5,000,000 Park Place Entertainment,
Sr. Note,
8.500% due 11/15/2006 ......... 4,811,220
1,250,000 Riviera Black Hawk Inc.,
First Mortgage,
13.000% due 05/01/2005 ........ 1,343,750
1,350,000 Riviera Holdings Corporation,
Company Guarantee,
10.000% due 08/15/2004** ...... 1,221,750
-------------
13,029,275
-------------
HEALTH CARE - 2.4%
1,500,000 Aetna Services, Inc.,
Company Guarantee,
7.625% due 08/15/2026 ......... 1,348,105
1,500,000 American Home Products
Corporation, Deb.,
7.250% due 03/01/2023 ......... 1,407,687
1,500,000 Beverly Enterprises, Inc.,
Company Guarantee,
9.000% due 02/15/2006 ......... 1,278,750
1,047,000 CII Financial Inc., Conv. Note,
7.500% due 09/15/2001 ......... 730,282
200,000 Dura Pharmaceuticals, Inc.,
Sub. Note,
3.500% due 07/15/2002 ......... 163,750
750,000 DVI, Inc., Sr. Note,
9.875% due 02/01/2004 ......... 690,938
3,000,000 FHP International, Sr. Note,
7.000% due 09/15/2003 ......... 2,841,621
1,800,000 Medical Care International Inc.
(Columbia), Conv. Sub. Deb.,
6.750% due 10/01/2006++ ....... 1,575,000
-------------
10,036,133
-------------
UTILITIES/TELECOMMUNICATIONS - 1.9%
300,000 Avon Energy Partners Holding
Sr. Note,
6.730% due 12/11/2002++ ....... 290,494
PRINCIPAL
AMOUNT VALUE
--------- -----
$ 1,030,000 National Rural Utilities
Cooperative Finance Corporation,
Collateral Trust,
5.700% due 01/15/2010 ......... $ 887,945
1,396,000 Niagara Mohawk Power Corporation,
Deb.,
8.770% due 01/01/2018 ......... 1,464,623
3,000,000 Texas Utilites Electric Company,
First Mortgage,
8.750% due 11/01/2023 ......... 2,971,614
220,000 Texas-New Mexico Power Company,
Sr. Note,
6.250% due 01/15/2009 ......... 184,261
1,000,000 Voicestream Wire Company,
Sr. Discount Note,
Zero Coupon to 11/15/2004;
11.875% thereafter,
10.375% due 11/15/2009++ ...... 1,020,000
996,000 Worldcom, Inc., Note,
6.125% due 08/15/2001 ......... 983,523
-------------
7,802,460
-------------
OIL & GAS - 1.9%
1,600,000 Burlington Resources, Deb.,
9.125% due 10/01/2021 ......... 1,743,819
5,950,000 Phillips Petroleum Company, Deb.,
9.180% due 09/15/2021 ......... 5,942,170
-------------
7,685,989
-------------
REAL ESTATE INVESTMENT TRUSTS - 1.7%
2,000,000 American Health Properties, Inc.,
Note,
7.500% due 01/15/2007 ......... 1,801,124
500,000 Developers Diversified Realty,
MTN, Sr. Note,
6.580% due 02/06/2001 ......... 494,335
Franchise Finance Corporation:
3,000,000 MTN,
7.070% due 01/15/2008 ......... 2,666,619
Sr. Note:
900,000 7.000% due 11/30/2000 ......... 894,962
1,100,000 7.875% due 11/30/2005 ......... 1,052,121
-------------
6,909,161
-------------
RETAIL SALES - 1.4%
5,000,000 Safeway Inc., Note,
7.500% due 09/15/2009 ......... 4,805,530
866,000 Saks, Inc., Company Guarantee,
8.250% due 11/15/2008 ......... 757,943
-------------
5,563,473
-------------
Total Corporate Bonds and Notes
(Cost $250,011,682) ........... 246,073,632
-------------
U.S. GOVERNMENT AGENCY MORTGAGE-BACKED
SECURITIES - 17.5%
FEDERAL HOME LOAN MORTGAGE CORPORATION (FHLMC) - 6.7%
719,232 #C00362
9.000% due 06/01/2024 ......... 740,404
7,874,614 #C0070
6.500% due 01/01/2029 ......... 7,359,788
</TABLE>
See Notes to Financial Statements.
73
<PAGE>
PORTFOLIO OF INVESTMENTS (CONTINUED)
INCOME FUND
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
--------- -----
U.S. GOVERNMENT AGENCY MORTGAGE-BACKED
SECURITIES (CONTINUED)
FEDERAL HOME LOAN MORTGAGE CORPORATION
(FHLMC) (CONTINUED)
<S> <C> <C>
$ 7,270,136 #C00785
6.500% due 06/01/2029 ......... $ 6,794,829
11,953,469 #C29918
6.500% due 08/01/2029 ......... 11,171,975
259,148 #C80253
9.000% due 01/01/2025 ......... 266,776
1,160,205 #G10735
7.500% due 09/01/2012 ......... 1,154,909
-------------
Total FHLMCs (Cost $28,139,441) . 27,488,681
-------------
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION
(GNMA) - 5.1%
82,832 9.000% due 12/01/2004 ........... 84,019
541,241 6.500% due 08/15/2023 ........... 507,547
1,509,533 6.500% due 12/15/2023 ........... 1,415,560
332,848 7.500% due 12/15/2023 ........... 328,623
1,904,952 6.000% due 02/15/2024 ........... 1,732,430
1,491,643 6.500% due 03/15/2024 ........... 1,398,784
1,331,754 6.500% due 07/15/2024 ........... 1,255,102
136,468 8.000% due 06/15/2027 ........... 137,047
1,318,513 8.000% due 08/15/2027 ........... 1,324,114
348,314 7.500% due 01/15/2028 ........... 342,762
226,933 7.500% due 02/15/2028 ........... 223,316
699,674 7.500% due 03/15/2028 ........... 688,521
442,715 7.500% due 08/15/2028 ........... 435,658
468,355 7.500% due 10/15/2028 ........... 460,889
10,974,805 7.000% due 02/20/2030 ........... 10,513,150
-------------
Total GNMAs (Cost $21,174,319) .. 20,847,522
-------------
FEDERAL NATIONAL MORTGAGE ASSOCIATION
(FNMA) - 5.7%
1,199,155 6.000% due 08/01/2013 ........... 1,123,530
576,044 5.500% due 03/01/2014 ........... 527,547
914,278 5.500% due 03/01/2014 ........... 837,305
314,122 7.536% due 06/01/2016 ........... 310,096
49,213 7.000% due 07/01/2022 ........... 47,112
140,933 7.000% due 07/01/2023 ........... 134,917
54,499 7.000% due 08/01/2026 ........... 52,173
100,564 7.000% due 09/01/2026 ........... 96,271
18,462 7.000% due 11/01/2026 ........... 17,674
3,224,896 6.500% due 09/01/2028 ........... 3,011,037
2,740,984 6.500% due 11/01/2028 ........... 2,559,216
125,692 6.000% due 02/01/2029 ........... 113,837
960,467 6.000% due 03/01/2029 ........... 869,881
944,985 6.000% due 04/01/2029 ........... 855,859
PRINCIPAL
AMOUNT VALUE
--------- -----
$ 4,969,555 7.000% due 01/01/2030 ........... $ 4,757,405
8,000,000 7.630% due 02/01/2010 ........... 7,982,092
-------------
Total FNMAs (Cost $24,153,343) .. 23,295,952
-------------
Total U.S. Government Agency
Mortgage-Backed Securities
(Cost $73,467,103) ............ 71,632,155
-------------
COLLATERALIZED MORTGAGE OBLIGATIONS (CMO) - 1.9%
1,750,000 Donaldson, Lufkin & Jenrette
Acceptance Corporation,
1993-MF17 A2,
7.350% due 12/18/2003 ......... 1,747,501
1,349,159 Donaldson, Lufkin & Jenrette
Acceptance Corporation,
1995-Q10 B1,
8.461% due 12/10/2026 ......... 1,210,796
149,561 Federal National Mortgage
Association, Series 1996-M7B,
6.858% due 06/17/2011 ......... 149,253
1,491,251 Federal National Mortgage
Association, Series 1997-42,
7.250% due 03/18/2026 ......... 1,471,256
354,356 Resolution Trust Corporation,
1991-M2 A2,
7.132% due 09/25/2020 ......... 336,923
2,791,958 Weyerhauser Mortgage Corporation,
1982-C FHA Putable,
7.430% due 08/01/2022 ......... 2,770,355
-------------
Total CMOs
(Cost $7,688,665) ............. 7,686,084
-------------
U.S. TREASURY OBLIGATIONS - 14.7%
U.S. TREASURY NOTES - 9.6%
U.S. Treasury Notes:
7,500,000 6.000% due 08/15/2004** ....... 7,345,313
25,000,000 5.625% due 05/15/2008** ....... 23,765,625
8,300,000 6.000% due 08/15/2009** ....... 8,102,875
-------------
39,213,813
-------------
U.S. TREASURY BONDS - 5.1%
U.S. Treasury Bond:
3,985,000 7.250% due 08/15/2022 ......... 4,450,747
10,500,000 6.250% due 08/15/2023 ......... 10,506,563
1,500,000 6.125% due 11/15/2027 ......... 1,485,938
5,000,000 5.250% due 11/15/2028 ......... 4,387,500
-------------
20,830,748
-------------
Total U.S. Treasury Obligations
(Cost $60,688,306) ............ 60,044,561
-------------
SHARES
------
PREFERRED STOCKS - 0.1%
<S> <C> <C>
7,000 California Federal, Series A,
Conv. Pfd.,
9.125% due 01/31/2002 ......... 155,750
15,100 First Industrial Realty Trust
Inc., Series A, Conv. Pfd.,
9.500% due 11/17/2000 ......... 334,088
-------------
Total Preferred Stocks
(Cost $563,630) ............... 489,838
-------------
</TABLE>
See Notes to Financial Statements.
74
<PAGE>
PORTFOLIO OF INVESTMENTS (CONTINUED)
INCOME FUND
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
SHARES VALUE
------ -----
COMMON STOCK - 0.0%#
(COST $118,997)
<S> <C> <C> <C>
24,083 Golden Books Family Entertainment $ 26,341
------------
PRINCIPAL
AMOUNT
---------
REPURCHASE AGREEMENT - 3.6%
(COST $14,779,000)
$14,779,000 Agreement with Goldman Sachs &
Company, 5.640% dated 04/28/2000,
to be repurchased at $14,785,946
on 05/01/2000, collateralized by
$12,718,699 U.S. Treasury Note,
7.500% due 11/15/2024
(Market Value $15,138,397) ... 14,779,000
-------------
TOTAL INVESTMENTS (Cost $407,317,383) .. 97.9% 400,731,611
OTHER ASSETS AND LIABILITIES (NET) ..... 2.1 8,478,076
----- -------------
NET ASSETS ............................. 100.0% $409,209,687
===== ============
----------------------
<FN>
* Aggregate cost for federal tax purposes.
** Securities on loan at April 30, 2000, which have an aggregate market value
of $15,440,965, represent 3.8% of the total net assets of the Fund (Note 7).
# Amount represents less than 0.1% of net assets.
++ Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration normally to qualified institutional buyers.
</FN>
</TABLE>
--------------------------------------------------
GLOSSARY OF TERMS
FHA -- Federal Housing Authority
MTN -- Medium Term Note
--------------------------------------------------
See Notes to Financial Statements.
75
<PAGE>
PORTFOLIO OF INVESTMENTS
HIGH YIELD FUND
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
--------- -----
CORPORATE BONDS AND NOTES - 78.7%
TELECOMMUNICATIONS/MEDIA - 16.4%
<S> <C> <C>
$ 7,050,000 Charter Communications Holdings
LLC, Sr. Note,
8.625% due 04/01/2009 ......... $ 6,195,188
3,000,000 ICO Global Communications, Units,
15.000% due 08/01/2005 ........ 1,755,000
3,250,000 Loral Space & Communications Ltd.,
Sr. Note,
9.500% due 01/15/2006++ ....... 2,210,000
5,000,000 Nextlink Communications Inc.,
Sr. Note,
10.750% due 06/01/2009 ........ 4,937,500
5,000,000 Voicestream Wire Company, Sr. Note,
Zero coupon to 11/15/2004;
11.875% thereafter,
10.375% due 11/15/2009++ ...... 5,100,000
5,500,000 Winstar Communications Inc.,
Sr. Note,
12.750% due 04/15/2010++ ...... 5,280,000
2,000,000 XM Satellite Radio Inc., Units,
14.000% due 03/15/2010++ ...... 1,810,000
-------------
27,287,688
-------------
FOREIGN (U.S. DOLLAR DENOMINATED) - 15.3%
1,000,000 @ Entertainment Inc., Sr. Disc.
Note, Zero coupon to 07/15/2003;
14.500% due 07/15/2008** ...... 655,000
5,800,000 @ Entertainment Inc., Sr. Disc.
Note, Zero coupon to 02/01/2004;
14.500% due 02/01/2009 ........ 3,567,000
HIH Capital Ltd., Conv. Note:
2,305,000 7.500% due 09/25/2006 ......... 1,424,676
1,300,000 7.500% due 09/25/2006++ ....... 786,500
7,000,000 Mexican United States, Bond,
9.875% due 02/01/2010 ......... 7,227,500
Philippine Long Distance Telephone
Company, MTN:
1,500,000 7.850% due 03/06/2007 ......... 1,269,300
1,000,000 10.500% due 04/15/2009 ........ 957,158
3,050,000 SB Treasury Company LLC, Bond,
9.400% to 06/30/2008;
10.925% due 12/29/2049++ ...... 2,976,504
1,415,000 Ssangyong Oil Refining Company,
Conv. Deb.,
3.750% due 12/31/2008 ......... 1,634,325
3,600,000 Tokai Pfd Capital Company, Bond,
9.980% to 06/30/2008;
11.091% due 12/29/2049++ ...... 3,510,997
1,060,000 Total Access Communications, Conv.
Note,
2.000% due 05/31/2006 ......... 1,189,850
1,000,000 V2 Music Holdings Plc, Sr. Disc.
Note, Zero coupon to 04/15/2003;
14.000% due 04/15/2008++ ...... 295,000
-------------
25,493,810
-------------
PRINCIPAL
AMOUNT VALUE
--------- -----
INFORMATION TECHNOLOGY - 13.2%
$ 1,000,000 Adaptec Inc., Conv. Sub. Note,
4.750% due 02/01/2004 ......... $ 836,250
1,750,000 Arbor Software, Conv. Sub.Note,
4.500% due 03/15/2005 ......... 1,452,500
2,000,000 Credence Systems Corporation,
Conv. Sub. Note,
5.250% due 09/15/2002 ......... 4,332,500
4,500,000 Exodus Communications Inc.,
Sr. Note,
10.750% due 12/15/2009 ........ 4,511,250
2,000,000 HMT Technology Corporation,
Conv. Sub. Note,
5.750% due 01/15/2004 ......... 872,500
1,898,000 Integrated Device Technology Inc.,
Conv. Sub. Note,
5.500% due 06/01/2002 ......... 3,271,678
10,341,000 Networks Associates Inc.,
Conv. Sub. Deb.,
Zero coupon due 02/13/2018 .... 3,696,908
3,350,000 S3 Inc., Conv. Sub. Note,
5.750% due 10/01/2003 ......... 3,073,625
-------------
22,047,211
-------------
HEALTH CARE - 13.2%
7,150,000 Beverly Enterprises, Inc.
Gtd. Deb.,
9.000% due 02/15/2006** ....... 6,095,375
279,000 CII Financial Inc., Conv. Note,
7.500% due 09/15/2001 ......... 194,602
500,000 Columbia/HCA Healthcare
Corporation, Note,
7.750% due 07/15/2036 ......... 401,420
2,800,000 Dura Pharmaceuticals Inc.,
Conv. Sub. Note,
3.500% due 07/15/2002 ......... 2,292,500
6,400,000 DVI Inc., Sr. Note,
9.875% due 02/01/2004 ......... 5,896,000
550,000 Mariner Post - Acute Network,
Sub. Note,
9.500% due 11/01/2007 ......... 2,750
4,321,000 Medical Care International Inc.
(Columbia), Conv. Sub. Deb.,
6.750% due 10/01/2006++ ....... 3,780,875
1,870,000 Omnicare Inc., Conv. Bond,
5.000% due 12/01/2007 ......... 1,474,962
5,000,000 PhyCor Inc., Conv. Sub. Deb.,
4.500% due 02/15/2003 ......... 1,837,500
-------------
21,975,984
-------------
SERVICE - 8.1%
6,815,000 Veterinary Centers of America,
Conv. Sub. Deb.,
5.250% due 05/01/2006 ......... 5,971,644
8,450,000 Waste Management Inc., Conv.
Sub. Note,
4.000% due 02/01/2002 ......... 7,562,750
-------------
13,534,394
-------------
</TABLE>
See Notes to Financial Statements.
76
<PAGE>
PORTFOLIO OF INVESTMENTS (CONTINUED)
HIGH YIELD FUND
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
--------- -----
CORPORATE BONDS AND NOTES (CONTINUED)
GAMING - 7.4%
<S> <C> <C>
$ 953,000 Isle of Capri Black Hawk LLC,
First Mortgage,
13.000% due 08/31/2004 ........ $ 1,041,152
2,000,000 Louisiana Casino Cruises, Note,
11.000% due 12/01/2005 ........ 2,030,000
4,125,000 Majestic Star LLC, Company
Guarantee,
10.875% due 07/01/2006 ........ 3,856,875
2,715,000 Riviera Black Hawk Inc.,
First Mortgage,
13.000% due 05/01/2005 ........ 2,918,625
2,662,000 Riviera Holdings Corporation,
Company Guarantee,
10.000% due 08/15/2004 ........ 2,409,110
-------------
12,255,762
-------------
TRANSPORTATION - 2.4%
9,079,000 Equimar Shipholdings Ltd.,
Gtd. Deb.,
9.875% due 07/01/2007 ......... 4,040,155
-------------
CONSUMER NON-DURABLES - 1.3%
12,900,000 Sunbeam Corporation,
Sr. Sub. Deb.,
Zero coupon due 03/25/2018 .... 2,225,250
-------------
MANUFACTURING - 1.0%
1,750,000 Jackson Products Inc.,
Company Guarantee,
9.500% due 04/15/2005 ......... 1,601,250
-------------
FOREIGN (U.S. NON-DOLLAR DENOMINATED) - 0.4%
525,000 IPC Magazines Plc, Bond,
9.625% due 03/15/2008 ......... 686,593
-------------
Total Corporate Bonds and Notes
(Cost $131,656,645) ........... 131,148,097
-------------
U.S. TREASURY NOTE - 4.2%
(COST $7,083,633)
7,000,000 6.500% due 10/15/2006 ........... 6,989,066
-------------
COLLATERALIZED MORTGAGE OBLIGATION - 0.2%
(COST $388,457)
415,462 Donaldson, Lufkin & Jenrette
Mortgage Acceptance Corporation,
1995-Q10 B1,
8.461% due 01/25/2026 ......... 372,854
-------------
SHARES
------
COMMON STOCKS - 7.6%
217,200 Health Care Property Investors,
Inc. .......................... 6,054,450
604,500 Huntingdon Life Sciences Group
Plc, ADR+ ..................... 604,500
455,100 Nationwide Health Properties Inc. 6,030,075
-------------
12,689,025
-------------
Total Common Stocks
(Cost $12,856,588) ............ 12,689,025
-------------
SHARES VALUE
--------- -----
PREFERRED STOCK - 2.0%
(COST $3,353,861)
145,900 First Industrial Realty Trust Inc.,
Series A, Conv. Pfd.,
9.500% due 11/17/2000 ......... $ 3,228,038
-------------
WARRANTS - 0.0%#
(COST $10)
1,000 V2 Music Holdings Plc,
Expires 04/15/2008+,++ ........ 10
-------------
PRINCIPAL
AMOUNT
---------
<S> <C> <C> <C>
REPURCHASE AGREEMENT - 5.9%
(COST $9,903,000)
$ 9,903,000 Agreement with Goldman Sachs &
Company, 5.640% dated 04/28/2000,
to be repurchased at $9,907,654
on 05/01/2000, collateralized
by $8,522,449 U.S. Treasury Note,
7.500% due 11/15/2024
(Market Value $10,143,822) .... 9,903,000
------------
TOTAL INVESTMENTS (Cost $165,242,194*) 98.6% 164,330,090
OTHER ASSETS AND LIABILITIES (NET) .... 1.4 2,389,107
------ ------------
NET ASSETS ............................ 100.0% $166,719,197
====== ============
========================
<FN>
* Aggregate cost for federal tax purposes.
** Securities on loan at April 30, 2000, which have an aggregate market
value of $4,422,375, represent 2.7% of the total net assets of the Fund
(Note 7).
# Amount represents less than 0.1% of net assets.
+ Non-income producing security.
++ Security exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers.
</FN>
</TABLE>
---------------------------------------------------------
GLOSSARY OF TERMS
ADR -- American Depositary Receipt
MTN -- Medium Term Note
---------------------------------------------------------
See Notes to Financial Statements.
77
<PAGE>
PORTFOLIO OF INVESTMENTS
TAX-EXEMPT BOND FUND
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
--------- -----
MUNICIPAL BONDS AND NOTES - 101.8%
ALASKA - 1.3%
<S> <C> <C>
$ 1,235,000 Anchorage, Electric Utility,
(MBIA Insured),
6.500% due 12/01/2013 ....... $ 1,371,492
2,000,000 Anchorage, Ice Rink Revenue,
6.375% due 01/01/2020 ....... 1,860,260
-------------
3,231,752
-------------
ARIZONA - 2.2%
Salt River Project Agricultural
Improvement & Power District:
3,000,000 Series A,
5.750% due 01/01/2009 ....... 3,119,100
1,500,000 Series C,
6.250% due 01/01/2019 ....... 1,518,795
740,000 Tucson, Airport Authority Inc.,
Supplemental Facilities Revenue,
AMT,
8.700% due 09/01/2019 ....... 763,103
-------------
5,400,998
-------------
CALIFORNIA - 6.2%
15,000,000 Anaheim, Public Financing
Authority Lease, Capital
Appreciation Subordinate
Public Improvements, Project-C,
(FSA Insured),
Zero coupon due 09/01/2034 .... 1,861,200
5,860,000 California Educational Facilities
Authority Revenue, Loyola
Marymount, (MBIA Insured),
Zero coupon due 10/01/2020 .... 1,648,184
2,000,000 Center Unified School District
California, Capital Appreciation,
Series C, GO, (MBIA Insured),
Zero coupon due 09/01/2018 .... 689,040
Foothill/Eastern Corridor Agency,
California Toll Road Revenue:
2,000,000 (MBIA Insured),
Zero coupon due 01/15/2018 .... 692,840
1,490,000 5.800% due 01/15/2020 ......... 788,150
3,500,000 Lodi, Electric System Revenue, COP,
Series B, (MBIA Insured),
Zero coupon due 01/15/2024 .... 799,400
550,000 Los Angeles, Regional Airport
Improvement, Series A, AMT,
6.700% due 01/01/2022 ......... 558,943
2,700,000 Orange County Recovery, COP,
Series A, (MBIA Insured),
6.000% due 07/01/2026 ......... 2,730,132
1,173,000 Sacramento, Centrex System Lease,
COP, Series A,
5.550% due 09/15/2004 ......... 1,146,983
1,000,000 Sacramento, City Financing
Authority Revenue, Convention
Center Hotel, Series A,
6.250% due 01/01/2030 ......... 920,610
2,500,000 San Diego, Convention Center
Expansion Financing Authority
Revenue, Series A,
4.750% due 04/01/2028 ......... 2,076,950
PRINCIPAL
AMOUNT VALUE
--------- -----
$ 7,000,000 San Joaquin Hills, California
Transportation Corridor, Agency
Toll Road Revenue,
Series A, (MBIA Insured),
Zero coupon due 01/15/2034 .... $ 912,730
-------------
14,825,162
-------------
COLORADO - 4.7%
Denver City and County, Airport
Revenue, AMT:
1,045,000 Series A, Pre-refunded,
8.500% due 11/15/2023 ....... 1,082,683
Series A, Unrefunded:
1,470,000 8.875% due 11/15/2012 ....... 1,572,062
1,835,000 8.000% due 11/15/2025 ....... 1,896,289
1,920,000 Series C,
6.600% due 11/15/2004 ....... 1,998,874
4,500,000 Meridian Metropolitan District,
GO,
7.500% due 12/01/2011 ....... 4,678,740
-------------
11,228,648
-------------
CONNECTICUT - 1.1%
1,500,000 Connecticut State Special
Obligation Parking Revenue,
Bradley International Airport,
Series A, AMT,
6.600% due 07/01/2024 ....... 1,494,435
995,000 Mashantucket Western Pequot Tribe,
Special Revenue, Series A,
Pre-refunded,
6.500% due 09/01/2005 ....... 1,064,849
-------------
2,559,284
-------------
DISTRICT OF COLUMBIA - 1.1%
630,000 District of Columbia, COP,
6.875% due 01/01/2003 ....... 639,129
500,000 District of Columbia, Water
& Sewer Authority, (FSA Insured),
5.500% due 10/01/2017 ....... 493,635
1,500,000 Metropolitan District, Washington
D.C., Airport Authority,
General Airport Revenue,
Series A, AMT, (MBIA Insured),
6.625% due 10/01/2019 ....... 1,556,715
-------------
2,689,479
-------------
FLORIDA - 5.7%
22,520,000 Dade County, Guaranteed Entitlement
Revenue, Capital Appreciation,
Series A, (MBIA Insured),
Zero coupon due 02/01/2018 .. 7,656,124
1,000,000 Florida Board of Education,
Series A, (FGIC Insured),
4.500% due 06/01/2023 ....... 806,850
5,000,000 Orlando Utilities Commission
Water & Electric,
6.000% due 10/01/2010 ....... 5,324,750
-------------
13,787,724
-------------
</TABLE>
See Notes to Financial Statements.
78
<PAGE>
PORTFOLIO OF INVESTMENTS (CONTINUED)
TAX-EXEMPT BOND FUND
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
--------- -----
MUNICIPAL BONDS AND NOTES (CONTINUED)
GEORGIA - 6.2%
<S> <C> <C>
$ 1,000,000 Atlanta, Airport Facilities Revenue,
AMT,
7.250% due 01/01/2017 ....... $ 1,038,460
2,000,000 Georgia Municipal Electric
Authority Power, Series Z, (MBIA
Insured), 5.500% due 01/01/2020 1,963,300
5,000,000 Georgia State, GO, Series B,
6.300% due 03/01/2009 ....... 5,409,400
Monroe, PCR, (Oglethorpe Power
Company):
2,500,000 6.700% due 01/01/2009 ....... 2,692,900
3,410,000 6.750% due 01/01/2010 ....... 3,714,138
-------------
14,818,198
-------------
HAWAII - 0.9%
Honolulu City & County, GO,
Series A:
730,000 Pre-refunded,
6.000% due 01/01/2012 ....... 774,326
1,270,000 Unrefunded,
6.000% due 01/01/2012 ....... 1,333,563
-------------
2,107,889
-------------
IDAHO - 0.9%
2,000,000 Idaho Health Facilities Authority
Revenue, (Inverse Floater), ETM,
6.650% due 02/15/2021+ ...... 2,199,780
-------------
ILLINOIS - 15.4%
Bolingbrook, Capital Appreciation,
(MBIA Insured):
4,000,000 Series B,
Zero coupon due 01/01/2030 .. 618,600
4,915,000 Series C,
Zero coupon due 01/01/2025 .. 1,073,927
10,000,000 Chicago, Board of Education, School
Reform, Series A, (FGIC Insured),
Zero coupon due 12/01/2031 .. 1,413,900
3,665,000 Chicago, Gas Supply Revenue,
(Peoples Gas),
6.875% due 03/01/2015 ....... 3,838,831
Chicago, O'Hare International Airport
Supplemental Facilities, AMT:
700,000 American Air Lines, Special Series A,
7.875% due 11/01/2025 ....... 717,857
6,000,000 International Terminal (MBIA Insured),
6.750% due 01/01/2012 ....... 6,237,720
United Air Lines:
615,000 8.400% due 05/01/2004 ....... 628,524
725,000 8.950% due 05/01/2018 ....... 755,269
Cook County, School District,
Number 026, ETM, (MBIA Insured):
1,445,000 Zero coupon due 12/01/2003 .. 1,197,905
1,020,000 Zero coupon due 12/01/2004 .. 800,771
Illinois Health Facilities Authority
Revenue:
240,000 Glenoak Medical Center, Series D,
Pre-refunded,
9.500% due 11/15/2015 ....... 251,530
PRINCIPAL
AMOUNT VALUE
--------- -----
$ 4,340,000 Hindsdale Hospital, Series B, ETM,
9.000% due 11/15/2015 ....... $ 4,536,906
3,000,000 Rush Presbyterian - St. Luke's
Medical Center, Residual Interest
Bond, (MBIA Insured),
9.057% due 10/01/2024+ ...... 3,292,500
5,000,000 Sister Services Hospital, Residual
Interest Bond, (MBIA Insured),
Pre-refunded,
9.067% due 06/19/2015+ ...... 5,468,750
Metropolitan Pier and Exposition
Authority, Dedicated State Tax,
(FGIC Insured):
620,000 Pre-refunded,
Zero coupon due 06/15/2008 .. 400,111
Unrefunded:
3,380,000 Zero coupon due 06/15/2008 .. 2,169,216
5,185,000 Zero coupon due 06/15/2009 .. 3,139,777
815,000 ETM,
Zero coupon due 06/15/2009 .. 496,604
-------------
37,038,698
-------------
INDIANA - 2.6%
6,000,000 Indiana Municipal Power Agency,
Series A, (MBIA Insured),
6.125% due 01/01/2013 ....... 6,375,420
-------------
KENTUCKY - 1.7%
1,000,000 Georgetown, College Revenue Bond,
Georgetown College Project,
Series A, (ACA Insured),
6.125% due 11/15/2029 ....... 955,390
Jefferson County, Hospital Revenue,
Residual Interest Bond,
(MBIA Insured):
900,000 Pre-refunded,
7.364% due 10/09/2008+ ...... 986,625
2,100,000 Unrefunded,
7.364% due 10/09/2008+ ...... 2,275,875
-------------
4,217,890
-------------
LOUISIANA - 0.2%
1,500,000 Louisiana Public Facilities
Authority Revenue, Series B, ETM,
Zero coupon due 12/01/2019 .. 467,505
-------------
MARYLAND - 2.5%
5,000,000 Baltimore, Port Facilities Revenue,
Consolidated Coal Sales,
Series B,
6.500% due 10/01/2011 ....... 5,260,800
1,000,000 Maryland, Economic Development
Corporation, Student Housing
Revenue, Collegiate Housing
Towson, Series A,
5.750% due 06/01/2029 ....... 879,560
-------------
6,140,360
-------------
MASSACHUSETTS - 1.2%
1,000,000 Massachusetts, Development Finance
Agency Revenue, (Hillcrest
Educational Centers Inc.),
6.375% due 07/01/2029 ....... 946,870
</TABLE>
See Notes to Financial Statements.
79
<PAGE>
PORTFOLIO OF INVESTMENTS (CONTINUED)
TAX-EXEMPT BOND FUND
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
--------- -----
MUNICIPAL BONDS AND NOTES (CONTINUED)
MASSACHUSETTS (CONTINUED)
<S> <C> <C>
$ 1,900,000 Massachusetts, Health and Education
Facility Authority Revenue,
(Capital Assets), Series D, (MBIA
Insured), 6.050% due 01/01/2035+ $ 1,900,000
------------
2,846,870
------------
MICHIGAN - 1.1%
1,000,000 Michigan State Hospital Finance
Authority Revenue, Detroit Medical
Center, Series A, Pre-refunded,
5.250% due 08/15/2028 ....... 712,630
2,000,000 Michigan State Strategic Fund,
Limited Obligation Revenue,
(Detroit Edison Company),
Series A, AMT, (MBIA Insured),
5.550% due 09/01/2029 ....... 1,849,140
-------------
2,561,770
-------------
MISSISSIPPI - 3.5%
Lowndes County, Solid Waste
Disposal, PCR, (Weyerhauser
Company Project):
4,000,000 Series A,
6.800% due 04/01/2022+ ...... 4,317,040
4,000,000 Series B,
6.700% due 04/01/2022+ ...... 4,231,320
-------------
8,548,360
-------------
MONTANA - 0.4%
1,000,000 Forsyth, PCR, Puget Sound Power &
Light, Series B, AMT, (AMBAC
Insured), 7.250% due 08/01/2021 1,042,990
-------------
NEBRASKA - 3.3%
450,000 Nebraska Investment Finance
Authority, Single Family Housing
Revenue, Residual Interest Bond,
AMT, (GNMA Collateral),
8.857% due 09/15/2024+ ...... 469,687
7,000,000 Omaha Public Power District
Electric, Series B, ETM,
6.150% due 02/01/2012 ....... 7,404,320
-------------
7,874,007
-------------
NEVADA - 2.1%
4,000,000 Clark County, IDR, Nevada Power
Company, Series A, AMT, (FGIC
Insured), 6.700% due 06/01/2022 4,156,240
1,000,000 Clark County, Las Vegas Convention,
GO, Series A,
5.000% due 07/01/2024 ....... 860,080
-------------
5,016,320
-------------
NEW JERSEY - 0.9%
1,400,000 New Jersey Economic Development
Authority Revenue, Educational
Testing Service, Series A, AMT,
(MBIA Insured),
4.750% due 05/15/2025 ....... 1,177,022
PRINCIPAL
AMOUNT VALUE
--------- -----
$ 1,000,000 New Jersey Economic Development
Authority, Special Facilities
Revenue, Continental Airlines
Inc.,
6.250% due 09/15/2029 ....... $ 912,720
-------------
2,089,742
-------------
NEW MEXICO - 1.0%
1,500,000 Lordsburg, PCR, (Phelps Dodge),
6.500% due 04/01/2013 ....... 1,527,645
1,000,000 New Mexico State Hospital,
Equipment Loan Council, Hospital
Revenue, (Memorial Medical
Center, Inc.),
5.500% due 06/01/2028 ....... 785,760
-------------
2,313,405
-------------
NEW YORK - 5.0%
5,500,000 Long Island Power Authority,
Electric System Revenue,
(FSA Insured),
Zero coupon due 06/01/2020 .. 1,681,845
1,265,000 Metropolitan Transportation
Authority, Service Contract
Transportation Facilities,
Series 7,
4.750% due 07/01/2019 ....... 1,049,634
1,000,000 New York, GO, Unrefunded, Series B,
(FSA Insured), ETM,
7.000% due 06/01/2014*** .... 1,036,580
200,000 New York City, GO, Series B,
(FGIC Insured),
6.100% due 10/01/2021 ....... 200,000
1,100,000 New York City Transitional Finance
Authority Revenue, Future Tax
Secured, Series C,
5.000% due 05/01/2029 ....... 940,973
New York State Dormitory Authority
Revenue:
2,000,000 New York University, Series A,
(AMBAC Insured),
5.250% due 07/01/2006## ..... 1,998,380
1,000,000 State University Educational
Facilities, (MBIA Insured),
6.000% due 05/15/2016 ....... 1,036,890
2,000,000 New York State Housing Finance
Agency Revenue, MFHR, Second
Mortgage, Series F, AMT,
(Sonyma Program Insured),
6.625% due 08/15/2012 ....... 2,047,860
2,500,000 North Hempstead, GO, Series A,
(FGIC Insured),
4.750% due 01/15/2023 ....... 2,105,400
-------------
12,097,562
-------------
NORTH DAKOTA - 1.4%
3,370,000 Mercer County, PCR,
(Otter Trail Power),
6.900% due 02/01/2019 ....... 3,469,988
-------------
OHIO - 1.0%
1,240,000 Lorain County, Hospital Revenue,
Humility of Mary Health Care,
Series B, ETM,
7.200% due 12/15/2011 ....... 1,313,854
</TABLE>
See Notes to Financial Statements.
80
<PAGE>
PORTFOLIO OF INVESTMENTS (CONTINUED)
TAX-EXEMPT BOND FUND
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
--------- -----
MUNICIPAL BONDS AND NOTES (CONTINUED)
OHIO (CONTINUED)
<S> <C> <C>
$ 1,000,000 Montgomery County, Hospital
Revenue, (Grandview Hospital
& Medical Center),
5.250% due 12/01/2003 ....... $ 1,005,310
-------------
2,319,164
-------------
OKLAHOMA - 1.0%
1,165,000 Oklahoma Housing and Finance
Authority, Single Family Revenue,
Series B, AMT, (GNMA Collateral),
7.997% due 08/01/2018 ....... 1,230,543
200,000 Tulsa, Municipal Airport Revenue,
(American Airlines Project), AMT,
7.600% due 12/01/2030 ....... 205,158
1,000,000 Tulsa County, Public Facilities
Authority
Capital Improvement Revenue,
6.250% due 11/01/2022 ....... 975,260
-------------
2,410,961
-------------
OREGON - 0.2%
1,000,000 Columbia County, District No. 502,
(FGIC Insured),
Zero coupon due 06/01/2016 .. 401,630
-------------
PENNSYLVANIA - 5.8%
Allegheny County, Hospital
Development Revenue, (Ohio Valley
General Hospital):
700,000 5.100% due 04/01/2001 ....... 697,151
735,000 5.300% due 04/01/2002 ....... 730,362
625,000 5.400% due 04/01/2003 ....... 618,181
500,000 McKean County, Hospital Authority
Revenue, Bradford Hospital,
8.875% due 10/01/2020 ....... 518,250
4,000,000 Pennsylvania Higher Education
Revenue, Assistance Agency,
Student Loan, Residual Interest
Bond, AMT, (AMBAC Insured),
9.074% due 09/01/2026+ ...... 4,630,000
Pennsylvania State Turnpike,
Community Oil Franchise Tax
Revenue, (AMBAC Insured):
2,250,000 Series A,
4.750% due 12/01/2027 ....... 1,850,940
1,750,000 Series B,
4.750% due 12/01/2027 ....... 1,439,620
1,000,000 Philadelphia, Gas Works Revenue,
Second Series, (FSA Insured),
5.000% due 07/01/2029 ....... 852,630
2,500,000 Philadelphia, GO, (FSA Insured),
5.000% due 03/15/2028 ....... 2,140,250
2,775,000 Pittsburgh, Water & Sewer
Authority, Water & Sewer System
Revenue, First Lien, Series B,
(FGIC Insured),
Zero coupon due 09/01/2028 .. 486,735
-------------
13,964,119
-------------
PRINCIPAL
AMOUNT VALUE
--------- -----
SOUTH CAROLINA - 0.8%
$ 1,000,000 Charleston County, Industrial
Revenue, Zeigler Coal Holdings,
6.950% due 08/10/2028 ....... $ 816,320
1,375,000 Lancaster County, School District,
GO, (FSA Insured),
4.750% due 03/01/2019 ....... 1,173,755
-------------
1,990,075
-------------
TENNESSEE - 0.4%
1,000,000 Johnson City, Health & Educational
Facility Board, Hospital Revenue,
First Mortgage Mountain States
Health, Series A,
7.500% due 07/01/2033 ....... 960,650
-------------
TEXAS - 4.5%
415,000 Brazos, Higher Educational
Facilities Authority, Series C-2,
AMT,
7.100% due 11/01/2004 ....... 439,041
5,000,000 Dallas-Fort Worth, International
Airport, (Facility Improvement
Corporate Revenue), (American
Airlines, Inc), AMT,
7.500% due 11/01/2025 ....... 5,100,100
3,500,000 Harris County, COP,
4.500% due 10/01/2023 ....... 2,789,885
1,925,000 Round Rock, Independent School
District, GO, PSF-GTD,
4.500% due 08/01/2019 ....... 1,602,562
319,000 Texas, Higher Education
Coordinating Board, Student
Loan, AMT,
7.700% due 10/01/2025 ....... 328,653
500,000 West Side Calhoun County, Solid
Waste
Revenue Bond, (Union Carbide
Project), AMT,
8.200% due 03/15/2021 ....... 518,890
-------------
10,779,131
-------------
VIRGINIA - 1.6%
1,000,000 Pocahontas Parkway Association,
Virgin Toll Road Revenue,
Series A,
5.000% due 08/15/2005 ....... 960,130
Richmond, GO, (FSA Insured)##:
1,000,000 5.125% due 01/15/2008 ....... 986,560
1,000,000 5.250% due 01/15/2009 ....... 990,730
1,000,000 5.500% due 01/15/2010 ....... 1,004,730
-------------
3,942,150
-------------
WASHINGTON - 10.9%
4,500,000 King County, School District
#415 Kent, GO, Series C,
6.300% due 12/01/2008 ....... 4,802,310
Pierce County, Housing Authority
Revenue:
3,635,000 5.400% due 12/01/2013 ....... 3,364,011
1,900,000 5.900% due 12/01/2028 ....... 1,657,731
950,000 Port Anacortes, Revenue Bond,
Series A,
5.125% due 09/01/2009 ....... 890,482
</TABLE>
See Notes to Financial Statements.
81
<PAGE>
PORTFOLIO OF INVESTMENTS (CONTINUED)
TAX-EXEMPT BOND FUND
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
--------- -----
MUNICIPAL BONDS AND NOTES (CONTINUED)
WASHINGTON (CONTINUED)
<S> <C> <C> <C>
$ 785,000 University of Washington Revenue
Bond, (MBIA Insured), Unrefunded,
7.000% due 12/01/2021 ....... $ 823,677
Washington State Health Care
Facilities Authority, Fred
Hutchinson Cancer Center, (LOC
Morgan Guarantee Trust):
1,750,000 7.200% due 01/01/2007 ....... 1,812,720
1,750,000 7.375% due 01/01/2018 ....... 1,809,553
Washington State, GO:
7,570,000 Series B,
5.000% due 05/01/2017 ....... 6,878,783
3,900,000 Series B & AT-7,
6.400% due 06/01/2017 ....... 4,249,596
-------------
26,288,863
-------------
WEST VIRGINIA - 1.5%
2,500,000 Harrison County, Solid Waste
Disposal, (Monongahela Power),
Series A, AMT,
6.875% due 04/15/2022 ....... 2,618,300
150,000 Kanawha County, IDR, (Union Carbide
Project), Series A, AMT,
8.000% due 08/01/2020 ....... 153,731
750,000 South Charleston, IDR, (Union
Carbide Project), Series A, AMT,
8.000% due 08/01/2020 ....... 768,645
-------------
3,540,676
-------------
WISCONSIN - 1.5%
1,000,000 Madison, IDR, (Madison Gas &
Electric Company), (Project A),
AMT,
6.750% due 04/01/2027 ....... 1,030,570
Wisconsin Health & Educational
Facilities Authority Revenue:
1,500,000 (Kenosha Hospital & Medical
Center),
5.625% due 05/15/2029 ....... 1,272,090
1,000,000 (Waukesha Memorial Hospital),
Series A, (AMBAC Insured),
7.125% due 08/15/2007 ....... 1,027,280
200,000 Wisconsin State Transportation
Revenue, Series A,
5.500% due 07/01/2014 ....... 198,914
-------------
3,528,854
-------------
Total Municipal Bonds and Notes
(Cost $238,448,921) ......... 245,076,074
-------------
TOTAL INVESTMENTS (Cost $238,448,921*) 101.8% 245,076,074
OTHER ASSETS AND LIABILITIES (NET) ... (1.8) (4,437,210)
----- -------------
NET ASSETS ........................... 100.0% $ 240,638,864
===== =============
</TABLE>
Tax-Exempt Bond Fund had the following industry concentrations greater than 10%
at April 30, 2000 (as a percentage of net assets):
Retail Utility 14.9%
General Purpose 17.4%
Health Care 12.6%
Tax-Exempt Bond Fund had the following insurance concentrations greater than 10%
at April 30, 2000 (as a percentage of net assets):
MBIA 22.9%
<TABLE>
<CAPTION>
NUMBER OF UNREALIZED
CONTRACTS VALUE APPRECIATION
--------- ----- ------------
FUTURES CONTRACTS - LONG POSITION
<S> <C> <C>
40 Municipal Bond,
June 2000 .......... $3,728,750 $ 70,336
30 U.S. Long Bond,
June 2000 .......... 2,896,875 35,270
---------- ---------
Net Unrealized Appreciation of
Futures Contracts Long Position ... $105,606
========
=======================
<FN>
*Aggregate cost for federal tax purposes.
** Security pledged as collateral for when-issued securities.
*** Security pledged as collateral for futures contracts.
# Amount represents less than 0.1% of net assets.
## Security purchased on when-issued basis (Note 2).
+ Floating rate note. The interest rate shown reflects the rate currently
in effect.
</FN>
</TABLE>
-------------------------------------------------------------------
GLOSSARY OF TERMS
ACA -- American Capital Access
AMBAC -- American Municipal Bond Assurance Corporation
AMT -- Alternative Minimum Tax
COP -- Certificates of Participation
ETM -- Escrowed to Maturity
FGIC -- Federal Guaranty Insurance Corporation
FSA -- Financial Security Assurance
GNMA -- Government National Mortgage Association
GO -- General Obligation Bonds
IDR -- Industrial Development Revenue
LOC -- Letter of Credit
MBIA -- Municipal Bond Investors Assurance
MFHR -- Multi-family Housing Revenue
PCR -- Pollution Control Revenue
PSF-GTD -- Permanent School Fund Guaranteed
-------------------------------------------------------------------
See Notes to Financial Statements.
82
<PAGE>
PORTFOLIO OF INVESTMENTS
CALIFORNIA MUNICIPAL FUND
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
--------- -----
MUNICIPAL BONDS AND NOTES - 99.2%
CALIFORNIA - 95.9%
<S> <C> <C>
Abag, Financing Authority for
Nonprofit Corporation, COP:
$ 1,100,000 (Episcopal, Homes Foundation),
5.000% due 07/01/2007 ........ $ 1,047,926
(O'Connor Woods Obligated Group):
1,000,000 5.400% due 11/01/2009 ........ 998,160
2,530,000 5.700% due 11/01/2013 ........ 2,513,757
2,000,000 6.200% due 11/01/2029 ........ 1,979,940
5,360,000 Alhambra, Improvement Board Act of
1915, Assessment District No. 1,
Public Works, (MBIA Insured),
6.125% due 09/02/2018 ........ 5,465,699
2,550,000 Alta Loma, School District, Capital
Appreciation, Series A,
(FGIC Insured),
Zero coupon due 08/01/2022 ... 673,021
2,000,000 Anaheim, Public Financing Authority
Revenue, Residual Interest Bond,
(MBIA Insured),
8.520% due 12/28/2018 ........ 2,247,500
1,460,000 Antioch, Public Financing Authority,
Reassessment Revenue, Series A,
(AMBAC Insured),
5.000% due 09/02/2018 ........ 1,325,227
2,000,000 Barstow Redevelopment Agency,
Central Redevelopment, Tax
Allocation, Series A,
(MBIA Insured),
7.000% due 09/01/2014 ........ 2,350,520
1,000,000 Brawley, Wastewater Treatment
Facility, (AMBAC Insured),
5.000% due 07/01/2016 ........ 943,230
4,000,000 California Community College
Financing Authority Lease Revenue,
Series A, (MBIA Insured),
4.625% due 10/01/2019 ........ 3,412,720
California Educational Facilities
Authority Revenue:
2,715,000 (College of Osteopathic Medicine),
(Pre-refunded to 06/01/2003),
7.500% due 06/01/2018 ........ 2,926,987
3,485,000 (Heald College),
5.450% due 02/15/2022 ........ 2,972,078
(Loyola Marymount), (MBIA Insured):
4,435,000 Zero coupon due 10/01/2028 ... 731,731
3,435,000 Zero coupon due 10/01/2030 ... 497,594
2,000,000 (Pooled College and University),
Series B,
5.125% due 04/01/2017 ........ 1,735,840
10,000,000 California Health Facilities,
Financing Authority Revenue
(Cedars-Sinai Medical Center),
6.125% due 12/01/2030 ........ 9,703,900
California Housing Finance Agency,
Home Mortgage, AMT:
500,000 (Multi-family Housing II),
Series C,
6.875% due 08/01/2024 ........ 515,030
PRINCIPAL
AMOUNT VALUE
--------- -----
California Housing Finance Agency,
Home Mortgage, AMT (continued):
(Multi-family Housing III):
Series B, (FHA/VA Insured):
$ 1,000,000 6.000% due 08/01/2016 ........ $ 1,016,220
2,000,000 6.100% due 02/01/2028 ........ 2,007,840
17,500,000 Series F, (FSA Insured),
Zero coupon due 08/01/2031 ... 2,288,125
2,000,000 California Housing Finance Agency,
Home Mortgage Revenue, Series A,
(MBIA Insured),
Zero coupon due 02/01/2016 ... 809,860
California Housing Finance Agency,
Home Ownership & Improvement
Revenue:
370,000 Series B, AMT, (MBIA Insured),
5.200% due 08/01/2026 ........ 370,873
5,010,000 Series C, AMT, (FHA Insured),
6.650% due 08/01/2014 ........ 5,088,557
665,000 Series D, AMT, (MBIA Insured),
6.300% due 08/01/2014 ........ 675,899
5,000,000 Series D, AMT,
Zero coupon due 02/01/2019 ... 1,525,400
2,630,000 Series F, AMT, (MBIA Insured),
6.800% due 08/01/2014 ........ 2,715,712
1,060,000 Series F1, AMT, (AMBAC Insured),
6.500% due 02/01/2008 ........ 1,088,079
California, Pollution Control
Financing Authority, PCR:
2,500,000 (San Diego Gas and Electric),
Series A, AMT, (AMBAC Insured),
5.850% due 06/01/2021 ........ 2,478,325
(Southern California Edison
Company):
4,570,000 Series B, (MBIA Insured),
5.450% due 09/01/2029 ........ 4,329,984
13,250,000 Series B, AMT, (AMBAC Insured),
6.400% due 12/01/2024 ........ 13,521,227
5,000,000 Series B, AMT, (FGIC Insured),
6.400% due 12/01/2024** ...... 5,102,350
5,000,000 (Waste Management), Series A, AMT,
7.150% due 02/01/2011 ........ 5,016,950
3,100,000 (Waste Removal Systems), Series A,
AMT, LOC Wells Fargo & Company,
7.100% due 11/01/2009 ........ 3,166,216
2,250,000 California Residential Efficiency
Financing Authority, (First
Resource Efficiency),
(AMBAC Insured),
6.000% due 07/01/2017 ........ 2,302,717
1,030,000 California Rural Home Mortgage
Finance Authority, SFMR,
Mortgage-Backed Securities,
Series A-2, AMT, (GNMA Collateral),
7.950% due 12/01/2024 ........ 1,091,676
California State, GO:
1,500,000 4.000% due 04/01/2008 ........ 1,382,865
2,000,000 (FGIC Insured),
4.500% due 12/01/2021 ........ 1,636,280
</TABLE>
See Notes to Financial Statements.
83
<PAGE>
PORTFOLIO OF INVESTMENTS (CONTINUED)
CALIFORNIA MUNICIPAL FUND
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
--------- -----
MUNICIPAL BONDS AND NOTES (CONTINUED)
CALIFORNIA (CONTINUED)
<S> <C> <C>
$ 3,000,000 California Statewide Communities
Development Authority , COP,
(Cedars-Sinai Medical Center),
(MBIA Insured),
6.500% due 08/01/2012 ......... $ 3,280,650
California Statewide Communities
Development Authority Revenue:
1,000,000 Multi-family, (Housing Equity
Residential), Series B,
5.200% due 12/01/2029 ......... 958,750
3,300,000 Multi-family, (Housing Equity
Residential), Series C,
5.200% due 12/01/2029 ........ 3,154,173
Water & Wastewater, (Pooled
Finance Program), Series A,
(FSA Insured):
1,000,000 5.000% due 10/01/2025 ........ 878,020
2,665,000 5.750% due 10/01/2025 ........ 2,631,554
2,800,000 (Sherman Oaks Project), Series A,
(AMBAC Insured),
5.000% due 08/01/2022 ........ 2,504,040
1,600,000 (United Airlines, Inc.), Series A,
5.700% due 10/01/2033 ........ 1,397,008
6,225,000 Carson, Improvement Board Act 1915,
GO,
7.375% due 09/02/2022 ........ 6,555,049
Castaic Lake, Water Agency, COP,
Water System Improvement,
(AMBAC Insured):
3,000,000 5.125% due 08/01/2030 ........ 2,648,610
10,445,000 Zero coupon due 08/01/2022 ... 2,756,749
4,675,000 Chula Vista, IDR, (San Diego Gas and
Electric), Series A, AMT,
(AMBAC Insured),
6.400% due 12/01/2027 ........ 4,748,397
2,885,000 Chula Vista, Redevelopment Agency,
Tax Allocation Revenue,
8.625% due 09/01/2024 ........ 3,304,883
2,000,000 Coachella, Redevelopment Agency,
Tax Allocation Revenue,
(Project Area No. 3),
5.875% due 12/01/2028 ........ 1,792,160
Contra Costa County, Finance
Authority, Tax Allocation Revenue,
Series A:
590,000 7.000% due 08/01/2009 ........ 625,264
370,000 7.100% due 08/01/2022 ........ 379,457
Culver City, Redevelopment Finance
Authority Revenue, Tax Allocation:
5,000,000 Series A, (FSA Insured),
5.600% due 11/01/2025 ........ 4,864,400
1,500,000 Series B,
6.250% due 11/01/2025 ........ 1,469,115
1,720,000 Davis, Public Facilities Finance
Authority, Mace Ranch Area,
Series A,
6.600% due 09/01/2025 ........ 1,729,202
PRINCIPAL
AMOUNT VALUE
--------- -----
Delano, COP:
$ 1,720,000 Regional Medical Center,
5.250% due 01/01/2018 ........ $ 1,377,170
3,150,000 Series A, (Pre-refunded to
01/01/2003),
9.250% due 01/01/2022 ........ 3,553,987
Duarte, COP, Series A:
1,250,000 5.250% due 04/01/2024 ........ 1,052,275
2,000,000 5.250% due 04/01/2031 ........ 1,630,080
Duarte, Unified School District,
Capital Appreciation, GO,
Series B, (FSA Insured):
1,060,000 Zero coupon due 11/01/2015 ... 441,034
700,000 Zero coupon due 11/01/2016 ... 273,042
1,000,000 Zero coupon due 11/01/2017 ... 365,320
1,200,000 Zero coupon due 11/01/2018 ... 409,440
700,000 Zero coupon due 11/01/2020 ... 208,859
1,200,000 Zero coupon due 11/01/2024 ... 276,816
1,985,000 El Cajon, COP, (Helix View Nursing
Hospital), Limited Obligation, Series 1990,
AMT, (FHA Insured),
7.750% due 02/01/2029 ........ 1,997,267
2,215,000 El Monte, COP, (AMBAC Insured),
4.750% due 06/01/2030 ........ 1,822,059
Escondido, Unified High School
District, Capital Appreciation,
(MBIA Insured):
5,850,000 Zero coupon due 11/01/2019 ... 1,865,565
3,715,000 Zero coupon due 05/01/2020 ... 1,141,620
3,655,000 Zero coupon due 11/01/2020 ... 1,090,542
4,535,000 Fairfield, Housing Authority
Mortgage Revenue, (Creekside
Estates Project),
(Pre-refunded to 08/01/2002),
7.875% due 02/01/2015 ........ 4,926,371
2,215,000 Fairfield, Housing Authority
Revenue, (Creekside Estates
Mobile Homes),
5.625% due 09/01/2023 ........ 1,959,433
Foothill Eastern Transportation
Corridor Agency, Toll Road
Revenue:
5,000,000 5.750% due 01/15/2040 ........ 4,616,400
3,000,000 5.800% due 01/15/2020 ........ 1,586,880
9,000,000 5.875% due 01/15/2026 ........ 4,634,550
10,000,000 Zero coupon due 01/15/2032 ... 1,269,500
10,000,000 Zero coupon due 01/15/2033 ... 1,185,800
10,000,000 Zero coupon due 01/15/2034 ... 1,111,000
10,000,000 Zero coupon due 01/15/2036 ... 970,200
10,000,000 Zero coupon due 01/15/2037 ... 906,200
10,000,000 Zero coupon due 01/15/2038 ... 846,700
5,000,000 Series A,
7.000% due 01/01/2008 ........ 4,115,550
Golden West Schools Financing
Authority, (School District
Refinancing Program), Series A,
(MBIA Insured):
1,740,000 Zero coupon due 02/01/2011 ... 980,316
1,215,000 Zero coupon due 08/01/2016 ... 476,948
1,580,000 Zero coupon due 02/01/2017 ... 594,965
</TABLE>
See Notes to Financial Statements.
84
<PAGE>
PORTFOLIO OF INVESTMENTS (CONTINUED)
CALIFORNIA MUNICIPAL FUND
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
--------- -----
MUNICIPAL BONDS AND NOTES (CONTINUED)
CALIFORNIA (CONTINUED)
<S> <C> <C>
Hi Desert, Members Health Care,
District Revenue Bonds:
$ 1,250,000 5.500% due 10/01/2015 ........ $ 1,099,400
1,175,000 5.500% due 10/01/2019 ........ 1,002,592
2,000,000 Huntington Park, Public Financing
Authority Lease Revenue, (Waste
Water System Project),
6.200% due 10/01/2025 ........ 1,925,000
1,500,000 Inglewood, Redevelopment Agency,
Tax Allocation, (Merged
Redevelopment), Series A,
(AMBAC Insured),
5.250% due 05/01/2023 ........ 1,395,015
2,000,000 Irvine, Meadows Mobile Home Park
Revenue, Series A,
(GNMA Collateral),
5.700% due 03/01/2018 ........ 1,770,620
1,270,000 Irvine, Public Facilities &
Infrastructure Authority,
Assessment Revenue, Series A,
(AMBAC Insured),
4.050% due 09/02/2008 ........ 1,178,344
3,200,000 Irvine Ranch, Water District
Revenue, District Nos. 140-105-250,
GO,
5.900% due 04/01/2033++ ...... 3,200,000
1,175,000 Kings County, Waste Management
Authority, Solid Waste Revenue,
AMT,
7.200% due 10/01/2014 ........ 1,249,601
3,625,000 La Habra, COP, Park and Viewpark,
Series A, (FSA Insured),
4.800% due 09/01/2022 ........ 3,083,353
1,500,000 La Verne, Public Financing Authority,
Capital Improvement,
7.250% due 09/01/2026 ........ 1,575,315
2,000,000 Lake Elsinore, Public Financing
Authority, Local Agency Revenue,
Series G,
5.800% due 09/02/2015 ........ 1,857,260
2,000,000 Long Beach, Special Tax, Community
Facilities District No. 5, (Towne
Center),
6.875% due 10/01/2025## ...... 2,004,660
Los Angeles, Community Redevelopment
Agency, AMT:
1,425,000 5.850% due 12/01/2026 ........ 1,295,069
1,490,000 Series C, (AMBAC Insured),
6.750% due 07/01/2014 ........ 1,563,219
240,000 Los Angeles, Home Mortgage Revenue,
Mortgage-Backed Security Project,
(GNMA Collateral),
8.100% due 05/01/2017 ........ 239,383
650,000 Los Angeles, SFHR, Series B,
(GNMA Collateral),
7.600% due 08/01/2016 ........ 662,682
3,250,000 Los Angeles, Unified School District,
GO, Series B,
5.000% due 07/01/2023 ........ 2,869,750
1,000,000 Los Angeles County, Master Refunding
Project, COP, (Inverse Floater),
(Pre-refunded to 05/01/2001),
9.076% due 06/01/2015 ........ 1,082,360
PRINCIPAL
AMOUNT VALUE
--------- -----
Los Angeles County, MFHR, AMT,
(GNMA Collateral):
$ 3,000,000 (Park Parthenia Project),
7.400% due 01/20/2022 ........ $ 3,052,050
1,000,000 (Ridgecroft Apartment Project),
Series E,
6.250% due 09/20/2039 ........ 992,670
3,000,000 Los Angeles County, Metropolitan
Transportation Authority, Sales Tax
Revenue, First Tier Properties,
Series C,
5.000% due 07/01/2023 ........ 2,649,000
Los Angeles County, Residual Interest
Bond, COP:
2,740,000 (Edmund D. Edelman Children's
Center), (AMBAC Insured),
6.000% due 04/01/2012 ........ 2,831,023
3,720,000 (Pension Obligation),
(MBIA Insured),
6.900% due 06/30/2008 ........ 4,198,913
Los Angeles County, School
Regionalized Business Service, COP,
Series A, (AMBAC Insured):
1,910,000 Zero coupon due 08/01/2015 ... 803,633
1,945,000 Zero coupon due 08/01/2016 ... 767,127
1,980,000 Zero coupon due 08/01/2017 ... 731,353
2,135,000 Zero coupon due 08/01/2021 ... 601,963
2,180,000 Zero coupon due 08/01/2022 ... 575,367
315,000 Los Angeles County, SFMR, Program
1990, Issue A, AMT, (GNMA
Collateral),
7.550% due 12/01/2023 ........ 321,105
15,000,000 Metropolitan Water District, Southern
California Waterworks Revenue,
Series A,
4.750% due 07/01/2022 ........ 12,659,400
Midpeninsula, Financing Authority
Revenue, Regional Open Space
District, Second Issue,
(AMBAC Insured):
3,905,000 Zero coupon due 08/01/2028 ... 647,488
4,055,000 Zero coupon due 09/01/2028 ... 685,376
4,100,000 Zero coupon due 08/01/2029 ... 637,222
1,000,000 Monterey County, COP, (Natividad
Medical Center Improvement Project),
Series E,
(MBIA Insured),
4.750% due 08/01/2017 ........ 883,880
2,785,000 Needles, Public Utilities Authority
Revenue, (Utilities System
Acquisition Project), Series A,
6.500% due 02/01/2022 ........ 2,672,152
3,500,000 Novato, Special Tax Revenue,
(Community Facilities District),
7.200% due 08/01/2015 ........ 3,696,630
2,000,000 Oakland, Revenue Bonds,
(YMCA East Bay Project),
7.100% due 06/01/2010 ........ 2,093,480
Oakland, Unified School District:
2,645,000 7.000% due 11/15/2011 ........ 2,951,635
3,445,000 COP, Energy Retrofit,
6.750% due 11/15/2014 ........ 3,839,108
</TABLE>
See Notes to Financial Statements.
85
<PAGE>
PORTFOLIO OF INVESTMENTS (CONTINUED)
CALIFORNIA MUNICIPAL FUND
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
--------- -----
MUNICIPAL BONDS AND NOTES (CONTINUED)
CALIFORNIA (CONTINUED)
<S> <C> <C>
$ 4,500,000 Palm Desert, Financing Authority,
Tax Allocation Revenue, (Inverse
Floater), (MBIA Insured),
8.305% due 04/01/2022+ ........ $4,691,250
1,150,000 Palm Springs, Financing Authority,
(Convention Center Project), Series A,
(MBIA Insured),
6.750% due 11/01/2021 ......... 1,204,395
9,145,000 Pittsburgh, Redevelopment Agency Tax
Allocation, Los Medanos Community
Development Project,
(AMBAC Insured),
Zero coupon due 08/01/2029 .... 1,556,388
Port Oakland, AMT, (Mitsu Osk Lines
Ltd.), Series A, LOC Industrial
Bank of Japan Ltd.:
3,030,000 6.750% due 01/01/2012 ......... 3,151,624
2,300,000 6.800% due 01/01/2019 ......... 2,316,261
2,750,000 Redding, Electrical Systems Revenue,
COP, (Inverse Floater),
(MBIA Insured),
8.396% due 07/08/2022+ ........ 3,135,000
1,000,000 Redondo Beach, Public Financing
Authority Revenue, (South Bay
Center Redevelopment Project),
7.125% due 07/01/2026 ......... 1,048,580
Richmond, Power Financing Authority
Term Lease Revenue:
1,180,000 4.450% due 06/01/2007 ......... 1,118,416
1,000,000 4.550% due 06/01/2008 ......... 945,640
1,500,000 Riverside, School District, Special
Project,
7.250% due 09/01/2018 ......... 1,612,920
Riverside County, Public Financing
Authority Revenue, COP:
1,500,000 5.750% due 05/15/2019 ......... 1,353,825
2,100,000 5.800% due 05/15/2029 ......... 1,844,934
Rocklin, Unified School District,
(FGIC Insured):
1,030,000 Zero coupon due 08/01/2014 .... 462,501
1,210,000 Zero coupon due 08/01/2016 .... 474,986
1,255,000 Zero coupon due 08/01/2017 .... 461,225
1,360,000 Zero coupon due 08/01/2019 .... 436,016
1,415,000 Zero coupon due 08/01/2020 .... 424,274
1,225,000 Zero coupon due 08/01/2023 .... 301,803
Rohnert Park, Community Development
Agency, Tax Allocation Revenue,
Capital Appreciation, (Rohnert
Redevelopment), (MBIA Insured):
1,745,000 Zero coupon due 08/01/2021 .... 490,991
1,755,000 Zero coupon due 08/01/2023 .... 434,327
1,755,000 Zero coupon due 08/01/2025 .... 383,292
1,755,000 Zero coupon due 08/01/2027 .... 339,259
1,755,000 Zero coupon due 08/01/2029 .... 299,526
3,240,000 Sacramento County, Airport System
Revenue, Series 1989, AMT,
(Unrefunded Balance),
(AMBAC Insured),
7.000% due 07/01/2020 ......... 3,310,664
PRINCIPAL
AMOUNT VALUE
--------- -----
$ 2,000,000 Sacramento County, COP, Public
Facilities Project, (AMBAC Insured),
4.750% due 10/01/2027 ......... $1,660,460
2,300,000 Saddleback Valley, Unified School
District, Public Financing Authority,
Special Tax
Revenue, Series A, (FSA Insured),
4.750% due 09/01/2020 ......... 1,977,908
995,000 Salinas, California Improvement Board,
Act 1915, Special Assessment
District #90-1, Series C-185,
5.400% due 09/02/2012 ......... 947,787
San Bernardino, Redevelopment Agency
Tax Allocation, San Sevaine
Redevelopment Project, Series A:
1,000,000 6.900% due 09/01/2018 ......... 1,017,100
2,000,000 7.100% due 09/01/2029 ......... 2,035,420
San Bernardino County, COP,
(MBIA Insured):
1,500,000 Joint Powers, Financing Authority,
(Police Station),
5.500% due 09/01/2024 ......... 1,442,520
10,000,000 Residual Interest Bond,
5.750% due 07/01/2016 ......... 10,325,000
San Diego, Redevelopment Agency:
1,000,000 Centre City Redevelopment Project,
Series A,
6.400% due 09/01/2019 ......... 1,007,510
1,155,000 Southcrest Redevelopment Project,
6.500% due 10/01/2025## ....... 1,155,381
4,465,000 San Diego, Unified School District,
GO, Series A, (FGIC Insured),
Zero coupon due 07/01/2018 ... 1,553,240
San Diego County, COP:
1,600,000 5.700% due 02/01/2028 ......... 1,415,584
2,000,000 (Burnham Institute),
6.250% due 09/01/2029 ........ 1,930,840
4,000,000 San Diego County, Residual Interest Bond,
COP, Series B, (MBIA Insured),
(Pre-refunded to 04/27/2006),
8.220% due 04/08/2021++ ...... 4,690,000
1,000,000 San Dimas, Housing Authority Revenue,
(Charter Oak Mobile Home Project),
Series A, (FNMA Collateral),
5.700% due 07/01/2028 ........ 868,300
San Francisco City and County,
International Airport Commission
Revenue, Second Series:
770,000 Issue 24A, AMT, (FSA Insured),
4.750% due 05/01/2006 ........ 763,848
2,040,000 Issue 25, AMT, (FSA Insured),
4.750% due 05/01/2006 ........ 2,023,700
San Francisco City and County, MFMR,
Series A, (FNMA Collateral):
1,000,000 6.350% due 02/15/2012 ........ 1,009,800
1,250,000 6.450% due 02/15/2024 ........ 1,260,638
</TABLE>
See Notes to Financial Statements.
86
<PAGE>
PORTFOLIO OF INVESTMENTS (CONTINUED)
CALIFORNIA MUNICIPAL FUND
APRIL 30, 2000 (UNAUDITED)
PRINCIPAL
AMOUNT VALUE
--------- -----
<TABLE>
<CAPTION>
MUNICIPAL BONDS AND NOTES (CONTINUED)
CALIFORNIA (CONTINUED)
<S> <C> <C>
San Francisco City and County,
Redevelopment Agency, Lease
Revenue, Capital Appreciation,
(George R. Moscon Project):
$ 2,000,000 Zero coupon due 07/01/2011 ..... $ 1,073,640
3,000,000 Zero coupon due 07/01/2013 .... 1,407,960
235,000 San Francisco City and County,
SFMR, AMT, GNMA and FNMA
Mortgage-Backed Securities Program,
7.450% due 01/01/2024 ......... 239,667
1,000,000 San Jose, Redevelopment Agency,
Tax Allocation, Merged Area
Redevelopment, (AMBAC Insured),
4.750% due 08/01/2023 ......... 842,600
San Juan, Unified School District,
GO, (FSA Insured):
1,825,000 Zero coupon due 08/01/2020 .... 543,996
1,000,000 Zero coupon due 08/01/2021 .... 278,480
1,820,000 Zero coupon due 08/01/2022 .... 474,165
3,000,000 San Leandro, COP, Library & Fire
Stations Financing,(AMBAC Insured),
5.700% due 11/01/2020 ......... 2,995,290
2,000,000 San Macros, Public Facilities
Authority Revenue,
5.800% due 09/01/2018 ......... 1,822,540
3,000,000 Santa Clarita, Community Development
Authority,
7.500% due 11/15/2012 ......... 3,141,450
4,765,000 Santa Rosa, Mortgage Revenue,
(Channate Lodge), (FHA Insured),
6.700% due 12/01/2024 ......... 4,886,841
2,495,000 Simi Valley, Community Development
Agency, Commonwealth Mortgage
Revenue, Sycamore Plaza II,
6.000% due 09/01/2012 ......... 2,534,820
Southern California, Housing Finance
Agency, SFMR, GNMA and FNMA
Mortgage-Backed Securities Program,
(GNMA Collateral):
555,000 Series 1988A, AMT,
8.125% due 02/01/2021 ......... 563,103
890,000 Series A,
7.350% due 09/01/2024 ......... 912,241
140,000 Series B,
6.900% due 10/01/2024 ......... 143,371
1,305,000 Stockton, Community Facilities
Supplemental Tax #90-1,
(Mello Roos-Weston Ranch), Series A,
6.000% due 09/01/2018 1,249,668
45,000 Stockton, Community Facilities
Supplemental Tax #90-2, SFMR,
GNMA Mortgage-Backed Securities
Program, (Brookside Estates), AMT,
7.450% due 08/01/2010 ......... 44,707
PRINCIPAL
AMOUNT VALUE
--------- -----
$ 5,350,000 Vallejo, Parity Revenue, (Water
Improvement), Series A,
(FSA Insured),
5.250% due 05/01/2029 ......... $ 4,880,003
2,025,000 Vallejo, Public Financing Authority
Revenue, (Fairgrounds Drive
Assessment District),
5.700% due 09/02/2011 ......... 1,979,093
-------------
369,260,351
-------------
GUAM - 1.0%
2,000,000 Guam Airport Authority Revenue,
Series B, AMT,
6.700% due 10/01/2023 ......... 2,024,900
2,000,000 Guam Power Authority Revenue,
Series A,
5.125% due 10/01/2029 ......... 1,649,100
-------------
3,674,000
-------------
PUERTO RICO - 0.5%
1,117,325 Centro de Recaudaciones de Ingresos
Municipales, COP,
6.850% due 10/17/2003 ......... 1,138,744
750,000 Puerto Rico, Electric Power Authority
Revenue, Series U,
6.000% due 07/01/2014 ......... 767,963
-------------
1,906,707
-------------
VIRGIN ISLANDS - 1.8%
1,000,000 Virgin Islands, Public Finance
Authority Revenue, Senior Liens,
1998 Ser C,
5.500% due 10/01/2005 ......... 1,000,650
Virgin Islands, Public Finance
Authority Revenue, Gross Receipts,
Taxes Loan Note, Series A:
1,000,000 5.625% due 10/01/2010 ......... 986,400
2,000,000 6.375% due 10/01/2019 ......... 2,004,700
3,000,000 6.125% due 10/01/2029 ......... 2,975,580
-----------
6,967,330
-----------
Total Municipal Bonds and Notes
(Cost $382,623,091) ........... 381,808,388
-----------
SHORT-TERM MUNICIPAL BONDS - 0.9%
California, Pollution Control
Financing Authority, PCR:
(Southern California Edison
Company):
200,000 Series A,
6.150% due 02/28/2008 ......... 200,000
100,000 Series B,
6.150% due 02/28/2008 ......... 100,000
100,000 M-S-R Public Power Agency, California,
Modesto, Santa Clara, Readjusting
Sub-Lien, Series F,
5.750% due 07/01/2022 ......... 100,000
3,100,000 Orange County, Sanitation Districts
1-3, 5-7, & 11, COP,
5.900% due 08/01/2015+ ........ 3,100,000
-----------
Total Short-Term Municipal Bonds
(Cost $3,500,000) ............. 3,500,000
-----------
</TABLE>
See Notes to Financial Statements.
87
<PAGE>
PORTFOLIO OF INVESTMENTS (CONTINUED)
CALIFORNIA MUNICIPAL FUND
APRIL 30, 2000 (UNAUDITED)
VALUE
-----
<TABLE>
<S> <C> <C>
TOTAL INVESTMENTS (Cost $386,123,091*) 100.1% $385,308,388
OTHER ASSETS AND LIABILITIES (NET) ... (0.1) (370,356)
----- ------------
NET ASSETS ........................... 100.0% $384,938,032
===== ============
=======================
<FN>
* Aggregate cost for federal tax purposes.
** Security pledged as collateral for futures contract.
*** Security pledged as collateral for when-issued securities.
+ Variable rate demand notes are payable upon not more than one business day's
notice. The interest rate shown reflects the rate currently in effect.
++ Variable rate security. The interest rate shown reflects the rate currently
in effect.
# Amount represents less than 0.1% of net assets.
## Security purchased on when-issued basis (Note 2).
</FN>
</TABLE>
California Municipal Fund had the following industry concentrations greater than
10% at April 30, 2000 (as a percentage of net assets):
Tax District 14.2%
California Municipal Fund had the following insurance concentrations greater
than 10% at April 30, 2000 (as a percentage of net assets):
MBIA 17.5%
AMBAC 15.3%
<TABLE>
<CAPTION>
NUMBER OF UNREALIZED
CONTRACTS VALUE APPRECIATION
--------- ----- ------------
FUTURES CONTRACTS - LONG POSITION
<S> <C> <C> <C>
240 Municipal Bond,
June 2000 .......... $22,372,500 $284,933
=========== ========
</TABLE>
----------------------------------------------------------------------
GLOSSARY OF TERMS
ACA -- American Capital Access
AMBAC -- American Municipal Bond Assurance Corporation
AMT -- Alternative Minimum Tax
COP -- Certificates of Participation
FGIC -- Federal Guaranty Insurance Corporation
FNMA -- Federal National Mortgage Association
FSA -- Financial Security Assurance
GNMA -- Government National Mortgage Association
GO -- General Obligation Bonds
IDR -- Industrial Development Revenue
LOC -- Letter of Credit
MBIA -- Municipal Bond Investors Assurance
MFHR -- Multi-family Housing Revenue
MFMR -- Multi-family Mortgage Revenue
PCR -- Pollution Control Revenue
SFHR -- Single Family Housing Revenue
SFMR -- Single Family Mortgage Revenue
VA -- Veterans' Administration
---------------------------------------------------------------------
See Notes to Financial Statements.
88
<PAGE>
PORTFOLIO OF INVESTMENTS
CALIFORNIA INSURED INTERMEDIATE MUNICIPAL FUND
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
--------- -----
MUNICIPAL BONDS AND NOTES - 95.2%
CALIFORNIA - 94.3%
<S> <C> <C>
$ 1,000,000 Abag Financing Authority for Nonprofit
Corporation, COP, (Episcopal Homes
Foundation),
6.250% due 08/15/2030 ........ $ 1,020,890
Alameda County:
1,000,000 COP, (Santa Rita Jail Project),
(MBIA Insured),
5.375% due 06/01/2009 ........ 1,031,130
1,000,000 Public Financing Authority Revenue,
5.000% due 09/02/2008 ........ 941,600
435,000 Calexico, Financing Authority Revenue,
Water Systems & Transportation
Improvement Projects,
(AMBAC Insured),
3.950% due 11/01/2007 ........ 403,215
500,000 California Educational Facilities,
Financing Authority Revenue,
University of San Diego,
(AMBAC Insured),
Zero coupon due 10/01/2009 ... 307,500
1,000,000 California Health Facilities,
Financing Authority Revenue,
(Catholic Health Corporation),
Series A, (AMBAC Insured),
5.875% due 07/01/2009 ........ 1,047,530
California Housing Finance Agency
Revenue:
1,825,000 Home Mortgage, Series B1, AMT,
(AMBAC Insured),
6.200% due 02/01/2007 ........ 1,847,484
Home Mortgage, Series L, AMT,
(MBIA Insured):
330,000 5.000% due 08/01/2008 ........ 329,092
500,000 5.100% due 02/01/2009 ........ 500,240
Home Mortgage, Series N, AMT,
(MBIA Insured):
1,000,000 5.000% due 08/01/2008 ........ 1,003,950
1,000,000 5.100% due 02/01/2009 ........ 1,000,480
445,000 Series E, (MBIA Insured),
6.050% due 08/01/2006 ........ 450,487
450,000 SFMR, Series D1,
4.750% due 08/01/2009 ........ 445,981
1,000,000 California State, GO, (FGIC Insured),
6.200% due 09/01/2005 ........ 1,068,060
1,000,000 California State, Public Works Board
Lease Revenue, (Department of
Corrections, State Prisons),
Series A, (AMBAC Insured),
5.250% due 12/01/2013 ........ 1,004,290
1,600,000 California Statewide Communities
Development Authority, Children's
Hospital of Los Angeles, COP,
(MBIA Insured),
6.000% due 06/01/2007 ........ 1,695,936
1,000,000 Castaic Lake, Water Agency, COP,
(Water Systems Improvement Project),
Series A, (MBIA Insured),
5.600% due 08/01/2005 ........ 1,040,430
PRINCIPAL
AMOUNT VALUE
--------- -----
Central Valley, School Districts
Financing Authority, Capital
Appreciation, School District, GO,
Series A, (MBIA Insured):
$ 1,385,000 Zero coupon due 02/01/2005 ..... $ 1,095,715
1,940,000 Zero coupon due 08/01/2008 ... 1,272,213
850,000 Corona, Public Financing Authority,
Superior Lien, Series A,
(FSA Insured),
4.375% due 09/01/2009 ........ 804,304
Foothill Eastern Transportation
Corridor Agency, Toll Road Revenue:
1,000,000 Capital Appreciation, Sr. Lien
Series A,
Zero coupon due 01/01/2004 ... 837,470
1,600,000 (MBIA Insured),
4.375% due 01/15/2007 ........ 1,553,664
Fresno, Unified School District, GO,
Series C, (MBIA Insured):
1,265,000 5.800% due 02/01/2012 ........ 1,343,278
1,375,000 5.800% due 02/01/2013 ........ 1,459,686
685,000 Golden West Schools, Financing
Authority, Series A, (MBIA Insured),
5.650% due 02/01/2012 ........ 715,914
Hanford, Joint Union High School
District, Capital Appreciation,
Series B, (MBIA Insured):
595,000 Zero coupon due 08/01/2007 ... 415,024
675,000 Zero coupon due 08/01/2008 ... 444,434
745,000 Zero coupon due 08/01/2012 ... 387,922
745,000 Zero coupon due 08/01/2013 ... 365,445
755,000 Zero coupon due 08/01/2014 ... 348,553
1,000,000 Inland Empire Solid Waste Financing
Authority Revenue, (Landfill
Improvement Financing Project),
Series B, AMT, (FSA Insured),
6.000% due 02/01/2006 ........ 1,052,220
1,000,000 Irvine, Public Facilities and
Infrastructure Authority Assessment
Revenue, Series A, (AMBAC Insured),
4.150% due 09/02/2009 ........ 926,720
855,000 Los Angeles, Community Redevelopment
Agency, MFHR, (AMBAC Insured),
6.000% due 07/01/2004 ........ 872,912
1,250,000 Los Angeles County, Capital Asset
Leasing Corporation, Leasehold
Revenue, (AMBAC Insured),
6.000% due 12/01/2006 ........ 1,324,788
Los Angeles County, Schools
Regionalized Business Services,
Capital Appreciation, COP, Series A,
(AMBAC Insured):
1,670,000 Zero coupon due 08/01/2008 ... 1,093,382
1,980,000 Zero coupon due 08/01/2012 ... 1,017,542
453,000 Modesto, Mortgage Revenue Bonds,
(GNMA Collateral),
5.875% due 12/01/2004 ........ 461,113
</TABLE>
See Notes to Financial Statements.
89
<PAGE>
PORTFOLIO OF INVESTMENTS (CONTINUED)
CALIFORNIA INSURED INTERMEDIATE MUNICIPAL FUND
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
--------- -----
MUNICIPAL BONDS AND NOTES (CONTINUED)
CALIFORNIA (CONTINUED)
<S> <C> <C>
$ 250,000 Oakland, Improvement Board Act of
1915, Medical Hill Parking,
Assessment District #3,
(MBIA Insured),
6.000% due 09/02/2004 ......... $ 258,773
Paramount, Redevelopment Agency
Tax Allocation, (Redevelopment
Project Area #1), (MBIA Insured):
1,610,000 6.100% due 08/01/2006 ......... 1,699,886
1,700,000 6.100% due 08/01/2007 ......... 1,794,911
1,155,000 Redondo Beach, Public Financing
Authority Revenue, (South Bay Center
Redevelopment Project),
6.750% due 07/01/2006 ......... 1,195,298
1,300,000 Sacramento, Municipal Utility District,
Electric Revenue, (AMBAC Insured),
5.500% due 05/15/2007 ......... 1,337,102
940,000 San Bernardino, Unified City School
District, Capital Appreciation,
Series B, (FGIC Insured),
Zero coupon due 08/01/2008 .... 616,433
San Diego, Unified School District,
Capital Appreciation, Series A,
(FGIC Insured):
2,000,000 Zero coupon due 07/01/2008 .... 1,317,160
1,500,000 Zero coupon due 07/01/2011 .... 827,430
San Francisco City & County, Airport
Community International Airport
Revenue:
2,485,000 Second Series - Issue 18A, AMT,
(MBIA Insured),
6.000% due 05/01/2006 ......... 2,619,836
Second Series - Issue 22, AMT,
(AMBAC Insured):
1,705,000 6.000% due 05/01/2006 ......... 1,797,513
1,000,000 6.000% due 05/01/2008 ......... 1,061,600
690,000 Second Series - Issue 23A, AMT,
(FGIC Insured),
5.500% due 05/01/2005 ......... 710,500
1,000,000 San Joaquin Hills, California,
Transportation Corridor Agency, Toll
Road Revenue, Jr. Lien Revenue Board,
Zero coupon due 01/01/2009 .... 641,420
1,050,000 Santa Ana, COP, (Santa Ana Recycling
Project), Series A, AMT,
(AMBAC Insured),
5.400% due 05/01/2007 ......... 1,072,397
650,000 Santa Clara, Redevelopment Agency,
Tax Allocation, (Bay Shore North
Project), (AMBAC Insured),
7.000% due 07/01/2010 ......... 736,860
1,350,000 Solano County, COP, (Solano Park
Hospital Project), (FSA Insured),
6.500% due 08/01/2006 ......... 1,449,158
PRINCIPAL
AMOUNT VALUE
--------- -----
$ 995,000 Southern California, Home Financing
Authority, MFHR, (The Fountains
Project), Series A, AMT,
(AMBAC Insured), (FNMA Collateral),
5.400% due 01/01/2027 ......... $ 991,617
995,000 Stanton, MFHR, (Continental Gardens
Apartments), (AMBAC Insured),
(FNMA Collateral),
5.625% due 08/01/2029** ....... 998,104
1,305,000 Stockton, Community Facilities
Supplemental Tax, (Mello Roos-Weston
Ranch), Series A,
5.500% due 09/01/2009 ......... 1,277,412
230,000 Tehachapi, COP, Installment Sale,
(FSA Insured),
5.500% due 11/01/2011 ......... 237,227
1,000,000 Tracy, California Area Public
Facilities Financing Agency, Special
Tax Bonds, Community Facilities
District No 1987-1, 1996 h,
(MBIA Insured),
5.875% due 10/01/2013 ......... 1,038,960
1,070,000 University of California, Series A,
(CONNIE LEE Insured),
5.500% due 09/01/2006 ......... 1,092,962
1,000,000 Valley Health Systems, California
Hospital Revenue, (Hospital Revenue
Refunding & Improvement Project),
Series A, (ACA Insured),
6.125% due 05/15/2005 ......... 1,020,220
-----------
58,723,373
-----------
PUERTO RICO - 0.9%
558,663 Centro de Recaudaciones de Ingresos
Municipales, COP,
6.850% due 10/17/2003 ......... 569,372
-----------
Total Municipal Bonds and Notes
(Cost $58,943,111) ............ 59,292,745
-----------
SHORT-TERM MUNICIPAL BONDS - 3.5%
500,000 California Statewide Communities
Development Authority, (John Muir/
Mt. Diablo Health Center),
(AMBAC Insured),
5.950% due 08/15/2027+ ........ 500,000
600,000 M-S-R, Public Power Agency, San Juan
Project Revenue, (MBIA Insured),
5.750% due 07/01/2022+ ........ 600,000
1,100,000 Orange County Sanitation Districts,
1-3, 5-7 & 11, COP,
5.900% due 08/01/2016+ ........ 1,100,000
-----------
Total Short-Term Municipal Bonds
(Cost $2,200,000) ............. 2,200,000
-----------
</TABLE>
See Notes to Financial Statements.
90
<PAGE>
PORTFOLIO OF INVESTMENTS (CONTINUED)
CALIFORNIA INSURED INTERMEDIATE MUNICIPAL FUND
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
VALUE
-----
<S> <C> <C>
TOTAL INVESTMENTS (Cost $61,143,111*) 98.7% $61,492,745
OTHER ASSETS AND LIABILITIES (NET) .. 1.3 798,882
----- -----------
NET ASSETS .......................... 100.0% $62,291,627
===== ===========
========================
<FN>
* Aggregate cost for federal tax purposes.
** Security pledged as collateral for futures contract.
+ Variable rate demand notes are payable upon not more than one business day's
notice. The interest rate shown reflects the rate currently in effect.
</FN>
<CAPTION>
California Insured Intermediate Municipal Fund had the following industry
concentrations greater than 10% at April 30, 2000 (as a percentage of net
assets):
Public Education 20.4%
California Insured Intermediate Municipal Fund had the following insurance
concentrations greater than 10% at April 30, 2000 (as a percentage of net
assets):
MBIA 39.3%
AMBAC 29.4%
<CAPTION>
NUMBER OF UNREALIZED
CONTRACTS VALUE APPRECIATION
--------- ----- ------------
FUTURES CONTRACTS - LONG POSITION
<S> <C> <C> <C>
39 Municipal Bond,
June 2000 ...... $3,635,531 $56,185
========== =======
</TABLE>
---------------------------------------------------------------------
GLOSSARY OF TERMS
ACA -- American Capital Access
AMBAC -- American Municipal Bond Assurance Corporation
AMT -- Alternative Minimum Tax
CONNIE LEE -- College Construction Loan Association
COP -- Certificates of Participation
FGIC -- Federal Guaranty Insurance Corporation
FNMA -- Federal National Mortgage Association
FSA -- Financial Security Assurance
GNMA -- Government National Mortgage Association
GO -- General Obligation Bonds
MBIA -- Municipal Bond Investors Assurance
MFHR -- Multi-family Housing Revenue
---------------------------------------------------------------------
See Notes to Financial Statements.
91
<PAGE>
PORTFOLIO OF INVESTMENTS
FLORIDA INSURED MUNICIPAL FUND
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
-------- -----
MUNICIPAL BONDS AND NOTES - 97.3%
FLORIDA - 97.3%
<S> <C> <C>
$ 250,000 Bay County,Water Systems Revenue,
(AMBAC Insured),
5.700% due 09/01/2030 ....... $ 245,205
500,000 Brevard County, School Board
Authority, COP, Series B,
(AMBAC Insured),
5.500% due 07/01/2021 ....... 482,095
650,000 Broward County, Educational
Facilities Authority Revenue,
(Nova Southeastern University
Project), (CONNIE LEE Insured),
6.000% due 04/01/2008 ....... 674,349
450,000 Collier County, Industrial
Development Authority, IDR,
(Southern States Utilities
Project), AMT,
6.500% due 10/01/2025 ....... 427,963
750,000 Dade County, Aviation Revenue,
Series B, AMT (MBIA Insured),
6.600% due 10/01/2022 ....... 779,977
850,000 Escambia County, Florida Utilities
Authority, Utility Systems Revenue,
5.250% due 01/01/2029 ....... 770,159
400,000 Escambia County, Health Facilities
Revenue, Baptist Hospital,
Series B,
6.000% due 10/01/2014 ....... 360,652
500,000 Escambia County, PCR, (Champion
International Corporation Project),
AMT,
6.900% due 08/01/2022 ....... 508,800
Florida Housing Finance Agency, AMT:
690,000 SFMR, Series A, (AMBAC Insured),
(GNMA Collateral),
6.650% due 01/01/2024 ....... 715,061
1,000,000 Spinnaker Cove Apartments,
Series G, (AMBAC Insured),
6.500% due 07/01/2036 ....... 1,023,400
1,000,000 Florida State Board of Education,
Lottery Revenue Bonds, Series A,
(FGIC Insured),
5.250% due 07/01/2017 ....... 954,720
1,100,000 Florida State Board of Regional
University System Improvement
Revenue, (AMBAC Insured),
4.500% due 07/01/2023 ....... 888,316
Florida State Turnpike Authority,
Turnpike Revenue, Department of
Transportation, Series A,
(FGIC Insured):
1,000,000 5.000% due 07/01/2016 ....... 940,180
600,000 4.500% due 07/01/2028 ....... 474,768
500,000 Gulf Breeze, Capital Funding Revenue,
Series B, (MBIA Insured),
4.500% due 10/01/2027 ....... 396,920
PRINCIPAL
AMOUNT VALUE
--------- -----
$ 1,245,000 Hillsborough County, Capital
Improvement Revenue, Criminal
Justice Facilities,
(FGIC Insured),
5.250% due 08/01/2016 ....... $ 1,186,647
900,000 Jacksonville, Water & Sewer Revenue,
(United Water Project), AMT,
(AMBAC Insured),
6.350% due 08/01/2025 ....... 926,901
870,000 Manatee County, Housing Finance
Authority, SFMR, Sub. Series 4,
AMT, (AMBAC Insured), (GNMA/FNMA
Collateral),
6.875% due 11/01/2026 ....... 926,350
500,000 Orange County, Housing Finance
Authority, MFHR, (Hands Inc.
Project), Series A,
8.000% due 10/01/2025 ....... 528,235
750,000 Orlando & Orange County, Expressway
Authority, Expressway Revenue,
Jr. Lien, (FSA Insured),
5.950% due 07/01/2023** ..... 752,783
1,000,000 Pasco County, Solid Waste Disposal &
Resource Recovery System, AMT,
(AMBAC Insured),
6.000% due 04/01/2011 ....... 1,046,040
650,000 Seminole County, School Board
Authority, COP, Series A,
(MBIA Insured),
(Pre-refunded to 07/01/2004),
6.125% due 07/01/2014 ....... 687,642
------------
15,697,163
------------
Total Municipal Bonds and Notes
(Cost $15,474,437) .......... 15,697,163
------------
SHORT-TERM MUNICIPAL BONDS - 2.5%
(COST $400,000)
400,000 Pinnellas County, Health Facilities
Authority Revenue, (Pooled
Hospital Loan Program),
5.950% due 12/01/2015+ ...... 400,000
-------------
<S> <C> <C>
TOTAL INVESTMENTS (Cost $15,874,437*) ... 99.8% 16,097,163
OTHER ASSETS AND LIABILITIES (NET) ...... 0.2 31,800
----- ------------
NET ASSETS .............................. 100.0% $16,128,963
===== ===========
=======================
<FN>
* Aggregate cost for federal tax purposes.
** Security pledged as collateral for futures contract.
+ Variable rate security. The interest rate shown reflects the rate currently
in effect.
</FN>
</TABLE>
See Notes to Financial Statements.
92
<PAGE>
PORTFOLIO OF INVESTMENTS (CONTINUED)
FLORIDA INSURED MUNICIPAL FUND
APRIL 30, 2000 (UNAUDITED)
Florida Insured Municipal Fund had the following industry concentrations greater
than 10% at April 30, 2000 (as a percentage of net assets):
Water & Sewage 16.1%
Transportation 15.6%
Public Education 12.9%
Single-Family Housing 10.0%
Florida Insured Municipal Fund had the following insurance concentrations
greater than 10% at April 30, 2000 (as a percentage of net assets):
AMBAC 38.8%
FGIC 22.0%
MBIA 11.6%
<TABLE>
<CAPTION>
NUMBER OF UNREALIZED
CONTRACTS VALUE (DEPRECIATION)
--------- ----- -------------
FUTURES CONTRACTS - LONG POSITION
<S> <C> <C> <C>
6 Municipal Bond,
June 2000 ......... $559,313 $(18,048)
======== =========
</TABLE>
---------------------------------------------------------------------
GLOSSARY OF TERMS
AMBAC -- American Municipal Bond Assurance Corporation
AMT -- Alternative Minimum Tax
CONNIE LEE -- College Construction Loan Association
COP -- Certificates of Participation
FGIC -- Federal Guaranty Insurance Corporation
FNMA -- Federal National Mortgage Association
FSA -- Financial Security Assurance
GNMA -- Government National Mortgage Association
IDR -- Industrial Development Revenue
MBIA -- Municipal Bond Investors Assurance
MFHR -- Multi-family Housing Revenue
PCR -- Pollution Control Revenue
SFMR -- Single Family Mortgage Revenue
---------------------------------------------------------------------
See Notes to Financial Statements.
93
<PAGE>
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
WM GROUP OF FUNDS
1. ORGANIZATION AND BUSINESS
WM Trust I ("Trust I") and WM Trust II ("Trust II") (collectively, the "Trusts")
were organized under the laws of the Commonwealth of Massachusetts on September
19, 1997 and February 22, 1989, respectively, as business entities commonly
known as "Massachusetts business trusts." Trust I and Trust II are each
registered under the Investment Company Act of 1940, as amended ("1940 Act"), as
open-end management investment companies. Trust I and Trust II (with the
exception of the Money Market Funds) consist of 15 funds (each a "Fund",
collectively, the "Funds"). The financial statements for the Money Market Funds
are presented in a separate report.
TRUST I TRUST II
EQUITY FUNDS EQUITY FUNDS
Bond & Stock Fund Growth Fund
Growth & Income Fund Small Cap Stock Fund
Growth Fund of the Northwest (formerly, Emerging Growth Fund)
(formerly, Northwest Fund) International Growth Fund
Mid Cap Stock Fund
FIXED INCOME FUNDS FIXED INCOME FUNDS
U.S. Government Securities Fund Short Term Income Fund
Income Fund (formerly, Short Term High Quality
High Yield Fund Bond Fund)
MUNICIPAL FUNDS
MUNICIPAL FUND California Municipal Fund
Tax-Exempt Bond Fund California Insured Intermediate
Municipal Fund
Florida Insured Municipal Fund
MONEY MARKET FUNDS
Money Market Fund MONEY MARKET FUND
Tax-Exempt Money Market Fund California Money Fund
WM Advisors, Inc. (the "Advisor" or "WM Advisors"), a wholly-owned subsidiary
of Washington Mutual, Inc. ("Washington Mutual"), a publicly owned financial
services company, serves as investment advisor to the Trusts.
Each of the Fixed Income Funds and the Equity Funds, with the exception of the
Bond & Stock Fund, offers three classes of shares: Class A shares, Class B
shares and Class I shares. Each of the Municipal Funds, as well as the Bond &
Stock Fund, currently offer Class A and Class B shares. Class A shares of the
Funds are subject to an initial sales charge at the time of purchase. Certain
Class A shares purchased without an initial sales charge may be subject to a
contingent deferred sales charge ("CDSC") if redeemed within two years of
purchase. Class B shares are not subject to an initial sales charge although
they are generally subject to a CDSC if redeemed within five years of purchase.
Class I shares are sold exclusively to the various investment portfolios of the
WM Strategic Asset Management Portfolios, LLC, an open-end management investment
company, and are not available for direct purchase by investors. Class I shares
are not subject to an initial sales charge or CDSC.
2. SIGNIFICANT ACCOUNTING POLICIES
The preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts and disclosures in the financial statements. Actual
results could differ from those estimates. The following is a summary of
significant accounting policies consistently followed by the Funds in the
preparation of their financial statements.
94
<PAGE>
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
WM GROUP OF FUNDS
PORTFOLIO VALUATION:
A security that is primarily traded on a U.S. exchange (including securities
traded through the Nasdaq National Market System) is valued at the last sale
price on that exchange or, if there were no sales during the day, at the mean of
the current day's bid and asked prices. Securities traded only on over-the-
counter markets (other than the Nasdaq National Market System and U.S.
Government Securities) are valued at the over-the-counter bid prices or, if no
sale occurred on such day, at the mean of the current bid and asked prices. An
option is generally valued at the last sale price or, in the absence of a last
sale price, at the mean of the current day's bid and asked prices. Short term
debt securities that mature in 60 days or less are valued at amortized cost. The
value of a foreign security is determined in its national currency as of the
close of trading on the foreign exchange on which it is traded or as of 4:00
p.m. Eastern time, if that is earlier, and that value is then converted into its
U.S. dollar equivalent at the foreign exchange rate in effect at noon, Eastern
time, on the day the value of the foreign security is determined. The value of a
futures contract equals the unrealized gain or loss on the contract, which is
determined by marking the contract to the current settlement price for a like
contract acquired on the day on which the futures contract is being valued.
Debt securities of U.S. issuers (other than U.S. Government securities and
short-term investments), including municipal securities, are valued by one or
more independent pricing services (each a "Pricing Service") retained by the
Trusts. When, in the judgment of a Pricing Service, market quotations for these
securities are readily available, they are valued at the mean between the quoted
bid prices and asked prices. Securities for which market quotations are not
readily available are valued at fair value as determined by or under the
direction of the Board of Trustees, which may rely on the assistance of one or
more Pricing Services. The procedures of each Pricing Service are reviewed
periodically by the officers of the Trusts under the general supervision and
responsibility of the Board of Trustees.
REPURCHASE AGREEMENTS:
Each Fund may engage in repurchase agreement transactions. A repurchase
agreement is a purchase of an underlying debt obligation subject to an agreement
by the seller to repurchase the obligation at an agreed upon price and time. The
value of the collateral is at all times at least equal to the total amount of
the repurchase obligation. In the event of counterparty default, the Fund would
seek to use the collateral to offset losses incurred. There is potential loss in
the event the Fund is delayed or prevented from exercising its right to dispose
of the collateral securities, including the risk of a possible decline in the
value of the underlying securities during the period while the Fund seeks to
assert its rights. WM Advisors, acting under the supervision of the Board of
Trustees, reviews the value of the collateral and the creditworthiness of those
banks and dealers with whom each Fund enters into repurchase agreements.
REVERSE REPURCHASE AGREEMENTS:
The Short Term Income, California Municipal, California Insured Intermediate
Municipal, Florida Insured Municipal, Growth, International Growth, Mid Cap
Stock and Small Cap Stock Funds may engage in reverse repurchase agreements.
Reverse repurchase agreements are the same as repurchase agreements except that,
in this instance, the Funds would assume the role of seller/borrower in the
transaction. The Funds may use reverse repurchase agreements to borrow
short-term funds. The value of the reverse repurchase agreements that the Funds
have committed to sell is reflected in the Funds' Statements of Assets and
Liabilities. The Funds will segregate with the Trusts' custodian liquid assets
that at all times are in an amount equal to their obligations under reverse
repurchase agreements. Reverse repurchase agreements involve the risks that the
market value of the securities sold by the Funds may decline below the
repurchase price of the securities and, if the proceeds from the reverse
repurchase agreement are invested in securities, that the market value of the
securities bought may decline below the repurchase price of the securities sold.
OPTION CONTRACTS:
The Equity Funds, Fixed Income Funds and the Municipal Funds may engage in
option contracts. The Funds may use option contracts to manage their exposure to
the stock and bond markets and to fluctuations in interest rates and currency
values. The underlying principal amounts and option values are shown in the
Portfolio of Investments under the captions "Put Options Purchased on Foreign
Currency," "Call Options Written on Foreign Currency" and "Call Options
Purchased on Stock Indices." These amounts reflect each contract's exposure to
the underlying instrument at April 30, 2000. Writing puts and buying calls tends
to increase the Funds' exposure to the underlying instrument. Buying puts and
writing calls tends to decrease the Funds' exposure to the underlying
instruments or to hedge other Fund investments.
95
<PAGE>
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
WM GROUP OF FUNDS
Upon the purchase of a put option or a call option by the Funds, the premium
paid is recorded as an investment, the value of which is marked-to-market daily.
When a purchased option expires, the Funds will realize a loss in the amount of
the cost of the option. When the Funds enter into a closing sale transaction,
the Funds will realize a gain or loss depending on whether the sales proceeds
from the closing sale transaction are greater or less than the cost of the
option. When the Funds exercise a put option, they will realize a gain or loss
from the sale of the underlying security and the proceeds from such sale will be
decreased by the premium originally paid. When the Funds exercise a call option,
the cost of the security purchased will be increased by the premium originally
paid.
When the Funds write a call option or a put option, an amount equal to the
premium received by the Funds is recorded as a liability, the value of which is
marked-to-market daily. When a written option expires, the Funds realize a gain
equal to the amount of the premium received. When the Funds enter into a closing
purchase transaction, the Funds realize a gain (or loss if the cost of the
closing purchase transaction exceeds the premium received when the option was
sold) without regard to any unrealized gain or loss on the underlying security,
and the liability related to such option is eliminated. When a written call
option is exercised, the Funds realize a gain or loss from the sale of the
underlying security and the proceeds from such sale are increased by the premium
originally received. When a written put option is exercised, the amount of the
premium originally received will reduce the cost of the security that the Funds
purchased upon exercise.
The risk associated with purchasing options is limited to the premium originally
paid. Options written by a Fund involve, to varying degrees, risk of loss in
excess of the option value reflected in the Statements of Assets and
Liabilities. The risk in writing a covered call option is that the Funds may
forego the opportunity to profit if the market price of the underlying security
increases and the option is exercised. The risk in writing a covered put option
is that the Funds may incur a loss if the market price of the underlying
security decreases and the option is exercised. In addition, there is the risk
the Funds may not be able to enter into a closing transaction because of an
illiquid secondary market or, for over-the-counter options, because of the
counterparty's inability to perform.
The Equity Funds, Fixed Income Funds and the Municipal Funds may engage in
options on foreign currency and options on interest rate futures. Options on
foreign currency and options on interest rate futures act as a hedge to provide
protection against adverse movements in the value of foreign securities in the
portfolio.
Certain risks are associated with the use of options on foreign currency and
options on interest rate futures contracts as hedging devices. The predominant
risk is that the movement in the price of the instrument underlying such options
may not correlate perfectly with the movement in the prices of the assets being
hedged. The lack of correlation could render the Funds' hedging strategy
unsuccessful and could result in a loss to the Funds. In addition, there is the
risk the Funds may not be able to enter into a closing transaction because of an
illiquid secondary market or, for over-the-counter options, because of the
counterparty's inability to perform. Options written by a Fund involve, to
varying degrees, risk of loss in excess of the option value reflected in the
Statements of Assets and Liabilities.
FUTURES CONTRACTS:
Each Fund may engage in futures transactions. The Funds may use futures
contracts to manage their exposure to the stock and bond markets and to
fluctuations in interest rates and currency values. The underlying value of a
futures contract is incorporated within the unrealized appreciation/
(depreciation) shown in the Portfolio of Investments under the caption "Futures
Contracts." This amount reflects each contract's exposure to the underlying
instrument at April 30, 2000. Buying futures contracts tends to increase the
Fund's exposure to the underlying instrument. Selling futures contracts tends to
either decrease the Fund's exposure to the underlying instrument, or to hedge
other Fund investments.
Upon entering into a futures contract, the Fund is required to deposit with the
broker an amount of cash or cash equivalents equal to a certain percentage of
the contract amount. This is known as the "initial margin." Subsequent payments
("variation margin") are made or received by the Fund each day, depending on the
daily fluctuation of the value of the contract. The daily changes in contract
value are recorded as unrealized gains or losses and the Fund recognizes a
realized gain or loss when the contract is closed.
96
<PAGE>
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
WM GROUP OF FUNDS
There are several risks in connection with the use of futures contracts as a
hedging device. Futures contracts involve, to varying degrees, risk of loss in
excess of the futures variation margin reflected in the Statements of Assets and
Liabilities. The change in the value of futures contracts primarily corresponds
with the value of their underlying instruments, which may not correlate with the
change in the value of the hedged instruments. In addition, there is the risk
that the Fund may not be able to enter into a closing transaction because of an
illiquid secondary market.
FOREIGN CURRENCY:
The books and records of the Funds are maintained in U.S. dollars. Foreign
currencies, investments and other assets and liabilities are translated into
U.S. dollars at the exchange rates prevailing at the end of the period.
Purchases and sales of investment securities, income and expenses are translated
on the respective dates of such transactions. It is not practicable to isolate
that portion of the results of operations arising as a result of changes in the
foreign exchange rates from the portion that arising from changes in market
prices of investments during the period. Accordingly, all such changes have been
reflected as realized and unrealized net gain/(loss) from security transactions
in the Statements of Operations.
Unrealized gains and losses, not relating to securities, which result from
changes in foreign currency exchange rates have been included in unrealized
appreciation/(depreciation) of foreign currency and other assets and
liabilities. Unrealized gains and losses of securities, which result from
changes in foreign currency exchange rates as well as changes in market prices
of securities, have been included in unrealized appreciation/(depreciation) of
securities. Net realized foreign currency gains and losses include foreign
currency gains and losses resulting from changes in exchange rates between trade
date and settlement date on investment securities transactions, gains and losses
on foreign currency transactions and the difference between the amounts of
interest and dividends recorded on the books of the Funds and the amount
actually received. The portion of foreign currency gains and losses related to
fluctuation in exchange rates between the initial purchase trade date and
subsequent sale trade date is included in realized gains/(losses) from security
transactions.
FORWARD FOREIGN CURRENCY CONTRACTS:
The Equity Funds and Fixed Income Funds (with the exception of the Bond & Stock
Fund, Growth & Income Fund, Growth Fund of the Northwest and the U.S. Government
Securities Fund) may enter into forward foreign currency contracts. Forward
foreign currency contracts are agreements to exchange one currency for another
at a future date and at a specified price. These Funds may use forward foreign
currency contracts to facilitate transactions in foreign securities and to
manage the Funds' foreign currency exposure. The U.S. dollar market value,
contract value and the foreign currencies the Funds have committed to buy or
sell are shown in the Portfolio of Investments under the caption "Schedule of
Forward Foreign Currency Contracts." These amounts represent the aggregate
exposure to each foreign currency the Funds have acquired or hedged through
forward foreign currency contracts at April 30, 2000. Forward foreign currency
contracts are reflected as both a forward foreign currency contract to buy and a
forward foreign currency contract to sell.
Forward foreign currency contracts to buy generally are used to acquire exposure
to foreign currencies, while forward foreign currency contracts to sell are used
to hedge the Funds' investments against currency fluctuations. Also, a forward
foreign currency contract to buy or sell can offset a previously acquired
opposite forward foreign currency contract.
Forward foreign currency contracts are marked-to-market daily using foreign
currency exchange rates supplied by an independent pricing service. The change
in a contract's market value is recorded by the Funds as an unrealized gain or
loss. When the contract is closed or delivery is taken, the Funds record a
realized gain or loss equal to the difference between the value of the contract
at the time it was opened and the value at the time it was closed.
The use of forward foreign currency contracts does not eliminate fluctuations in
the underlying prices of the Fund's securities, but it does establish a rate of
exchange that can be achieved in the future. These forward foreign currency
contracts involve market risk in excess of the unrealized appreciation/
(depreciation) of forward foreign currency contracts reflected in the Funds'
Statements of Assets and Liabilities. Although forward foreign currency
contracts used for hedging purposes limit the risk of loss due to a decline in
the value of the hedged currency, they also limit any potential gain that might
result should the value of the currency increase. In addition, the Funds could
be exposed to risks if the counterparties to the contracts are unable to meet
the terms of their contracts. The Fund's Advisor and/or Sub-advisor will enter
into forward foreign currency contracts only with parties approved by the Board
of Trustees because there is a risk of loss to the Funds if the counterparties
do not complete the transaction.
97
<PAGE>
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
WM GROUP OF FUNDS
DOLLAR ROLL TRANSACTIONS:
In order to seek a high level of current income, the Short Term Income Fund, the
U.S. Government Securities Fund and the Income Fund may enter into dollar roll
transactions with financial institutions to take advantage of opportunities in
the mortgage market. The value of the dollar roll transactions are reflected in
the Funds' Statements of Assets and Liabilities. A dollar roll transaction
involves a sale by the Funds of securities that they hold with an agreement by
the Funds to repurchase similar securities at an agreed upon price and date. The
securities repurchased will bear the same interest as those sold, but generally
will be collateralized at time of delivery by different pools of mortgages with
different prepayment histories than those securities sold. The Funds are paid a
fee for entering into a dollar roll transaction, that is accrued as income over
the life of the dollar roll contract. During the period between the sale and
repurchase, the Funds will not be entitled to receive interest and principal
payments on the securities sold. Management anticipates that the proceeds of the
sale will be invested in additional instruments for the Funds, and the income
from these investments, together with any additional fee income received on the
dollar roll transaction will generate income for the Funds exceeding the
interest that would have been earned on the securities sold. Dollar roll
transactions involve the risk that the market value of the securities sold by
the Funds may decline below the repurchase price of those similar securities
which the Fund is obligated to purchase or that the return earned by the Fund
with the proceeds of a dollar roll may not exceed transaction costs.
INDEXED SECURITIES:
Each of the Funds may invest in indexed securities whose value is linked either
directly or inversely to changes in foreign currencies, interest rates,
commodities, inflation, indices, or other reference instruments. Indexed
securities may be more volatile than the reference instrument itself, but any
loss is limited to the amount of the original investment.
ILLIQUID INVESTMENTS:
Up to 15% of the net assets of each Fund may be invested in securities that are
not readily marketable, including: (1) repurchase agreements with maturities
greater than seven calendar days; (2) time deposits maturing in more than seven
calendar days; (3) futures contracts and options to the extent a liquid
secondary market does not exist for the instruments; (4) certain
over-the-counter options; (5) certain variable rate demand notes having a demand
period of more than seven days; and (6) securities, the disposition of which are
restricted under Federal securities laws, excluding certain Rule 144A
securities, as defined below.
Illiquid securities generally cannot be sold or disposed of in the ordinary
course of business (within seven days) at approximately the value at which the
Funds have valued the investments. This may have an adverse effect on the Fund's
ability to dispose of particular illiquid securities at fair market value and
may limit the Fund's ability to obtain accurate market quotations for purposes
of valuing the securities and calculating the net asset value of shares of the
Fund. The Funds may also purchase securities that are not registered under the
Securities Act of 1933, as amended (the "Act"), but that can be sold to
qualified institutional buyers in accordance with Rule 144A under the Act ("Rule
144A Securities"). Rule 144A Securities generally may be resold only to other
qualified institutional buyers. If a particular investment in Rule 144A
Securities is not determined to be liquid under the guidelines established by
the Board of Trustees, that investment will be included within the 15%
limitation, as applicable, on investment in illiquid securities.
SECURITIES TRANSACTIONS AND INVESTMENT INCOME:
Securities transactions are recorded as of the trade date (the date the order to
buy or sell is executed). Realized gains and losses from securities sold are
recorded on the identified cost basis. Interest income is recorded on the
accrual basis and consists of interest accrued and, if applicable, discount
accreted less premiums amortized. Premiums on bonds can be amortized on the
basis of any of the following methods: yield-to-maturity, straight-line, or
yield-to-call. Discounts can be accreted using yield-to-maturity or
straight-line methods. Premiums and discount on mortgage-backed securities are
amortized or accreted using only the straight-line method. Dividend income is
recorded on the ex-dividend date, except certain dividends from foreign
securities are recorded as soon as the Funds are informed of the ex-dividend
date. Each Fund's investment income and realized and unrealized gains and losses
are allocated among the classes of that Fund based upon the relative average net
assets of each class.
Securities purchased or sold on a when-issued or delayed-delivery basis may be
settled a month or more after the trade date; interest income is not accrued
until settlement date. Each Fund instructs the custodian to segregate assets of
the Fund with a current value at least equal to the amount of its when-issued
purchase commitments.
98
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NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
WM GROUP OF FUNDS
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS:
Dividends from net investment income of the Fixed Income Funds and the Municipal
Funds are declared daily and paid monthly. Dividends from the net investment
income of the Bond & Stock and the Growth & Income Funds are declared and paid
quarterly. Dividends from the net investment income of the Growth Fund are
declared and paid semiannually. Dividends from the net investment income of the
Growth Fund of the Northwest, International Growth, Mid Cap Stock and Small Cap
Stock Funds are declared and paid annually. Distributions of any net long-term
capital gains earned by a Fund are made annually. Distributions of any net
short-term capital gains earned by a Fund are distributed no less frequently
than annually at the discretion of the Board of Trustees. Additional
distributions of net investment income and capital gains for each Fund may be
made at the discretion of the Board of Trustees in order to avoid the
application of a 4% non-deductible excise tax on certain undistributed amounts
of ordinary income and capital gains. Income distributions and capital gain
distributions are determined in accordance with income tax regulations which may
differ from generally accepted accounting principles. These differences are
primarily due to differing treatments of income and gains on various investment
securities held by the Funds, organizational costs, dividends payable,
redesignated distributions and differing characterization of distributions made
by each Fund as a whole.
FEDERAL INCOME TAXES:
It is each Fund's policy to qualify as a regulated investment company by
complying with the requirements of the Internal Revenue Code of 1986, as
amended, applicable to regulated investment companies and by, among other
things, distributing substantially all of its taxable earnings to its
shareholders. Therefore, no Federal income tax provision is required.
EXPENSES:
General expenses of the Trusts are allocated to all the Funds based upon
relative net assets of each Fund except printing and postage expenses, which are
allocated to all the Funds based upon the relative number of shareholder
accounts of each Fund. Operating expenses directly attributable to a class of
shares are charged to the operations of that class of shares. Expenses of each
Fund not directly attributable to the operations of any class of shares are
prorated among the classes to which the expenses relate based on the relative
average net assets of each class of shares.
OTHER:
The Fixed Income Funds and the Municipal Funds may purchase floating rate,
inverse floating rate and variable rate obligations, including municipal
securities and participation interests therein. Floating rate obligations have
an interest rate that changes whenever there is a change in the external
interest rate, while variable rate obligations provide for a specified periodic
adjustment in the interest rate. The interest rate on an inverse floating rate
obligation (an "inverse floater") can be expected to move in the opposite
direction from the market rate of interest to which the inverse floater is
indexed. The Fixed Income Funds may also purchase mortgage-backed securities
that are floating rate, inverse floating rate and variable rate obligations.
Although variable rate demand notes are frequently not rated by credit rating
agencies, unrated notes purchased by the Fund will be of comparable quality at
the time of purchase to rated instruments that may be purchased by such Fund, as
determined by the Advisor. The absence of such an active secondary market,
however, could make it difficult for the Fund to dispose of a particular
variable rate demand note in the event the issuer of the note defaulted on its
payment obligations, and the Fund could, for this or other reasons, suffer a
loss to the extent of the default.
An inverse floater may be considered to be leveraged to the extent that its
interest rate varies by a magnitude that exceeds the magnitude of the change in
the index rate of interest. The higher degree of leverage inherent in inverse
floaters is associated with greater volatility in their market values.
Accordingly, the duration of an inverse floater may exceed its stated final
maturity.
3. INVESTMENT ADVISORY AND OTHER TRANSACTIONS
WM Advisors serves as investment advisor to the Trusts. The Advisor is entitled
to a monthly fee based upon a percentage of the average daily net assets of each
Fund at the following rates:
99
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NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
WM GROUP OF FUNDS
FEES ON AVERAGE
NAME OF FUND DAILY NET ASSETS
------------ ---------------
Growth Fund .................................. .850%
Mid Cap Stock Fund ........................... .750%
Small Cap Stock Fund ......................... .850%
U.S. Government Securities Fund .............. .500%
Income Fund .................................. .500%
California Municipal Fund .................... .500%
California Insured Intermediate Municipal Fund .500%
Florida Insured Municipal Fund ............... .500%
FEES ON
NET ASSETS FEES ON
EQUAL TO NET ASSETS
OR LESS THAN EXCEEDING
NAME OF FUND $250 MILLION $250 MILLION
------------ ------------ ------------
Bond & Stock Fund ..................... .625% .500%
Growth & Income Fund .................. .625% .500%
High Yield Fund ....................... .625% .500%
Tax-Exempt Bond Fund .................. .500% .400%
FEES ON
NET ASSETS
FEES ON EXCEEDING
NET ASSETS $200 MILLION
EQUAL TO AND EQUAL TO FEES ON NET ASSETS
OR LESS THAN OR LESS THAN EXCEEDING
NAME OF FUND $200 MILLION $500 MILLION $500 MILLION
------------ ------------ ------------- -------------
Short Term Income Fund .500% .450% .400%
FEES ON NET ASSETS
FEES ON EXCEEDING
NET ASSETS $500 MILLION FEES ON
EQUAL TO AND EQUAL TO NET ASSETS
OR LESS THAN OR LESS THAN EXCEEDING
NAME OF FUND $500 MILLION $1 BILLION $1 BILLION
------------ ------------ ----------- ----------
Growth Fund of the
Northwest ......... .625% .500% .375%
FEES ON NET ASSETS
FEES ON EXCEEDING
NET ASSETS $50 MILLION FEES ON
EQUAL TO AND EQUAL TO NET ASSETS
OR LESS THAN OR LESS THAN EXCEEDING
NAME OF FUND $50 MILLION $125 MILLION $125 MILLION
------------ ----------- ------------ ------------
International Growth Fund 1.100% 1.000% .800%
WM Advisors provides administration services to the Trusts at no additional fee.
100
<PAGE>
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
WM GROUP OF FUNDS
The Advisor has agreed to waive a portion of its management fees and/or
reimburse expenses. Fees waived by the Advisor for the six months ended April
30, 2000 were as follows:
NAME OF FUND FEES WAIVED
------------ -----------
Growth Fund .......................... $328,130
Short Term Income Fund ............... 228,363
U.S. Government Securities Fund ...... 92,489
Income Fund .......................... 16,323
Tax-Exempt Bond Fund ................. 22,383
WM Shareholder Services, Inc. (the "Transfer Agent"), an indirect wholly owned
subsidiary of Washington Mutual serves as the transfer and shareholder servicing
agent of the Funds. Shareholder servicing fees were paid to the Transfer Agent
for services incidental to issuance and transfer of shares, maintaining
shareholder lists, and issuing and mailing distributions and reports. The
authorized monthly shareholder servicing fee is $1.35 for both Class A and Class
B shareholder accounts. Class I shares are not subject to shareholder servicing
fees.
Custodian fees for certain Funds have been reduced by credits allowed by the
custodian for uninvested cash balances. These Funds could have invested this
cash in income producing securities. Fees reduced by credits allowed by the
custodian for the six months ended April 30, 2000 are shown separately in the
Statements of Operations.
4. TRUSTEES' FEES
No director, officer or employee of Washington Mutual or its subsidiaries
receives any compensation from the Trusts for serving as an officer or Trustee
of the Trusts. The Trusts, together with other mutual funds advised by WM
Advisors, Inc., pays each Trustee who is not an officer or employee of
Washington Mutual or its subsidiaries, $18,000 per annum plus $3,000 per board
meeting attended or $1,000 per board meeting attended by telephone. The Lead
Trustee receives an additional $6,000 per annum. Trustees are also reimbursed
for travel and out-of-pocket expenses. The Chairman of each committee receives
an additional $500 per committee meeting attended.
Pursuant to an exemptive order granted by the Securities and Exchange
Commission, the Trusts' eligible Trustees may participate in a deferred
compensation plan (the "Plan") which may be terminated at any time. Under the
Plan, Trustees may elect to defer receipt of all or a portion of their fees
which, in accordance with the Plan, are invested in mutual fund shares. Upon
termination of the Plan, Trustees that have deferred accounts under the Plan
will be paid benefits no later than the time the payments would otherwise have
been made without regard to such termination. All benefits provided under these
Plans are funded and any payments to plan participants are paid solely out of
the Trusts' assets.
5. DISTRIBUTION PLANS
WM Funds Distributor, Inc. (the "Distributor"), a registered broker-dealer and
an indirect wholly owned subsidiary of Washington Mutual, serves as distributor
for Class A and Class B shares. For the six months ended, April 30, 2000, the
Distributor received $3,832,463 representing commissions (front-end sales
charges) on Class A shares and $13,401,370 representing CDSC fees from Class B
shares. For the six months ended April 30, 2000, WM Financial Services, Inc.
("WM Securities"), also a registered broker-dealer, for the Funds, received
$109,905 representing commissions on Class A shares and $148,173 representing
CDSC fees from Class B shares.
Each of the Funds, has adopted two distribution plans, pursuant to Rule 12b-1
under the 1940 Act, applicable to Class A and Class B shares of the Fund (each,
a "Rule 12b-1 Plan"), respectively. There are no 12b-1 Plans applicable to Class
I shares of the Funds. Under the applicable Rule 12b-1 Plans, the Distributor
receives a service fee at an annual rate of 0.25% of the average daily net
assets of both classes. In addition, the Distributor is paid a fee as
compensation in connection with the offering and sale of Class B shares at an
annual rate of 0.75% of the average daily net assets of such shares. These fees
may be used to cover the expenses of the Distributor primarily intended to
result in the sale of such shares, including payments to the Distributor's
representatives or others for selling shares. Because the Distributor may retain
any amount of its fee that is not so
101
<PAGE>
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
WM GROUP OF FUNDS
expended, the Rule 12b-1 Plans are characterized by the SEC as
"compensation-type" plans. The service fee is paid by the Fund to the
Distributor, which in turn, pays a portion of the service fee to broker/dealers
that provide services, such as accepting telephone inquiries and transaction
requests and processing correspondences, new account applications and subsequent
purchases by check for the shareholders. Under their terms, both the Class A
Plan and the Class B Plan shall remain in effect from year to year, provided
such continuance is approved annually by vote of the Board of Trustees,
including a majority of those Trustees who are not "interested persons" of the
Trust, as defined in the 1940 Act, and who have no direct or indirect financial
interest in the operation of such distribution plans, or any agreements related
to such plans, respectively.
6. PURCHASES AND SALES OF SECURITIES
The aggregate cost of purchases and proceeds from sales of securities, excluding
U.S. Government and short-term investments, for the six months ended April 30,
2000 were as follows:
NAME OF FUND PURCHASES SALES
------------ --------- -----
Bond & Stock Fund ............. $ 64,422,368 $116,260,006
Growth & Income Fund .......... 290,865,423 279,142,034
Growth Fund of the Northwest .. 199,105,706 134,380,128
Growth Fund ................... 635,601,033 612,042,229
Mid Cap Stock Fund ............ 111,555,758 --
Small Cap Stock Fund .......... 149,264,224 58,792,415
International Growth Fund ..... 41,457,548 75,164,965
Short Term Income Fund ........ 5,994,824 30,044,784
U.S. Government Securities Fund -- 2,859,924
Income Fund ................... 40,403,400 33,349,350
High Yield Fund ............... 107,482,205 24,969,624
Tax-Exempt Bond Fund .......... 28,701,921 64,926,895
California Municipal Fund ..... 115,373,393 147,332,647
California Insured Intermediate
Municipal Fund ............. 16,624,535 22,659,751
Florida Insured Municipal Fund 5,596,358 10,395,607
The aggregate cost of purchases and proceeds from sales of U.S. Government
securities, excluding short-term investments, for the six months ended April 30,
2000, were as follows:
NAME OF FUND PURCHASES SALES
------------ --------- -----
Growth & Income Fund .......... $ 10,110,744 $ --
Short Term Income Fund ........ -- 19,298,509
U.S. Government Securities Fund 19,194,238 44,078,591
Income Fund ................... 107,615,624 10,213,141
102
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NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
WM GROUP OF FUNDS
At April 30, 2000, aggregate gross unrealized appreciation for all securities in
which there is an excess of value over tax cost and aggregate gross unrealized
depreciation for all securities in which there is an excess of tax cost over
value were as follows:
TAX BASIS TAX BASIS
UNREALIZED UNREALIZED
NAME OF FUND APPRECIATION DEPRECIATION
------------ ------------ -------------
Bond & Stock Fund .............. $ 44,743,036 $ 17,800,189
Growth & Income Fund ........... 469,830,274 109,496,435
Growth Fund of the Northwest ... 236,644,030 28,008,935
Growth Fund .................... 418,542,114 52,655,558
Mid Cap Stock Fund ............. 16,307,960 3,730,218
Small Cap Stock Fund ........... 76,308,246 41,337,906
International Growth Fund ...... 56,720,150 11,399,330
Short Term Income Fund ......... 11,932 3,477,074
U.S. Government Securities Fund 1,820,455 17,908,398
Income Fund .................... 6,234,743 12,999,618
High Yield Fund ................ 6,790,361 7,702,465
Tax-Exempt Bond Fund ........... 10,395,937 3,768,784
California Municipal Fund ...... 10,962,363 11,777,066
California Insured Intermediate
Municipal Fund ............... 1,019,621 669,987
Florida Insured Municipal Fund . 387,941 165,215
7. LENDING OF PORTFOLIO SECURITIES
Certain Funds may lend securities to brokers, dealers and other financial
organizations. Each security loan is collateralized with collateral assets in an
amount equal to the current market value of the loaned securities. There is a
risk of delay in receiving collateral or in recovering the securities loaned or
even a loss of rights in collateral should the borrower fail financially.
At April 30, 2000, the Funds had outstanding loans of securities to certain
brokers, dealers or other financial institutions for which each Fund has
segregated cash equivalent to 100% of the market value of securities loaned with
the Funds' custodian. At April 30, 2000, the following Funds had securities on
loan:
MARKET VALUE
OF LOANED MARKET VALUE
NAME OF FUND SECURITIES OF COLLATERAL
------------ ---------- -------------
Bond & Stock Fund ............. $ 8,665,539 $ 8,894,809
Growth & Income Fund .......... 17,096,925 17,578,800
Growth Fund of the Northwest Fund 5,438,991 5,630,955
Growth Fund ................... 39,649,643 40,764,755
Small Cap Stock Fund .......... 1,332,700 1,384,300
International Growth Fund ..... 6,755,963 7,103,000
Short Term Income Fund ........ 355,689 359,470
U.S. Government Securities Fund 13,269,301 13,563,250
Income Fund ................... 15,440,965 15,903,699
High Yield Fund ............... 4,422,375 4,547,700
103
<PAGE>
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
WM GROUP OF FUNDS
8. SHARES OF BENEFICIAL INTEREST
The Trusts may issue an unlimited number of shares of beneficial interest, each
without par value.
9. GEOGRAPHIC AND INDUSTRY CONCENTRATION AND RISK FACTORS
There are certain risks arising from the California Municipal and California
Insured Intermediate Municipal Funds' investments in California municipal
securities. The California Municipal and California Insured Intermediate
Municipal Funds' are more susceptible to factors adversely affecting issuers of
California municipal securities than is a municipal bond fund that is not
concentrated in these issuers to the same extent. Uncertain economic conditions
or governmental developments may affect the ability of California municipal
securities issuers to meet their financial obligations.
The Florida Insured Municipal Fund primarily invests in debt obligations issued
by the State of Florida and its political subdivisions, agencies and public
authorities to obtain funds for various public purposes. The Florida Insured
Municipal Fund is more susceptible to factors adversely affecting issuers of
Florida municipal securities than is a municipal bond fund that is not
concentrated in these issuers to the same extent. Uncertain economic conditions
may affect the ability of Florida municipal securities issuers to meet their
financial obligations.
The Equity Funds, Short Term Income Fund, Income Fund and High Yield Fund,
invest in securities of foreign companies and foreign governments. There are
certain risks involved in investing in foreign securities. These risks include
those resulting from future adverse political and economic developments and the
possible imposition of currency exchange restrictions or other foreign laws or
restrictions.
The Growth Fund of the Northwest concentrates its investments in companies
located or doing business in the Northwest region of the United States. The
Growth Fund of the Northwest is not intended as a complete investment program
and could be adversely impacted by economic trends within the region.
Certain Funds may invest a portion of their assets in foreign securities;
developing or emerging markets countries enter into forward foreign currency
transactions; lend their portfolio securities; enter into stock index, interest
rate and currency futures contracts, and options on such contracts; enter into
interest rate swaps or purchase or sell interest rate caps or floors; engage in
other types of options transactions; make short sales; purchase zero coupon and
payment-in-kind bonds; engage in repurchase or reverse repurchase agreements;
purchase and sell "when-issued" securities and engage in "delayed-delivery"
transactions; and engage in various other investment practices each with
inherent risks.
10. CONTRIBUTION IN KIND
Effective as of the close of business on July 16, 1999, the Griffin Portfolio
Builder Accounts (asset allocation accounts that were invested in Class A shares
of certain Funds in the WM Group of Funds) redeemed in kind their investments in
Class A shares of the certain Funds and contributed these assets to the WM
Strategic Asset Management Portfolios (the "Portfolios"). The Portfolios used
these contributed assets to acquire shares in Class I of certain Funds in the WM
Group of Funds.
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