<PAGE>
[GRAPHIC OMITTED]
- ---------------------------------------------
COLONIAL GLOBAL EQUITY FUND SEMIANNUAL REPORT
- ---------------------------------------------
April 30, 1998
------------------------------
Not FDIC May Lose Value
Insured No Bank Guarantee
------------------------------
<PAGE>
COLONIAL GLOBAL EQUITY FUND HIGHLIGHTS
NOVEMBER 1, 1997 - APRIL 30, 1998
INVESTMENT OBJECTIVE: Colonial Global Equity Fund seeks long-term growth by
investing primarily in global equities.
THE FUND IS DESIGNED TO OFFER:
o Opportunities for long-term growth of capital
o International investment exposure
o Global diversification to help reduce risk
o Experienced professional management
PORTFOLIO MANAGER COMMENTARY: "With healthy economic environments in the United
States and Europe, both regions provided a solid foundation for growth
opportunities within a variety of industries over the last six months."
-- Gita Rao & Nicolas Ghajar
COLONIAL GLOBAL EQUITY FUND PERFORMANCE
CLASS A CLASS B CLASS C
Inception date 6/8/92 6/8/92 8/1/97
- ------------------------------------------------------------------------------
Six-month distributions declared per share $1.620 $1.562 $1.589
- ------------------------------------------------------------------------------
Six-month total returns, assuming 21.12% 20.61% 20.80%
reinvestment of all distributions
and no sales charge or contingent
deferred sales charge (CDSC)
- -------------------------------------------------------------------------------
Net asset value per share on 4/30/98 $15.42 $15.24 $15.39
TOP FIVE HOLDINGS TOP FIVE COUNTRIES
(as of 4/30/98) (as of 4/30/98)
......................................... ....................................
1. Lucent Technologies, Inc..... 1.5% 1. United States ......... 26.3%
2. Quorum Health Group, Inc..... 1.2% 2. Japan ................. 9.7%
3. Bass PLC .................... 1.2% 3. United Kingdom ......... 9.6%
4. Safeway, Inc. ............... 1.1% 4. Germany ................ 6.1%
5. Wal-Mart Stores, Inc. ....... 1.0% 5. France ................. 5.5%
Holding and country breakdowns are calculated as a percent of total net assets.
Because the Fund is actively managed, there can be no guarantee the Fund will
continue to hold these securities or invest in these countries in the future.
<PAGE>
PRESIDENT'S MESSAGE
TO FUND SHAREHOLDERS
[Photo of Harold W. Cogger]
I am pleased to present your Fund's semiannual report for the six-month period
ended April 30, 1998.
With its ability to seek the best performing stocks worldwide, Colonial Global
Equity Fund has performed well throughout the last six months. By diversifying
its investments across both U.S. and foreign markets, the Fund was able to take
advantage of a wide array of growth opportunities.
Over the past few years, we've had the pleasure of witnessing one of the
strongest domestic bull markets in history. More recently, it has become
increasingly apparent that a large number of economies and markets throughout
the world continue to offer some very favorable characteristics for long-term
growth investors seeking opportunity beyond U.S. borders.
Particularly in continental Europe, many countries are at an earlier stage in
the growth curve than the U.S. Much of what companies in these markets have
started to accomplish is a result of the "leaner and meaner" approach to running
their operations. The effort to cut costs and increase profitability has
certainly started to pay off. As the local economies within these countries have
also cooperated, the combination of strong, steady earnings growth and
relatively low inflation offer the potential for some positive outcomes in the
months and years to come.
Overall, global investment opportunities in developed economies are as strong
and abundant as they have ever been. We believe it continues to be a rewarding
time for investors who understand the value of exploring growth opportunities
both inside the U.S. and throughout the world.
The following report will provide you with more specific information on your
Fund's performance and the markets in which the Fund has focused its efforts.
Thank you for choosing Colonial Global Equity Fund and for giving us the
opportunity to serve your investment needs.
Respectfully,
/s/ Harold W. Cogger
Harold W. Cogger
President
June 9, 1998
Because market conditions change frequently, there can be no assurance that
the trends described will continue.
<PAGE>
PORTFOLIO MANAGEMENT REPORT
GITA RAO is portfolio manager of Colonial Global Equity Fund and is vice
president of Colonial Management Associates, Inc. NICOLAS GHAJAR is associate
portfolio manager of the Fund. What follows is a discussion of the Fund's
performance for the six months ended April 30, 1998.
GLOBAL DIVERSIFICATION -- A REWARDING EXPERIENCE
The Fund's globally diversified portfolio continued to produce some favorable
results for investors. By spreading the Fund's assets among various countries
around the world, we provided you with access to a much wider variety of
investment opportunities than a pure domestic stock fund. At the same time, it
reduced the risk that the performance of any single market could hurt the Fund's
performance.
During the last six months, we've been able to take full advantage of the strong
growth opportunities in the U.S. and continental Europe. At the end of April,
26% of the portfolio was invested in the U.S. By maintaining a large number of
U.S. stocks in the portfolio, we were able to capture some healthy returns from
a market that continued to reach new highs during the period. At the same time,
a number of European markets in which the Fund invested produced some equally
impressive results. We are gradually decreasing our holdings in the U.S. in
order to take full advantage of the values we believe exist across continental
Europe.
The uncertainty in Asia receded somewhat during the period. However, we
continued to maintain an underweighted position in that region, while keeping a
watchful eye for potential growth opportunities. The real story was the stellar
performance of equity markets in countries such as Finland, France, Italy, Spain
and Portugal over the last six months. Overall, we found investment
opportunities in these countries to be cheaper than in the U.S., while offering
greater growth potential.
THREE FACTORS CONTRIBUTED TO STRONG RESULTS: CONSOLIDATION, RESTRUCTURING AND
EMU
A healthy overall economic environment provided a foundation for solid growth in
Europe during the last six months. In addition, there were three key factors
that contributed to the Fund's strong performance during the period:
consolidation within the financial services sector, corporate restructuring and
the favorable progression of the European Monetary Union (EMU).
While the Fund is diligent about maintaining diversification across a variety of
industries and countries, the financial services sector rewarded investors
during the period. Similar to the events U.S. investors witnessed back in 1990
and 1991, European countries started to see a consolidation trend among banks
and insurance companies. The results of many of these mergers were larger
revenue bases, greater efficiencies and increased profits -- a combination that
helped push the stock prices of many companies in this sector upward.
Corporate restructuring has been another positive step taken by European
companies. Mirroring the example of many successful U.S. companies over the last
two decades, European companies have started to implement strong cost-cutting
measures, analyze and carefully restructure their organizations and employ
technology designed to increase overall efficiency. As a result, companies are
operating in much stronger, smarter and more profitable ways than in years past.
The benefit for many is an increase in revenue, healthier profits and a positive
impact on their stocks' share prices.
EMU is building positive momentum across Europe by enabling companies to better
leverage their operations in a more global business environment. While the Fund
looks at companies of various sizes, it has an orientation toward stocks of
larger companies -- an important advantage for global investors. Because they
are better established, financially stronger and more experienced than smaller
companies, larger companies are well positioned for growth within a globalized
economy. With the ability to offer existing products in new markets and to seek
lower labor costs in other regions, these companies are positioned to achieve
two important objectives: an increase in demand for the products and services
they offer and better economies of scale.
OPPORTUNITY IS WHERE YOU FIND IT
One example of a stock that has been very profitable for the Fund is Mannesmann
(0.70% of the Fund's total net assets). It's a large German industrial
engineering company that has leveraged its existing infrastructure and
intellectual capital to transform itself into a major European
telecommunications player in both cellular and traditional telephone service. As
an engineering company doing project work in the telecommunications industry,
they had a solid foundation of knowledge before venturing into the market. In
addition to being a successful provider of traditional telephone service, their
cellular subscriptions have already increased 80% from the end of 1997 through
the first four months of 1998. Relative to other European telecommunication
stocks, it appeared undervalued. We purchased the stock in December 1997;
through April 30, 1998, its price rose about 76%.
THE GLOBAL ECONOMY APPEARS STRONG
The strong economic and financial activity that has taken place in Europe is
encouraging and reinforces the importance of maintaining global diversification
in your investment portfolio. Our outlook for the global economy is positive.
While the U.S. appears to be in the late stages of an economic expansion, many
European countries are just getting started. There's a world of investment
opportunity out there, and the Fund continually strives to take advantage of it.
<PAGE>
COLONIAL GLOBAL EQUITY FUND'S INVESTMENT PERFORMANCE VS.
THE MORGAN STANLEY CAPITAL INTERNATIONAL WORLD (GDP) ND INDEX
Change in Value of $10,000 from 6/30/92 - 4/30/98
Based on NAV and POP for Class A Shares
NAV POP MSCI
- -------------------------------------------------------------------------------
Jun 30, 92 $10,000 $10,000 $10,000
Jul 31, 92 10,081 9,501 9,905
Aug 31, 92 9,869 9,301 10,130
Sep 30, 92 9,747 9,187 9,895
Oct 30, 92 9,434 8,892 9,661
Nov 30, 92 9,505 8,959 9,783
Dec 31, 92 9,690 9,133 9,825
Jan 29, 93 9,946 9,374 9,917
Feb 26, 93 10,069 9,490 10,194
Mar 31, 93 10,540 9,934 10,711
Apr 30, 93 10,755 10,136 11,277
May 28, 93 11,010 10,377 11,485
Jun 30, 93 10,734 10,116 11,358
Jul 30, 93 10,961 10,331 11,566
Aug 31, 93 11,746 11,071 12,248
Sep 30, 93 11,756 11,080 12,022
Oct 29, 93 12,149 11,450 12,334
Nov 30, 93 11,973 11,285 11,652
Dec 31, 93 13,101 12,348 12,237
Jan 31, 94 13,685 12,898 13,009
Feb 28, 94 13,258 12,495 12,826
Mar 31, 94 12,705 11,974 12,516
Apr 29, 94 12,861 12,122 12,980
May 31, 94 12,747 12,014 12,849
Jun 30, 94 12,567 11,845 12,706
Jul 29, 94 13,009 12,261 13,054
Aug 31, 94 13,419 12,647 13,390
Sep 30, 94 13,124 12,370 13,007
Oct 31, 94 13,335 12,568 13,347
Nov 30, 94 12,767 12,033 12,794
Dec 30, 94 12,889 12,148 12,925
Jan 31, 95 12,510 11,790 12,827
Feb 28, 95 12,924 12,181 13,023
Mar 31, 95 13,211 12,452 13,519
Apr 28, 95 13,614 12,831 14,043
May 31, 95 13,878 13,080 14,178
Jun 30, 95 14,095 13,285 14,222
Jul 31, 95 15,046 14,181 14,987
Aug 31, 95 14,768 13,918 14,574
Sep 29, 95 14,768 13,918 14,895
Oct 31, 95 14,431 13,602 14,609
Nov 30, 95 14,663 13,820 15,034
Dec 29, 95 15,010 14,147 15,521
Jan 31, 96 15,502 14,611 15,850
Feb 29, 96 15,650 14,750 15,931
Mar 29, 96 15,883 14,970 16,126
Apr 30, 96 16,351 15,411 16,541
May 31, 96 16,486 15,538 16,537
Jun 28, 96 16,388 15,446 16,639
Jul 31, 96 15,820 14,910 16,077
Aug 30, 96 16,116 15,189 16,203
Sep 30, 96 16,536 15,586 16,801
Oct 31, 96 16,611 15,655 16,859
Nov 29, 96 17,525 16,517 17,779
Dec 31, 96 17,866 16,838 17,564
Jan 31, 97 18,045 17,007 17,779
Feb 28, 97 18,155 17,111 17,894
Mar 31, 97 17,935 16,903 17,792
Apr 30, 97 18,279 17,228 18,171
May 30, 97 19,258 18,151 19,162
Jun 30, 97 20,237 19,074 20,182
Jul 31, 97 21,289 20,065 21,032
Aug 29, 97 19,712 18,578 19,622
Sep 30, 97 21,026 19,817 20,795
Oct 31, 97 19,753 18,618 19,608
Nov 28, 97 20,182 19,022 19,878
Dec 31, 97 20,465 19,288 20,172
Jan 30, 98 20,884 19,683 20,892
Feb 27, 98 22,311 21,028 22,201
Mar 31, 98 23,676 22,315 23,399
Apr 30, 98 23,924 22,549 23,715
CURRENT VALUE OF A $10,000 INVESTMENT
Made on 6/30/92
- -------------------------------------------------------------------------------
CLASS A SHARES CLASS B SHARES CLASS C SHARES
NAV POP NAV w/CDSC NAV w/CDSC
- -------------------------------------------------------------------------------
$23,924 $22,549 $22,825 $22,725 $22,862 $22,862
AVERAGE ANNUAL TOTAL RETURNS
As of 4/30/98
- -------------------------------------------------------------------------------
CLASS A SHARES CLASS B SHARES CLASS C SHARES
INCEPTION 6/8/92 6/8/92 8/1/97
NAV POP NAV w/CDSC NAV w/CDSC
- -------------------------------------------------------------------------------
1 YEAR 30.88% 23.36% 29.89% 24.89% 30.10% 29.10%
- -------------------------------------------------------------------------------
3 YEARS 20.68 18.32 19.66 18.96 19.73 19.73
- -------------------------------------------------------------------------------
5 YEARS 17.34 15.96 16.41 16.19 16.45 16.45
- -------------------------------------------------------------------------------
LIFE 15.74 14.58 14.80 14.71 14.83 14.83
- -------------------------------------------------------------------------------
Past performance cannot predict future results. Returns and value of an
investment will vary, resulting in a gain or loss on sale. All results shown
assume reinvestment of distributions. NAV returns do not include sales charges
or contingent deferred sales charges (CDSC). Public offering price (POP) returns
include the maximum sales charge of 5.75% for Class A shares. The CDSC returns
reflect the maximum charges of 5% for one year, 2% for five years and 1% since
inception for Class B shares and 1% for one year for Class C shares. Performance
for different share classes will vary based on differences in sales charges and
fees associated with each class.
Class C share performance includes returns of the Fund's Class B shares (the
oldest existing fund class) for periods prior to 8/1/97. These Class B share
returns are not restated to reflect any expense differential (e.g., Rule 12b-1
fees) between Class B shares and Class C shares. Had the expense differential
been reflected, the returns for periods prior to 8/1/97 for Class C shares would
have been lower.
The Morgan Stanley Capital International World (GDP) ND Index is an unmanaged
index that tracks the performance of global stocks. Unlike mutual funds, an
index does not incur fees or charges, and it is not possible to invest in an
index.
<PAGE>
INVESTMENT PORTFOLIO
APRIL 30, 1998 (UNAUDITED, IN THOUSANDS)
COMMON STOCKS - 95.2% COUNTRY SHARES VALUE
- -----------------------------------------------------------------------------
AGRICULTURE, FORESTRY & FISHING - 0.4%
AGRICULTURE - CROPS
Tabacalera SA Sp 26 $ 565
--------
- -----------------------------------------------------------------------------
CONSTRUCTION - 0.4%
BUILDING CONSTRUCTION
Sulzer AG Sz 1 537
--------
- -----------------------------------------------------------------------------
FINANCE, INSURANCE & REAL ESTATE - 24.1%
DEPOSITORY INSTITUTIONS - 12.4%
Allied Irish Bank Ir 45 627
Banco Popolare di Milano (BPM) It 41 371
Banco Popular Espanol SA Sp 7 557
Banco Totta & Acores SA Pt 29 1,095
Bank of Montreal Ca 11 594
Barclays PLC UK 23 663
Bayerische Hypotheken - Und Wechsel Bank AG G 12 670
Cie Financiere de Paribas Fr 6 649
Commerzbank AG G 15 572
Corporacion Bancaria de Espana SA Sp 7 566
Credito Italiano It 145 756
Development Bank of Singapore Ltd. - Foreign Si 35 232
(Bonus Shares)
Development Bank of Singapore Ltd. - Foreign Si 4 23
First American Corp. 19 917
ForeningsSparbanken AB Sw 31 974
Grupo Financiero Banamex Accival, SA de CV
(Banacci) (a) Mx 223 691
HSBC Holdings PLC HK 20 582
HSBC Holdings PLC UK 34 1,000
Merita Ltd., Class A Fi 103 686
Royal Bank of Scotland Group PLC UK 36 555
Standard Chartered PLC UK 39 597
The Bank of Tokyo Mitsubishi Ja 95 1,172
The Sanwa Bank Ltd. Ja 60 528
UBS-Union Bank of Switzerland Sz 644
Westpac Banking Corp. Au 76 510
--------
16,231
--------
HOLDING COMPANIES - 0.3%
Cheung Kong (Holdings) Ltd. HK 64 425
--------
INSURANCE CARRIERS - 7.0%
AXA Fr 9 1,011
Allianz AG G 2 553
Insurance Carriers - Cont.
Cigna Corp. 5 1,076
International Nederlanden Groep Ne 18 1,169
Mercury General Corp. 13 842
Old Republic International Corp. 22 1,009
Royal & Sun Alliance Insurance Group PLC UK 44 491
Storebrand ASA No 72 636
Torchmark Corp. 21 940
Toro Assicurazioni It 34 595
Zurich Versicherungs-Gesellschaft Sz 1 807
--------
9,129
--------
INVESTMENT COMPANIES - 2.9%
Chile Fund, Inc. Ch 45 735
First Australia Fund, Inc. Au 58 451
First Philippine Fund, Inc. Ph 41 311
Irish Investment Fund, Inc. Ir 46 1,148
Southern Africa Fund, Inc. SA 25 426
Templeton Dragon Fund, Inc. (b) 63 688
--------
3,759
--------
NONDEPOSITORY CREDIT INSTITUTIONS - 1.2%
Nichiei Co., Ltd. Ja 9 668
Promise Co., Ltd. Ja 17 860
--------
1,528
--------
REAL ESTATE - 0.3%
New World Development Co., Ltd. HK 116 330
--------
- -----------------------------------------------------------------------------
MANUFACTURING - 41.4%
CHEMICALS $ ALLIIED PRODUCRS - 7.8%
Akzo Nobel NV Ne 4 833
BASF AG G 14 632
Clorox Co. 16 1,325
E.I. DuPont De Nemours & Co. 14 983
Kao Corp. Ja 44 644
Merck & Co., Inc. 10 1,241
Novartis Sz 1 951
Rhone Poulenc, Class A Fr 11 517
Roche Holding AG Sz 456
Schering-Plough Corp. 14 1,130
Yamanouchi Pharmaceutical Co. Ja 37 871
Zeneca Group PLC UK 14 603
--------
10,186
--------
COMMUNICATIONS EQUIPMENT - 4.7%
Lucent Technologies, Inc.. 26 1,994
Philips Electronics NV Ne 12 1,039
Racal Electronics PLC UK 181 1,010
Sony Corp. Ja 13 1,077
Telefonakteibolaget LM Ericsson Sw 21 1,085
--------
6,205
--------
ELECTRICAL INDUSTRIAL EQUIPMENT - 0.6%
General Electric Co. 9 749
--------
Electronic Components - 1.2%
Alcatel Alsthom (Cie Gen El) Fr 4 665
TDK Corp. Ja 12 944
--------
1,609
--------
FABRICATED METAL - 0.5%
Compagnie Generale d'Industrie
et de Participations Fr 1 639
--------
FOOD & KINDRED PRODUCTS - 5.2%
Associated British Foods PLC UK 72 675
Bass PLC UK 76 1,450
Bass PLC, Class B (a) UK 80 119
Diageo PLC UK 52 619
Fraser & Neave Ltd. Si 40 179
Group Industrial Maseca Mx 492 354
Groupe Danone Fr 3 750
Montedison SPA It 452 570
Nestle AG Sz 649
Parmalat Finanziara SPA It 290 649
Unilever NV Ne 12 863
--------
6,877
--------
HOUSEHOLD APPLIANCES - 0.5%
Electrolux AB, Series B Sw 7 632
--------
MACHINERY & COMPUTER EQUIPMENT - 5.2%
Canon, Inc. Ja 39 919
Cummins Engine Co., Inc. 10 560
Fujitsu Ltd. Ja 69 802
Hewlett-Packard Co. 9 678
Hitachi Ltd. Ja 54 386
Mannesmann AG G 1 912
Oerlikon-Buehrle Holding AG Sz 4 669
Sanyo Electric Company Ltd. Ja 221 625
Siebe PLC UK 57 1,273
--------
6,824
--------
MEASURING & ANALYZING INSTRUMENTS - 0.7%
Fuji Photo Film Co., Ltd. Ja 26 921
--------
MISCELLANEOUS MANUFACTURING - 0.3%
Polygram NV Ne 10 412
--------
PAPER PRODUCTS - 2.1%
Aracruz Celulose SA ADR Bz 26 410
Asia Pulp & Paper Company Ltd. ADR Si 87 1,267
Carter Holt Harvey NZ 190 252
Royal Koninklijke PTT Nederland NV Ne 15 759
--------
2,688
--------
PETROLEUM REFINING - 3.3%
Amerada Hess Corp. 19 1,064
Ashland Oil, Inc. 15 809
ENI It 95 633
OMV Handels AG Aus 8 1,186
Royal Dutch Petroleum Co. Ne 10 557
--------
4,249
--------
PRIMARY METAL - 0.9%
Pirelli SPA It 188 619
USX-US Steel Group 14 548
--------
1,167
--------
PRINTING & PUBLISHING - 1.2%
Belo (A.H.) Corp., Series A 17 900
Mondadori (Arnoldo) Editore SPA It 63 707
--------
1,607
--------
RUBBER & PLASTIC - 1.7%
Continental AG G 30 850
Cooper Tire & Rubber Co. 21 497
Premark International, Inc. 26 861
--------
2,208
--------
STONE, CLAY, GLASS & CONCRETE - 1.8%
Cemex SA Mx 197 982
Cimentos de Portugal SA Pt 17 632
Hanson PLC UK 127 746
--------
2,360
--------
TOBACCO PRODUCTS - 0.5%
B.A.T. Industries PLC UK 69 654
--------
TRANSPORTATION EQUIPMENT - 3.2%
Dana Corp. 17 981
General Dynamics Corp. 13 532
Honda Motor Co., Ltd. Ja 35 1,264
MAN AG G 1 473
Textron, Inc. 2 157
Volkswagen AG G 1 716
--------
4,123
--------
- -----------------------------------------------------------------------------
MINING & ENERGY - 1.7%
OIL & GAS EXTRACTION - 1.0%
Santos Ltd. Aus 85 306
YPF SA Ar 30 1,031
--------
1,337
--------
OIL & GAS FIELD SERVICES - 0.7%
Petroleum Geo-Services (a) No 14 927
--------
- -----------------------------------------------------------------------------
RETAIL TRADE - 6.6%
APPAREL & ACCESSORY STORES - 0.8%
Hennes & Mauritz AB Sw 20 1,015
--------
FOOD STORES - 3.0%
Jeronimo Martins, SGPS, SA Pt 13 589
Safeway, Inc. (a) 37 1,415
Tesco PLC UK 67 627
Valora Holding AG Sz 3 659
Vendex International NV Ne 10 641
--------
3,931
--------
GENERAL MERCHANDISE STORES - 1.0%
Wal-Mart Stores, Inc. 27 1,340
--------
MISCELLANEOUS RETAIL - 1.3%
Imasco Ltd. Ca 16 606
Pinault-Printemps SA Fr 1 617
Rite Aid Corp. 16 508
--------
1,731
--------
RESTAURANTS - 0.5%
TelePizza SA (a) Sp 5 675
--------
- -----------------------------------------------------------------------------
SERVICES - 9.0%
AMUSEMENT & RECREATION - 0.7%
Ladbroke Group PLC UK 159 873
--------
COMPUTER RELATED SERVICES - 0.8%
Cap Gemini SA Fr 8 1,043
--------
COMPUTER SOFTWARE - 4.2%
Cerner Corp. (a) 29 862
Computer 2000 AG (a) G 2 736
Compuware Corp. (a) 27 1,339
Microsoft Corp. (a) 9 775
SAP AG G 1 686
Sungard Data Systems, Inc. (a) 32 1,140
--------
5,538
--------
HEALTH SERVICES - 2.1%
Health Care & Retirement Corp. (a) 30 1,210
Quorum Health Group, Inc. (a) 47 1,508
--------
2,718
--------
HOTELS, CAMPS & LODGING - 0.5%
Accor SA Fr 3 703
--------
PERSONAL SERVICES - 0.7%
Service Corporation International 22 916
--------
- -----------------------------------------------------------------------------
TRANSPORTATION, COMMUNICATIONS, ELECTRIC, GAS &
SANITARY SERVICES - 11.3%
ELECTRIC SERVICES - 1.8%
Empresa Nacional De Electricidad Sp 38 921
Enova Corp. 22 589
Oestereichisch Elektrizitatswirtschafts AG Aus 7 816
--------
2,326
--------
GAS SERVICES - 0.5%
NICOR, Inc. 14 589
--------
TELECOMMUNICATION - 9.0%
Bell Atlantic Corp. 12 1,095
British Telecommunications PLC UK 56 607
Deutsche Telekom G 30 751
France Telecom SA Fr 11 608
Hong Kong Telecommunications Ltd. HK 244 469
Nippon Telegraph & Telephone Corp. Ja 960
Nokia Oy AB, Class K Fi 16 1,089
Portugal Telecom SA Pt 13 677
Telecom Italia SPA It 65 491
Telecomunicacoes Brasileiras ADR Bz 8 975
Telefonica de Argentina ADR Ar 30 1,138
Telefonica de Espana Sp 15 632
Telefonos de Mexico SA Mx 414 1,168
Telus Corp. Ca 15 412
WorldCom, Inc. (a) 15 655
--------
11,727
--------
WHOLESALE TRADE - 0.3%
NONDURABLE GOODS
VEBA AG G 7 452
--------
TOTAL COMMON STOCKS (cost of $102,016) 124,455
--------
RIGHTS - 0.0%
- -----------------------------------------------------------------------------
FINANCE, INSURANCE & REAL ESTATE - 0.0%
DEPOSITORY INSTITUTIONS
Development Bank of Singapore Ltd. (cost of $0) Si 7 9
--------
TOTAL INVESTMENTS (cost of $102,016) (c) 124,464
--------
SHORT-TERM OBLIGATIONS - 6.7% PAR
- -----------------------------------------------------------------------------
Repurchase agreement with ABN AMRO Chicago Corp.,
dated 04/30/98, due 05/01/98 at 5.520%,
collateralized by U.S. Treasury notes and bill
with various maturities to 2021, market value
$10,660 (repurchase proceeds $8,810) $ 8,809 8,809
--------
FORWARD CURRENCY CONTRACTS - (0.0)% (e) (14)
- -----------------------------------------------------------------------------
OTHER ASSETS & LIABILITIES, NET - (1.9)% (2,519)
- -----------------------------------------------------------------------------
NET ASSETS - 100.0% $130,740
========
NOTES TO INVESTMENT PORTFOLIO:
- -----------------------------------------------------------------------------
(a) Non-income producing.
(b) This security is subject to the risks of the various countries in which the
issuer is investing. (See notes to Financial Statements: Note 3. - Other.)
(c) Cost for federal income tax purposes is the same. (d) As of April 30, 1998,
the Fund had entered into the following forward currency exchange contracts:
Net Unrealized
Appreciation
Contracts In Exchange Settlement (Depreciation)
to Deliver For Date (U.S. $)
---------- ----------- ---------- --------------
US$ 2,624 JY 346,798 05/01/98 (14)
DM 89 US$ 49 05/04/98 (e)
IL 2,126,021 US$ 1,202 05/05/98 2
SP 113,666 US$ 745 05/05/98 (e)
IL 2,157,590 US$ 1,216 05/07/98 (1)
US$ 1,345 KB 805 05/07/98 (1)
------------
(14)
------------
(e) Rounds to less than one.
Summary of Securities by Country Country Value % of Total
- -------------------------------------------------------------------------------
United States $ 34,422 27.7
Japan Ja 12,641 10.2
United Kingdom UK 12,562 10.1
Germany G 8,003 6.4
France Fr 7,202 5.8
Netherlands Ne 6,273 5.0
Italy It 5,391 4.3
Switzerland Sz 5,372 4.3
Spain Sp 3,916 3.1
Sweden Sw 3,706 3.0
Mexico Mx 3,195 2.6
Portugal Pt 2,993 2.4
Austria Aus 2,308 1.9
Hong Kong HK 1,806 1.5
Finland Fi 1,775 1.4
Brazil Bz 1,385 1.1
Ireland Ir 1,775 1.4
Canada Ca 1,612 1.3
Norway No 1,563 1.3
Argentina Ar 2,169 1.7
Australia Au 961 0.8
Chile Ch 735 0.6
Singapore Si 1,710 1.4
South Africa SA 426 0.3
Philippines Ph 311 0.2
New Zealand NZ 252 0.2
------------ ------------
$ 124,464 100.0
============ ============
Certain securities are listed by country of underlying exposure but may
trade predominantly on other exchanges.
Acronym Name
------- ----
ADR American Depositary Receipt
DM Deutschemarks
IL Italian Lira
JY Japanese Yen
KB British Pounds
SP Spanish Pesetas
See notes to financial statements.
<PAGE>
STATEMENT OF ASSETS & LIABILITIES
APRIL 30, 1998 (UNAUDITED)
(in thousands except for per share amounts and footnotes)
ASSETS
Investments at value (cost $102,016) $ 124,464
Short-term obligations 8,809
---------
133,273
Cash held in foreign banks (cost $169) $ 170
Receivable for:
Investments sold 3,193
Fund shares sold 327
Dividends 300
Foreign tax reclaims 76
Interest 1
Other 21 4,088
------ ---------
Total Assets 137,361
LIABILITIES
Unrealized depreciation on forward
currency contracts 14
Payable for:
Investments purchased 6,197
Fund shares repurchased 404
Payable to Adviser 3
Accrued Deferred Trustees Fees 3
------
Total Liabilities 6,621
---------
NET ASSETS $ 130,740
=========
Net asset value & redemption price per share -
Class A ($47,073/3,053) $ 15.42
=========
Maximum offering price per share - Class A
($15.42/0.9425) $ 16.36(a)
=========
Net asset value & offering price per share -
Class B ($82,322/5,400) $ 15.24(b)
=========
Net asset value & offering price per share -
Class C ($1,345/88) $ 15.39(b)
=========
(a) On sales of $50,000 or more the offering price is reduced.
(b) Redemption price per share is equal to net asset value less any
applicable contingent deferred sales charge.
See notes to financial statements.
<PAGE>
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED APRIL 30, 1998
(UNAUDITED)
(in thousands)
INVESTMENT INCOME
Dividends $ 1,080
Interest 258
--------
Total investment income (net of nonreclaimable
foreign taxes withheld at source which
amounted to $117) 1,338
EXPENSES
Management fee $ 556
Service fee 147
Distribution fee - Class B 284
Distribution fee - Class C 3
Transfer agent 178
Bookkeeping fee 25
Trustees fee 7
Custodian fee 39
Audit fee 16
Legal fee 3
Registration fee 22
Reports to shareholders 5
Other 12
-------
1,297
Fees and expenses waived
or borne by the Adviser (42) 1,255
------- --------
Net Investment Income 83
--------
NET REALIZED & UNREALIZED GAIN (LOSS) ON PORTFOLIO POSITIONS Net
realized gain (loss) on:
Investments 10,992
Foreign currency transactions (45)
--------
Net Realized Gain 10,947
Change in net unrealized appreciation during the period on:
Investments 11,181
Foreign currency transactions (a)
-------
Net Gain 22,128
--------
Increase in Net Assets from Operations $ 22,211
========
(a) Rounds to less than one.
See notes to financial statements.
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
(Unaudited)
Six months Year ended
(in thousands) ended April 30 October 31
-------------- ------------
INCREASE (DECREASE) IN NET ASSETS 1998 1997 (a)
Operations:
Net investment income $ 83 $ 679
Net realized gain 10,947 11,621
Net unrealized appreciation 11,181 3,189
-------------- -------------
Net Increase from Operations 22,211 15,489
Distributions:
From net investment income - Class A (221) (131)
In excess of net investment income - Class A (7) --
From net realized gains - Class A (3,875) (2,143)
From net investment income - Class B (157) --
In excess of net investment income - Class B (5)
From net realized gains - Class B (7,784) (6,988)
From net investment income - Class C (4) --
In excess of net investment income - Class C (b) --
From net realized gains - Class C (97) --
--------- ---------
10,061 6,227
--------- ---------
Fund Share Transactions:
Receipts for shares sold - Class A 9,375 18,684
Value of distributions reinvested - Class A 3,813 2,135
Cost of shares repurchased - Class A (5,020) (6,517)
--------- ---------
8,168 14,302
--------- ---------
Receipts for shares sold - Class B 11,434 21,200
Value of distributions reinvested - Class B 7,330 6,378
Cost of shares repurchased - Class B (15,891) (24,577)
--------- ---------
2,873 3,001
--------- ---------
Receipts for shares sold - Class C 899 777
Value of distributions reinvested - Class C 95 --
Cost of shares repurchased - Class C (464) (5)
--------- ---------
530 772
--------- ---------
Net Increase from
Fund Share Transactions 11,571 18,075
--------- ---------
Total Increase 21,632 24,302
NET ASSETS
Beginning of period 109,108 84,806
--------- ---------
End of period (net of overdistributed
and including undistributed net investment
income of $4 and $343, respectively) $ 130,740 $ 109,108
========= =========
(a) Class C shares were initially offered on August 1, 1997.
(b) Round to less than one.
See notes to financial statements.
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
(continued)
(Unaudited)
Six months Year ended
ended April 30 October 31
-------------- ------------
NUMBER OF FUND SHARES 1998 1997 (a)
Sold - Class A 655 1,339
Issued for distributions reinvested - Class A 286 168
Repurchased - Class A (352) (463)
--------- ---------
589 1,044
--------- ---------
Sold - Class B 797 1,523
Issued for distributions reinvested - Class B 555 509
Repurchased - Class B (1,133) (1,772)
--------- ---------
219 260
--------- ---------
Sold - Class C 62 52
Issued for distributions reinvested - Class C 7 --
Repurchased - Class C (33) (b)
--------- ---------
36 52
--------- ---------
(a) Class C shares were initially offered on August 1, 1997.
(b) Round to less than one.
See notes to financial statements.
<PAGE>
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 1998 (UNAUDITED)
NOTE 1. INTERIM FINANCIAL STATEMENTS
- -------------------------------------------------------------------------------
In the opinion of management of Colonial Global Equity Fund (the Fund), a series
of Colonial Trust III, the accompanying financial statements contain all normal
and recurring adjustments necessary for the fair presentation of the financial
position of the Fund at April 30, 1998, and the results of its operations, the
changes in its net assets and the financial highlights for the six months then
ended.
NOTE 2. ACCOUNTING POLICIES
- -------------------------------------------------------------------------------
ORGANIZATION: The Fund is a diversified portfolio of a Massachusetts business
trust, registered under the Investment Company Act of 1940, as amended, as an
open-end management investment company. The Fund's investment objective is to
seek long-term growth by investing primarily in global equities. The Fund may
issue an unlimited number of shares. The Fund offers three classes of shares:
Class A, Class B, and Class C. Class A shares are sold with a front-end sales
charge and Class B shares are subject to an annual distribution fee and a
contingent deferred sales charge. Class B shares will convert to Class A shares
when they have been outstanding approximately eight years. Class C shares are
subject to a contingent deferred sales charge on redemptions made within one
year after purchase and a continuing distribution fee.
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates. The following is a summary of
significant accounting policies consistently followed by the Fund in the
preparation of its financial statements.
SECURITY VALUATION AND TRANSACTIONS: Equity securities generally are valued at
the last sale price or, in the case of unlisted or listed securities for which
there were no sales during the day, at current quoted bid prices.
Forward currency contracts are valued based on the weighted value of the
exchange traded contracts with similar durations.
Short-term obligations with a maturity of 60 days or less are valued at
amortized cost.
The value of all assets and liabilities quoted in foreign currencies are
translated into U.S. dollars at that day's exchange rates.
Portfolio positions for which market quotations are not readily available are
valued at fair value under procedures approved by the Trustees.
Security transactions are accounted for on the date the securities are
purchased, sold or mature.
Cost is determined and gains and losses are based upon the specific
identification method for both financial statement and federal income tax
purposes.
DETERMINATION OF CLASS NET ASSET VALUES AND FINANCIAL HIGHLIGHTS: All income,
expenses (other than the Class B and Class C distribution fees), and realized
and unrealized gains (losses), are allocated to each class proportionately on a
daily basis for purposes of determining the net asset value of each class.
The per share data was calculated using average shares outstanding during the
period. In addition, Class B and Class C net investment income per share data
reflects the distribution fee applicable to Class B and Class C shares only.
Class B and Class C ratios are calculated by adjusting the expense and net
investment income per share data and ratios for the Fund for the entire period
by the distribution fee applicable to Class B and Class C shares only.
FEDERAL INCOME TAXES: Consistent with the Fund's policy to qualify as a
regulated investment company and to distribute all of its taxable income, no
federal income tax has been accrued.
INTEREST INCOME, DEBT DISCOUNT AND PREMIUM: Interest income is recorded on the
accrual basis. Original issue discount is accreted to interest income over the
life of a security with a corresponding increase in the cost basis; premium and
market discount are not amortized or accreted.
DISTRIBUTIONS TO SHAREHOLDERS: Distributions to shareholders are recorded on the
ex-date.
The amount and character of income and gains to be distributed are determined in
accordance with income tax regulations which may differ from generally accepted
accounting principles. Reclassifications are made to the Fund's capital accounts
to reflect income and gains available for distribution (or available capital
loss carryforwards) under income tax regulations.
FOREIGN CURRENCY TRANSACTIONS: Net realized and unrealized gains (losses) on
foreign currency transactions includes gains (losses) arising from the
fluctuations in exchange rates between trade and settlement dates on securities
transactions, gains (losses) arising from the disposition of foreign currency,
and currency gains (losses) between the accrual and payment dates on dividends
and interest income and foreign withholding taxes.
The Fund does not distinguish that portion of gains (losses) on investments
which is due to changes in foreign exchange rates from that which is due to
changes in market prices of the investments. Such fluctuations are included with
the net realized and unrealized gains (losses) on investments.
FORWARD CURRENCY CONTRACTS: The Fund may enter into forward currency contracts
to purchase or sell foreign currencies at predetermined exchange rates in
connection with the settlement of purchases and sales of securities. The Fund
may also enter into forward currency contracts to hedge certain other foreign
currency denominated assets. The contracts are used to minimize the exposure to
foreign exchange rate fluctuations during the period between trade and
settlement date of the contracts. All contracts are marked-to-market daily,
resulting in unrealized gains (losses) which become realized at the time the
forward currency contracts are closed or mature. Realized and unrealized gains
(losses) arising from such transactions are included in net realized and
unrealized gains (losses) on foreign currency transactions. Forward currency
contracts do not eliminate fluctuations in the prices of the Fund's portfolio
securities. While the maximum potential loss from such contracts is the
aggregate face value in U.S. dollars at the time the contract was opened,
exposure is typically limited to the change in value of the contract (in U.S.
dollars) over the period it remains open. Risks may also arise if counterparties
fail to perform their obligations under the contracts.
OTHER: Corporate actions are recorded on ex-date (except for certain foreign
securities which are recorded as soon after ex-date as the Fund becomes aware of
such), net of nonreclaimable tax withholdings. Where a high level of uncertainty
as to collection exists, income on securities is recorded net of all tax
withholdings with any rebates recorded when received.
The Fund's custodian takes possession through the federal book-entry system of
securities collateralizing repurchase agreements. Collateral is marked-to-market
daily to ensure that the market value of the underlying assets remains
sufficient to protect the Fund. The Fund may experience costs and delays in
liquidating the collateral if the issuer defaults or enters bankruptcy.
NOTE 3. FEES AND COMPENSATION PAID TO AFFILIATES
- -------------------------------------------------------------------------------
MANAGEMENT FEE: Colonial Management Associates, Inc. (the Adviser) is the
investment Adviser of the Fund and furnishes accounting and other services and
office facilities for a monthly fee equal to 0.95% annually of the Fund's
average net assets.
BOOKKEEPING FEE: The Adviser provides bookkeeping and pricing services for
$27,000 per year plus 0.035% of the Fund's average net assets over $50 million.
TRANSFER AGENT: Colonial Investors Service Center, Inc. (the Transfer Agent), an
affiliate of the Adviser, provides shareholder services for a monthly fee equal
to 0.25% annually of the Fund's average net assets and receives reimbursement
for certain out of pocket expenses.
Effective October 1, 1997 and continuing through September 1998, the Transfer
Agent fee will be reduced by 0.0012% in cumulative monthly increments, resulting
in a decrease in the fee from 0.25% to 0.236% annually.
UNDERWRITING DISCOUNTS, SERVICE AND DISTRIBUTION FEES: Liberty Finanical
Investments, Inc. (the Distributor), a subsidiary of the Adviser, is the Fund's
principal underwriter. During the six months ended April 30, 1998, the Fund has
been advised that the Distributor retained net underwriting discounts of $6,740
on sales of the Fund's Class A shares and received contingent deferred sales
charges (CDSC) of $81,293 and $563 on Class B and Class C share redemptions,
respectively.
The Fund has adopted a 12b-1 plan which requires it to pay the Distributor a
service fee equal to 0.25% annually of the Fund's net assets as of the 20th of
each month. The plan also requires the payment of a distribution fee to the
Distributor equal to 0.75% annually of the average net assets attributable to
Class B and Class C shares only.
The CDSC and the fees received from the 12b-1 plan are used principally as
repayment to the Distributor for amounts paid by the Distributor to dealers who
sold such shares.
EXPENSE LIMITS: The Adviser has agreed, until further notice, to waive fees and
bear certain Fund expenses to the extent that total expenses (exclusive of
service and distribution fees, brokerage commissions, interest, taxes and
extraordinary expenses, if any) exceed 1.40% annually of the Fund's average net
assets.
OTHER: The Fund pays no compensation to its officers, all of whom are employees
of the Adviser.
The Fund's Trustees may participate in a deferred compensation plan which may be
terminated at any time. Obligations of the plan will be paid solely out of the
Fund's assets.
NOTE 4. PORTFOLIO INFORMATION
- -------------------------------------------------------------------------------
INVESTMENT ACTIVITY: During the six months ended April 30, 1998, purchases and
sales of investments, other than short-term obligations, were $41,269,700 and
$35,464,088, respectively.
Unrealized appreciation (depreciation) at April 30, 1998, based on cost
of investments for both financial statement and federal income tax
purposes was:
Gross unrealized appreciation $26,132,664
Gross unrealized depreciation (3,684,740)
-----------
Net unrealized appreciation $22,447,924
===========
OTHER: There are certain additional risks involved when investing in foreign
securities that are not inherent with investments in domestic securities. These
risks may involve foreign currency exchange rate fluctuations, adverse political
and economic developments and the possible prevention of foreign currency
exchange or the imposition of other foreign governmental laws or restrictions.
The Fund may focus its investments in certain industries, subjecting it to
greater risk than a fund that is more diversified.
NOTE 5. LINE OF CREDIT
- ------------------------------------------------------------------------------
The Fund may borrow up to 10% of its net assets under a line of credit for
temporary or emergency purposes. Any borrowings bear interest at one of the
following options determined at the inception of the loan: (1) federal funds
rate plus 1/2 of 1%, (2) the lending bank's base rate or (3) IBOR offshore loan
rate plus 1/2 of 1%. There were no borrowings under the line of credit during
the six months ended April 30,1998.
NOTE 6. COMPOSITION OF NET ASSETS
-----------------------------------------------------------------------------
At April 30, 1998, net assets consisted of:
Capital paid in $ 97,357
Overdistributed net investment income (4)
Accumulated net realized gain 10,949
Net unrealized appreciation (depreciation) on:
Investments 22,448
Foreign currency transactions (10)
---------
$ 130,740
=========
<PAGE>
FINANCIAL HIGHLIGHTS
Selected data for a share of each class outstanding throughout each period are
as follows:
(Unaudited)
Six months ended April 30
-----------------------------------------
1998
Class A Class B Class C
---------- ---------- -------------
Net asset value -
Beginning of period $ 14.280 $ 14.130 $ 14.260
------------- ------------ ------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss)(a)(b) 0.045 (0.009) (0.009)
Net realized and
unrealized gain (loss) 2.715 2.681 2.728
------------- ------------ ------------
Total from Investment
Operations 2.760 2.672 2.719
------------- ------------ ------------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS:
From net investment income (0.087) (0.031) (0.057)
In excess of
investment income (0.003) (0.001) (0.002)
From net realized gains (1.530) (1.530) (1.530)
------------- ------------ ------------
Total Distributions Declared
to Shareholders (1.620) (1.562) (1.589)
------------- ------------ ------------
Net asset value -
End of period $ 15.420 $ 15.240 $ 15.390
============= ============ ============
Total return (e) 21.12%(f)(g) 20.61%(f)(g) 20.80%(f)(g)
============= ============ ============
RATIOS TO AVERAGE NET ASSETS:
Expenses (h) 1.65(i) 2.40(i) 2.40(i)
Net investment income (loss) (h) 0.63(i) (0.12)%(i) (0.12)%(i)
Portfolio turnover (g) 33% 33% 33%
Average commission rate $ 0.0178 $ 0.0178 $ 0.0178
Net assets at end
of period (000) $ 47,073 $ 82,322 $ 1,345
(a) Net of fees and expenses waived or borne by the Adviser which amounted to:
$ 0.005 $ 0.005 $ 0.005
(b) Per share data was calculated using average shares outstanding during the
period.
(c) Class C share were initially offered on August 1, 1997. Per share amounts
reflect activity from that date.
(d) The amount shown for a share outstanding does not correspond with the
aggregate net gain on investments for the period due to the timing of sales
and repurchases of Fund shares in relation to fluctuating market values of
the investments of the Fund.
(e) Total return at net asset value assuming all distributions reinvested and
no initial sales charge or contingent deferred sales charge.
(f) Had the Adviser not waived or reimbursed a portion of expenses, total
return would have been reduced.
(g) Not annualized.
<PAGE>
FINANCIAL HIGHLIGHTS
Selected data for a share of each class outstanding throughout
each period are as follows:
Year ended October 31
--------------------------------------
1997
Class A Class B Class C (c)
---------- ---------- ----------
$ 13.440 $ 13.350 $ 15.390
---------- ---------- ----------
0.169 0.065 (0.025)
2.179 2.158 (1.105)(d)
---------- ---------- ----------
2.348 2.223 (1.130)
---------- ---------- ----------
(0.065) -- --
-- -- --
(1.443) (1.443) --
---------- ---------- ----------
(1.508) (1.443) --
---------- ---------- ----------
$ 14.280 $ 14.130 $ 14.260
========== ========== ==========
18.92% 18.02% (7.34)(g)%
========== ========== ==========
1.58% 2.33% 2.44(i)
1.22% 0.47% (0.68)%(i)
90% 90% 90%
$ 0.0250 $ 0.0250 $ 0.0250
$ 35,181 $ 73,188 $ 739
-- -- --
(h) The benefits derived from custody credits and directed brokerage
arrangements had no impact.
(i) Annualized.
<PAGE>
FINANCIAL HIGHLIGHTS
Selected data for a share of each class outstanding throughout each period are
as follows:
<TABLE>
<CAPTION>
Year ended October 31
----------------------------------------------------------------
1996 1995
Class A Class B Class A Class B
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Net asset value -
Beginning of period $ 12.450 $ 12.390 $ 12.690 $ 12.630
------------ ------------ ------------ ------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (a)(b) 0.123 0.027 0.167 0.076
Net realized and unrealized gain 1.664 1.634 0.735 0.735
------------ ------------ ------------ ------------
Total from Investment Operations 1.787 1.661 0.902 0.811
------------ ------------ ------------ ------------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS:
From net investment income (0.098) (0.027) (0.198) (0.107)
In excess of net
investment income (0.035) (0.010) -- --
From net realized gains (0.664) (0.664) (0.944) (0.944)
------------ ------------ ------------ ------------
Total Distributions Declared
to Shareholders (0.797) (0.701) (1.142) (1.051)
------------ ------------ ------------ ------------
Net asset value -
End of period $ 13.440 $ 13.350 $ 12.450 $ 12.390
============ ============ ============ ============
Total return (c) 15.10% 14.04% 8.23(d) 7.43(d)
============ ============ ============ ============
RATIOS TO AVERAGE NET ASSETS
Operating Expenses (e) 1.58% 2.33% 1.36% 2.11%
Interest expense -- -- -- --
Fees and expenses waived or
borne by the Adviser (e) -- -- 0.26% 0.26%
Net investment income 0.96% 0.21% 1.40% 0.65%
Portfolio turnover 125% 125% 74% 74%
Average commission rate (f) $ 0.0261 $ 0.0261 -- --
Net assets at end of period (000) $ 19,092 $ 65,714 $ 11,501 $ 59,131
(a) Net of fees and expenses waived or borne by the Adviser which amounted to:
-- -- $ 0.031 $ 0.031
(b) Per share data was calculated using average shares outstanding during the period.
(c) Total return at net asset value assuming all distributions reinvested and no initial sales charge or contingent deferred sales
charge.
(d) Had the Adviser not waived or reimbursed a portion of expenses, total return would have been reduced.
(e) The benefits derived from custody credits and directed brokerage arrangements had no impact.
(f) For fiscal years beginning on or after September 1, 1995, a fund is required to disclose its average commission rate per
share for trades on which commissions are charged.
</TABLE>
<PAGE>
FINANCIAL HIGHLIGHTS
Selected data for a share of each class outstanding throughout each period are
as follows:
Year ended October 31
- ----------------------------------------------------------------
1994 1993
Class A Class B Class A Class B
- ------------ ------------ ------------ ------------
$ 11.760 $ 11.720 $ 9.340 $ 9.310
- ------------ ------------ ------------ ------------
0.170 0.077 0.182 0.104
0.969 0.959 2.461 2.447
- ------------ ------------ ------------ ------------
1.139 1.036 2.643 2.551
- ------------ ------------ ------------ ------------
(0.166) (0.083) (0.223) (0.141)
-- -- -- --
(0.043) (0.043) -- --
- ------------ ------------ ------------ ------------
(0.209) (0.126) (0.223) (0.141)
- ------------ ------------ ------------ ------------
$ 12.690 $ 12.630 $ 11.760 $ 11.720
============ ============ ============ ============
9.76%(d) 8.88%(d) 28.77%(d) 27.70%(d)
============ ============ ============ ============
1.25% 2.00% 1.25% 2.00%
-- -- 0.01% 0.01%
0.36% 0.36% 0.51% 0.51%
1.38% 0.63% 1.75% 1.00%
52% 52% 58% 58%
-- -- -- --
$ 10,525 $ 63,139 $ 1,769 $ 40,837
$ 0.045 $ 0.045 $ 0.053 $ 0.053
<PAGE>
SHAREHOLDER SERVICES
TO MAKE INVESTING EASIER
Your Fund has one of the most extensive selections of shareholder services
available. Your financial advisor can help you arrange for any of these
services, or you can call Colonial Investors Service Center directly at
1-800-345-6611.
AFFORDABLE ADDITIONAL INVESTMENTS: Add to your account with as little as $50 on
most funds; $25 for an IRA account.
FREE EXCHANGES(1): Exchange all or part of your account into the same share
class of another fund distributed by Liberty Financial Investments, Inc. by
phone or mail.
EASY ACCESS TO YOUR MONEY(1): Make withdrawals from your account by phone, by
mail or, for certain funds, by check.
ONE-YEAR REINSTATEMENT PRIVILEGE: If you need access to your money, but then
choose to return it within one year, you can reinvest in any fund distributed by
Liberty Financial Investments of the same share class without any penalty or
sales charge.
FUNDAMATIC: Make periodic investments as low as $50 from your checking account
to your Fund account.
SYSTEMATIC WITHDRAWAL PLAN (SWP): Receive monthly, quarterly or semiannual
payments via check or bank transmission. There is a $5,000 account value
required, but no minimum for the payment amount. The maximum annual withdrawal
is 12% of account balance at time SWP is established. SWPs by check are
processed on the 10th calendar day of each month unless the 10th falls on a
non-business day or the first business day of the week. If this occurs, the
processing date will be the previous business day. Dividends and capital gains
must be reinvested.
AUTOMATED DOLLAR COST AVERAGING: Transfer money on a monthly basis from any fund
with a balance of $5,000 into the same share class of up to four other funds
distributed by Liberty Financial Investments. Minimum for each transfer is $100.
RETIREMENT PLANS: Choose from a broad range of retirement plans, including IRAs.
(1) Redemptions and exchanges are made at the next determined net asset value
after the request is received by the Transfer Agent. Proceeds may be more or
less than your original cost. The exchange privilege may be terminated at any
time. Exchanges are not available on all funds. Investors who purchase Class B
or C shares, or $1 million or more of Class A shares, may be subject to a
contingent deferred sales charge.
<PAGE>
HOW TO REACH COLONIAL
BY PHONE OR BY MAIL
BY TELEPHONE
CUSTOMER CONNECTION - 1-800-345-6611
For 24-hour account information, call from your touch-tone phone. (Rotary
callers will be automatically connected to a representative during business
hours.) A recorded message will guide you through the menu:
For fund prices, dividends and capital gains information .......... press [1]
For account information ........................................... press [2]
To speak to a service representative .............................. press [3]
For yield and total return information ............................ press [4]
For duplicate statements or new supply of checks .................. press [5]
To order duplicate tax forms and year-end statements .............. press [6]
(February through May)
To review your options at any time during your call ............... press [*]
To speak with a shareholder services representative about your account, call
Monday to Friday, 8:00 a.m. to 8:00 p.m. ET, and Saturdays from February through
mid-April, 10:00 a.m. to 2:00 p.m. ET.
COLONIAL TELEPHONE TRANSACTION DEPARTMENT - 1-800-422-3737
To purchase, exchange or sell shares by telephone, call Monday to Friday, 9:00
a.m. to 7:00 p.m. ET. Transactions received after the close of the New York
Stock Exchange will receive the next business day's closing price.
LITERATURE - 1-800-426-3750
To request literature on any fund distributed by Liberty Financial Investments,
call Monday to Friday, 8:30 a.m. to 6:30 p.m. ET.
BY MAIL
COLONIAL INVESTORS SERVICE CENTER, INC.
P.O. BOX 1722
BOSTON, MA 02105-1722
<PAGE>
SHAREHOLDER COMMUNICATIONS
TO KEEP YOU INFORMED
To make recordkeeping easy and keep you up-to-date on the performance of your
investments, you can expect to receive the following information about your
account:
TRANSACTION CONFIRMATIONS: Each time you make a purchase, sale or exchange, you
receive a confirmation statement within just a few days.
QUARTERLY STATEMENTS: Every three months, if any transactions are made that
affect your share balance, this statement reports on your account activity
during the quarter (including any reinvestment of dividends). This statement
also provides year-to-date information.
LIBERTY FINANCIAL INVESTMENTS INVESTOR OPPORTUNITIES: Mailed with your quarterly
account statements, this newsletter highlights timely investment strategies,
portfolio manager commentary and shareholder service updates.
TAX FORMS AND YEAR-END TAX GUIDE: Easy-to-use forms and timely information are
designed to make tax reporting simpler. (Usually mailed in January.)
AVERAGE COST BASIS STATEMENTS: If you sold or exchanged shares during the year,
this statement may help you calculate your gain/loss for tax purposes. (Usually
mailed in February.)
<PAGE>
IMPORTANT INFORMATION ABOUT THIS REPORT
The Transfer Agent for Colonial Global Equity Fund is:
Colonial Investors Service Center, Inc.
P.O. Box 1722
Boston, MA 02105-1722
1-800-345-6611
Colonial Global Equity Fund mails one shareholder report to each shareholder
address. If you would like more than one report, please call 1-800-426-3750 and
additional reports will be sent to you.
This report has been prepared for shareholders of Colonial Global Equity Fund.
This report may also be used as sales literature when preceded or accompanied by
the current prospectus which provides details of sales charges, investment
objectives and operating policies of the Fund.
<PAGE>
TRUSTEES
ROBERT J. BIRNBAUM
Retired (formerly Special Counsel, Dechert, Price & Rhoads; President and Chief
Operating Officer, New York Stock Exchange, Inc.)
TOM BLEASDALE
Retired (formerly Chairman of the Board and Chief Executive Officer, Shore Bank
& Trust Company)
LORA S. COLLINS
Attorney (formerly Attorney, Kramer, Levin, Naftalis, & Frankel)
JAMES E. GRINNELL
Private Investor (formerly Senior Vice President-Operations, The Rockport
Company)
RICHARD W. LOWRY
Private Investor (formerly Chairman and Chief Executive Officer, U.S. Plywood
Corporation)
WILLIAM E. MAYER
Partner, Development Capital, L.L.C. (formerly Dean, College of Business and
Management, University of Maryland; Dean, Simon Graduate School of Business,
University of Rochester; Chairman and Chief Executive Officer, CS First Boston
Merchant Bank; and President and Chief Executive Officer, The First Boston
Corporation)
JAMES L. MOODY, JR.
Retired (formerly Chairman of the Board and Chief Executive Officer, Hannaford
Bros. Co.)
JOHN J. NEUHAUSER
Dean, Boston College School of Management
ROBERT L. SULLIVAN
Retired Partner, Peat Marwick Main & Co. (formerly Management Consultant,
Saatchi and Saatchi Consulting Ltd. and Principal and International Practice
Director, Management Consulting, Peat Marwick Main & Co.)
[logo] LIBERTY FINANCIAL INVESTMENTS, INC. (C)1998
Distributor for Colonial Funds, Stein Roe Advisor Funds and Newport Funds
One Financial Center, Boston, MA 02111-2621, 1-800-426-3750
Visit us at www.libertyfunds.com
GE-03/240F-0498 (6/98)
