<PAGE>
[LOGO]
COLUMBIA FUNDS
1997 ANNUAL REPORT
COLUMBIA COMMON STOCK FUND
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COLUMBIA GROWTH FUND
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COLUMBIA INTERNATIONAL STOCK FUND
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COLUMBIA SPECIAL FUND
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COLUMBIA SMALL CAP FUND
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COLUMBIA REAL ESTATE EQUITY FUND
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COLUMBIA BALANCED FUND
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COLUMBIA DAILY INCOME COMPANY
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COLUMBIA U.S. GOVERNMENT SECURITIES FUND
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COLUMBIA FIXED INCOME SECURITIES FUND
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COLUMBIA MUNICIPAL BOND FUND
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COLUMBIA HIGH YIELD FUND
<PAGE>
DEAR COLUMBIA INVESTOR:
We are pleased to present the 1997 Columbia Funds Shareholder Report. Inside you
will find updated financial information and summaries of each Fund's investment
activity for the year, along with a chart illustrating the growth of a
hypothetical investment, compared to each Fund's industry benchmark.
The "Overview of the Markets" on page one summarizes stock and bond market
activity during 1997. In addition, Columbia's investment approach is described,
highlighting themes and strategies used during the year to meet the objectives
of each Fund. We hope that you find this information helpful as you evaluate the
performance of your investments.
As always, we appreciate the confidence and trust you have placed in Columbia
Funds, and we look forward to helping you achieve your investment goals in the
months and years to come.
<TABLE>
<S> <C>
Sincerely,
[SIG] [SIG]
John A. Kemp Thomas L. Thomsen
CHAIRMAN AND CHIEF EXECUTIVE OFFICER PRESIDENT AND CHIEF INVESTMENT OFFICER
COLUMBIA FUNDS MANAGEMENT COMPANY COLUMBIA FUNDS MANAGEMENT COMPANY
</TABLE>
FRONT COVER FEATURES A PHOTOGRAPH OF THE 80-YEAR-OLD VISTA HOUSE,
PERCHED ATOP CROWN POINT AT THE MOUTH OF THE COLUMBIA RIVER GORGE.
THE PHOTO WAS TAKEN IN
OREGON, LOOKING ACROSS TO WASHINGTON STATE.
<PAGE>
TABLE OF CONTENTS
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ANNUAL REPORT, DECEMBER 31, 1997
AN OVERVIEW OF THE MARKETS.....................................................1
COLUMBIA COMMON STOCK FUND
Investment Review............................................................3
Financial Highlights........................................................15
Schedule of Investments.....................................................27
Statement of Assets and Liabilities.........................................61
Statement of Operations.....................................................64
Statements of Changes in Net Assets.........................................67
COLUMBIA GROWTH FUND
Investment Review............................................................4
Financial Highlights........................................................16
Schedule of Investments.....................................................29
Statement of Assets and Liabilities.........................................61
Statement of Operations.....................................................64
Statements of Changes in Net Assets.........................................67
COLUMBIA INTERNATIONAL STOCK FUND
Investment Review............................................................5
Financial Highlights........................................................17
Schedule of Investments.....................................................31
Statement of Assets and Liabilities.........................................61
Statement of Operations.....................................................64
Statements of Changes in Net Assets.........................................67
COLUMBIA SPECIAL FUND
Investment Review............................................................6
Financial Highlights........................................................18
Schedule of Investments.....................................................35
Statement of Assets and Liabilities.........................................61
Statement of Operations.....................................................64
Statements of Changes in Net Assets.........................................68
COLUMBIA SMALL CAP FUND
Investment Review............................................................7
Financial Highlights........................................................19
Schedule of Investments.....................................................37
Statement of Assets and Liabilities.........................................62
Statement of Operations.....................................................65
Statements of Changes in Net Assets.........................................68
COLUMBIA REAL ESTATE EQUITY FUND
Investment Review............................................................8
Financial Highlights........................................................20
Schedule of Investments.....................................................39
Statement of Assets and Liabilities.........................................62
Statement of Operations.....................................................65
Statements of Changes in Net Assets.........................................68
COLUMBIA BALANCED FUND
Investment Review............................................................9
Financial Highlights........................................................21
Schedule of Investments.....................................................40
Statement of Assets and Liabilities.........................................62
Statement of Operations.....................................................65
Statements of Changes in Net Assets.........................................69
COLUMBIA DAILY INCOME COMPANY
Investment Review...........................................................10
Financial Highlights........................................................22
Schedule of Investments.....................................................45
Statement of Assets and Liabilities.........................................62
Statement of Operations.....................................................65
Statements of Changes in Net Assets.........................................69
COLUMBIA U.S. GOVERNMENT SECURITIES FUND
Investment Review...........................................................11
Financial Highlights........................................................23
Schedule of Investments.....................................................48
Statement of Assets and Liabilities.........................................63
Statement of Operations.....................................................66
Statements of Changes in Net Assets.........................................69
COLUMBIA FIXED INCOME SECURITIES FUND
Investment Review...........................................................12
Financial Highlights........................................................24
Schedule of Investments.....................................................49
Statement of Assets and Liabilities.........................................63
Statement of Operations.....................................................66
Statements of Changes in Net Assets.........................................70
COLUMBIA MUNICIPAL BOND FUND
Investment Review...........................................................13
Financial Highlights........................................................25
Schedule of Investments.....................................................52
Statement of Assets and Liabilities.........................................63
Statement of Operations.....................................................66
Statements of Changes in Net Assets.........................................70
COLUMBIA HIGH YIELD FUND
Investment Review...........................................................14
Financial Highlights........................................................26
Schedule of Investments.....................................................58
Statement of Assets and Liabilities.........................................63
Statement of Operations.....................................................66
Statements of Changes in Net Assets.........................................70
NOTES TO FINANCIAL STATEMENTS.................................................71
COLUMBIA FUNDS
P.O. BOX 1350
PORTLAND, OR 97207-1350
222-3606
1-800-547-1707
WWW.COLUMBIAFUNDS.COM
<PAGE>
AN OVERVIEW OF THE MARKETS
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A LOOK BACK AT 1997
The year was ushered in with favorable economic conditions. While the GDP
exceeded expectations in the first quarter, it was not accompanied by higher
inflation. The Fed, nevertheless, responded to the quickly growing economy by
raising short-term interest rates .25% at the end of March. This action set the
tone for a dramatic increase in stock market volatility in the second quarter
that continued throughout much of the year. Immediately after the rate hike,
both the S&P 500 and NASDAQ gave up most of their year-to-date gains, only to
have investors bid prices right back up. By the end of the second quarter, the
S&P 500 had gained 20.59%, led by a narrow group of large company stocks.
GROSS DOMESTIC PRODUCT
VS. INFLATION IN 1997
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
GROSS DOMESTIC PRODUST VS. INFLATION IN
1997
GDP INFLATION
(SEASONALLY ADJUSTED
ANNUAL RATE)
<S> <C> <C>
1QTR 4.90%
2QTR 3.30%
3QTR 3.10%
4QTR 4.30%
</TABLE>
In the third quarter, the market began to broaden as investors gained confidence
about continued moderate economic growth and low inflation. Investors moved away
from large capitalization stocks to seek values in smaller cap companies and
issues overseas. Meanwhile, continuing earnings growth, expanding profit
margins, subdued inflation and low interest rates all suggested that the stock
market would prolong its historic bull run for a 13th consecutive year. Although
it appeared that the economy was approaching full utilization, there were no
signs of excess or imbalance that suggested the Fed might tighten rates in the
near term.
30-YEAR TREASURY YIELDS
OVER THE LAST SIX YEARS
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<S> <C>
1/3/92 7.48
1/10/92 7.39
1/17/92 7.61
1/24/92 7.71
1/31/92 7.76
2/7/92 7.76
2/14/92 7.9
2/21/92 7.94
2/28/92 7.79
3/6/92 7.93
3/13/92 8.07
3/20/92 8.05
3/27/92 7.94
4/3/92 7.88
4/10/92 7.89
4/17/92 7.94
4/24/92 8.04
5/1/92 8.01
5/8/92 7.89
5/15/92 7.82
5/22/92 7.82
5/29/92 7.84
6/5/92 7.85
6/12/92 7.88
6/19/92 7.83
6/26/92 7.78
7/3/92 7.63
7/10/92 7.63
7/17/92 7.68
7/24/92 7.57
7/31/92 7.46
8/7/92 7.39
8/14/92 7.32
8/21/92 7.35
8/28/92 7.42
9/4/92 7.28
9/11/92 7.29
9/18/92 7.32
9/25/92 7.36
10/2/92 7.33
10/9/92 7.52
10/16/92 7.53
10/23/92 7.64
10/30/92 7.62
11/6/92 7.76
11/13/92 7.56
11/20/92 7.53
11/27/92 7.59
12/4/92 7.49
12/11/92 7.44
12/18/92 7.42
12/25/92 7.36
1/1/93 7.4
1/8/93 7.46
1/15/93 7.35
1/22/93 7.29
1/29/93 7.2
2/5/93 7.16
2/12/93 7.12
2/19/93 7.01
2/26/93 6.89
3/5/93 6.74
3/12/93 6.86
3/19/93 6.81
3/26/93 6.94
4/2/93 7.05
4/9/93 6.85
4/16/93 6.75
4/23/93 6.79
4/30/93 6.92
5/7/93 6.84
5/14/93 6.94
5/21/93 7.03
5/28/93 6.98
6/4/93 6.91
6/11/93 6.81
6/18/93 6.81
6/25/93 6.7
7/2/93 6.66
7/9/93 6.64
7/16/93 6.54
7/23/93 6.7
7/30/93 6.56
8/6/93 6.53
8/13/93 6.35
8/20/93 6.22
8/27/93 6.13
9/3/93 5.94
9/10/93 5.88
9/17/93 6.04
9/24/93 6.05
10/1/93 5.99
10/8/93 5.92
10/15/93 5.79
10/22/93 5.98
10/29/93 5.97
11/5/93 6.21
11/12/93 6.15
11/19/93 6.34
11/26/93 6.26
12/3/93 6.25
12/10/93 6.19
12/17/93 6.28
12/24/93 6.21
12/31/93 6.35
1/7/94 6.23
1/14/94 6.3
1/21/94 6.28
1/28/94 6.22
2/4/94 6.36
2/11/94 6.41
2/18/94 6.63
2/25/94 6.71
3/4/94 6.84
3/11/94 6.9
3/18/94 6.92
3/25/94 7.02
4/1/94 7.25
4/8/94 7.26
4/15/94 7.29
4/22/94 7.23
4/29/94 7.31
5/6/94 7.54
5/13/94 7.49
5/20/94 7.3
5/27/94 7.39
6/3/94 7.27
6/10/94 7.31
6/17/94 7.45
6/24/94 7.52
7/1/94 7.61
7/8/94 7.69
7/15/94 7.54
7/22/94 7.56
7/29/94 7.4
8/5/94 7.48
8/12/94 7.48
8/19/94 7.49
8/26/94 7.7
9/2/94 7.77
9/9/94 7.79
9/16/94 7.82
9/23/94 7.91
9/30/94 7.83
10/7/94 7.98
10/28/94 7.96
11/4/94 8.16
11/11/94 8.15
11/18/94 8.13
11/25/94 7.93
12/2/94 7.91
12/9/94 7.86
12/16/94 7.85
12/23/94 7.83
12/30/94 7.88
1/6/95 7.86
1/13/95 7.79
1/20/95 7.89
1/27/95 7.73
2/3/95 7.63
2/10/95 7.67
2/17/95 7.59
2/24/95 7.53
3/3/95 7.54
3/10/95 7.46
3/17/95 7.37
3/24/95 7.36
3/31/95 7.43
4/7/95 7.39
4/14/95 7.34
4/21/95 7.33
4/28/95 7.34
5/5/95 7.02
5/12/95 6.99
5/19/95 6.92
5/26/95 6.75
6/2/95 6.53
6/9/95 6.73
6/16/95 6.62
6/23/95 6.5
6/30/95 6.62
7/7/95 6.52
7/14/95 6.6
7/21/95 6.96
7/28/95 6.9
8/4/95 6.91
8/11/95 6.99
8/18/95 6.9
8/25/95 6.7
9/1/95 6.62
9/8/95 6.59
9/15/95 6.48
9/22/95 6.58
9/29/95 6.5
10/6/95 6.42
10/13/95 6.3
10/20/95 6.36
10/27/95 6.36
11/3/95 6.28
11/10/95 6.34
11/17/95 6.23
11/24/95 6.25
12/1/95 6.09
12/8/95 6.05
12/15/95 6.1
12/22/95 6.06
12/29/95 5.95
1/5/96 6.04
1/12/96 6.15
1/19/96 5.97
1/26/96 6.04
2/2/96 6.16
2/9/96 6.1
2/16/96 6.24
2/23/96 6.4
3/1/96 6.37
3/8/96 6.71
3/15/96 6.74
3/22/96 6.66
3/29/96 6.67
4/5/96 6.82
4/12/96 6.8
4/19/96 6.79
4/26/96 6.79
5/3/96 7.12
5/10/96 6.93
5/17/96 6.83
5/24/96 6.83
5/31/96 6.99
6/7/96 7.03
6/14/96 7.09
6/21/96 7.1
6/28/96 6.87
7/5/96 7.19
7/12/96 7.03
7/19/96 6.97
7/26/96 7.01
8/2/96 6.74
8/9/96 6.69
8/16/96 6.77
8/23/96 6.96
8/30/96 7.12
9/6/96 7.11
9/13/96 6.95
9/20/96 7.04
9/27/96 6.91
10/4/96 6.74
10/11/96 6.84
10/18/96 6.8
10/25/96 6.82
11/1/96 6.68
11/8/96 6.51
11/15/96 6.46
11/22/96 6.44
11/29/96 6.35
12/6/96 6.51
12/13/96 6.57
12/20/96 6.61
12/27/96 6.56
1/3/97 6.73
1/10/97 6.84
1/17/97 6.82
1/24/97 6.89
1/31/97 6.79
2/7/97 6.7
2/14/97 6.52
2/21/97 6.64
2/28/97 6.8
3/7/97 6.81
3/14/97 6.94
3/21/97 6.97
3/28/97 7.09
4/4/97 7.12
4/11/97 7.17
4/18/97 7.05
4/25/97 7.14
5/2/97 6.87
5/9/97 6.89
5/16/97 6.9
5/23/97 6.99
5/30/97 6.91
6/6/97 6.77
6/13/97 6.72
6/20/97 6.66
6/27/97 6.74
7/4/97 6.63
7/11/97 6.53
7/18/97 6.53
7/25/97 6.45
8/1/97 6.45
8/8/97 6.64
8/15/97 6.55
8/22/97 6.65
8/29/97 6.61
9/5/97 6.64
9/12/97 6.59
9/19/97 6.38
9/26/97 6.37
9/30/97 6.4
10/6/97 6.26
10/13/97 6.43
10/20/97 6.42
10/27/97 6.13
11/3/97 6.21
11/10/97 6.14
11/17/97 6.07
11/24/97 6.07
12/1/97 6.04
12/8/97 6.14
12/15/97 5.97
12/22/97 5.89
12/29/97 5.92
1/5/98 5.74
</TABLE>
In the fourth quarter, currency devaluations in Southeast Asia rocked investment
communities worldwide and market volatility picked up dramatically in late
October. The financial crisis in Asian markets was aggravated by overlending and
the large amount of debt held by many private companies. At the same time,
Japan, which represents a significant percentage of the world markets, showed
renewed signs of a slowdown and this created little relief for international
investors.
As a result of this turbulence, a flight to safety prompted investors to migrate
back to more liquid, large capitalization stocks and to U.S. Treasuries, pushing
the yield of the long bond below 6% for the first time in almost two years.
MARKET OUTLOOK
The U.S. equity markets continue to trade at valuation levels that are
historically high, but many positive factors support these valuations. The Fed
remains vigilant, poised to tighten if economic growth or inflation heat up, but
ready to provide liquidity if the economy slows or international concerns
intensify. The current scenario -- expectations for modest increases in
corporate profits, low inflation and declining interest rates -- is generally
positive for the stock market.
1
<PAGE>
AN OVERVIEW OF THE MARKETS
- --------------------------------------------------------------------------------
At this point, however, we believe that some caution is warranted. Increased
risk in the equity markets is evidenced by continued higher volatility and a
preference for greater liquidity. Concerns are growing that 1998 earnings may
not rise sufficiently to justify current prices. The potential for much slower
growth in emerging countries (particularly in Southeast Asia and Latin America)
is dimming earnings prospects for many multinational companies.
INVESTMENT STRATEGY
We have positioned our equity portfolios to favor domestic growth over cyclical
issues. Areas that merit particular emphasis, we believe, include retail issues,
health care and consumer staple stocks. Continuing strength in consumer
confidence and the low level of inflation support an overweighting in these
issues in spite of somewhat high valuations. We have increased utility stock
holdings to take advantage of their stable relative earnings and high dividend
yields. Energy issues have been deemphasized because of slowing world growth and
falling commodity prices.
CONSUMER CONFIDENCE
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<S> <C>
Jan-80 85.9
Feb-80 85.3
Mar-80 80.8
Apr-80 60.5
May-80 50.1
Jun-80 56.1
Jul-80 65.4
Aug-80 70.8
Sep-80 80.3
Oct-80 84.2
Nov-80 87.2
Dec-80 78.6
Jan-81 74.4
Feb-81 69
Mar-81 77.8
Apr-81 81.6
May-81 86.9
Jun-81 83
Jul-81 83.5
Aug-81 85.7
Sep-81 75.6
Oct-81 66.9
Nov-81 66.6
Dec-81 64.9
Jan-82 62.3
Feb-82 56.7
Mar-82 57
Apr-82 61.4
May-82 56.7
Jun-82 63.2
Jul-82 56.9
Aug-82 58.1
Sep-82 54.3
Oct-82 57.4
Nov-82 59.5
Dec-82 59
Jan-83 67.6
Feb-83 79.4
Mar-83 83.1
Apr-83 87.7
May-83 87.5
Jun-83 89
Jul-83 91.2
Aug-83 91.1
Sep-83 92.1
Oct-83 96.7
Nov-83 103.6
Dec-83 103.9
Jan-84 101
Feb-84 101.1
Mar-84 106.1
Apr-84 104.8
May-84 105.8
Jun-84 100.4
Jul-84 103.1
Aug-84 100
Sep-84 99.1
Oct-84 105.4
Nov-84 97
Dec-84 102
Jan-85 103.1
Feb-85 96.1
Mar-85 104.4
Apr-85 99.6
May-85 102.6
Jun-85 103.2
Jul-85 100.9
Aug-85 96
Sep-85 96.1
Oct-85 98.1
Nov-85 98.2
Dec-85 96.9
Jan-86 96
Feb-86 95.1
Mar-86 100
Apr-86 100.2
May-86 100
Jun-86 97.5
Jul-86 91.7
Aug-86 89.7
Sep-86 85.8
Oct-86 89.7
Nov-86 93.2
Dec-86 85.4
Jan-87 91.8
Feb-87 95.8
Mar-87 97.4
Apr-87 103
May-87 102.1
Jun-87 105.8
Jul-87 110.7
Aug-87 115.7
Sep-87 115.1
Oct-87 100.8
Nov-87 107.7
Dec-87 109.9
Jan-88 114.9
Feb-88 112.7
Mar-88 115.7
Apr-88 120.2
May-88 115.7
Jun-88 113.5
Jul-88 119.7
Aug-88 110.7
Sep-88 116.9
Oct-88 112.9
Nov-88 119.3
Dec-88 115.8
Jan-89 120.7
Feb-89 117.4
Mar-89 116.6
Apr-89 116.7
May-89 117.5
Jun-89 120.4
Jul-89 114.7
Aug-89 116.3
Sep-89 117
Oct-89 115.1
Nov-89 113.1
Dec-89 106.5
Jan-90 106.7
Feb-90 107.9
Mar-90 107.3
Apr-90 102.4
May-90 101.8
Jun-90 84.7
Jul-90 85.6
Aug-90 62.6
Sep-90 61.7
Oct-90 61.2
Nov-90 55.1
Dec-90 59.4
Jan-91 81
Feb-91 79.4
Mar-91 76.4
Apr-91 78
May-91 78
Jun-91 77.7
Jul-91 76.1
Aug-91 72.9
Sep-91 60.1
Oct-91 52.7
Nov-91 52.7
Dec-91 52.5
Jan-92 50.4
Feb-92 47.3
Mar-92 56.5
Apr-92 65.1
May-92 71.9
Jun-92 72.6
Jul-92 61.2
Aug-92 59
Sep-92 57.3
Oct-92 54.6
Nov-92 65.6
Dec-92 78.1
Jan-93 76.7
Feb-93 68.5
Mar-93 63.2
Apr-93 67.6
May-93 61.9
Jun-93 58.6
Jul-93 59.2
Aug-93 59.3
Sep-93 63.8
Oct-93 60.5
Nov-93 71.9
Dec-93 79.8
Jan-94 82.6
Feb-94 79.6
Mar-94 86.7
Apr-94 92.1
May-94 88.9
Jun-94 92.5
Jul1994 91.3
Aug-94 90.4
Sep-94 89.5
Oct1994 89.1
Nov-94 100.4
Dec-94 103.4
Jan-95 101.4
Feb-95 99.4
Mar-95 100.2
Apr-95 104.6
May-95 102
Jun-95 92.8
Jul-95 101.4
Aug-95 102.4
Sep-95 97.3
Oct-95 96.3
Nov-95 101.6
Dec-95 99.2
Jan-96 88.4
Feb-96 98
Mar-96 98.4
Apr-96 104.8
May-96 103.5
Jun-96 100.1
Jul-96 107
Aug-96 112
Sep-96 111.8
Oct-96 107.3
Nov-96 109.5
Dec-96 114.2
Jan-97 118.7
Feb-97 118.9
Mar-97 118.5
Apr-97 118.5
May-97 127.9
Jun-97 129.9
Jul-97 126.3
Aug-97 127.6
Sep-97 130.2
Oct-97 123.3
Nov-97 128.3
Dec-97 134.5
</TABLE>
REIT valuations remain attractive relative to the broader market, and
expectations for double-digit total returns are not unreasonable, with lower
volatility than the S&P.
As we look to the year ahead, we continue to believe that economic indicators
support prospects for a healthy economy. However, peaking profit margins and
slowing world growth should, we believe, lead to moderating corporate earnings
growth. We anticipate the recent high level of market volatility to continue, so
we remain focused on companies that are expected to maintain competitive
strength in their industries and deliver dependable earnings growth.
So that you may evaluate how the Columbia Funds performed given this economic
and financial market backdrop, the following pages contain discussions of the
Funds' investment activity during 1997, along with graphs illustrating the
growth of $10,000 over various time periods. Each Fund compares its performance
to a relevant benchmark. Unlike the Funds, however, these benchmark indices are
not actively managed and have no operating expenses, portfolio transaction costs
or cash flows.
Thank you for your investment in Columbia Funds. We appreciate your confidence,
and look forward to serving your investment needs in the years to come.
THE INVESTMENT TEAM
COLUMBIA FUNDS MANAGEMENT COMPANY
FEBRUARY 1998
2
<PAGE>
INVESTMENT REVIEW
- --------------------------------------------------------------------------------
- ---- ----
-- COLUMBIA COMMON STOCK FUND --
--------------------------------
For the third consecutive year, Columbia Common Stock Fund delivered gains in
excess of 20% by posting a total return of 25.37% for 1997. The strongest
performing sectors included banking and finance, consumer staples and retailers.
Sectors that did not perform as well included energy, REITs and cyclicals like
paper and metals.
After maintaining a steady weighting in cyclical stocks, we adopted a growth
strategy early in the fourth quarter, in anticipation of a slowing economy. To
that end, stocks in the building, forest product, metal and chemical sectors
were reduced from a total of 16% of the portfolio to 3%. We also reduced
positions in energy and technology stocks. Consumer staples, health care and
utilities, on the other hand, were increased.Our investment strategy assumes
that profit growth in 1998 will be more difficult for domestic companies to
attain. With low inflation and low interest rates, price earnings ratios will
most likely hold steady for companies delivering good earnings growth. We also
believe that market volatility, which has been below average over the last few
years, will likely increase to more normal historical levels, making it more
important to manage risk and to identify companies with the most reliable growth
prospects. With this in mind, we are focusing on areas that are expected to
benefit from steady earnings in a slow growth environment.
With a median market cap of $10.6 billion, Columbia Common Stock Fund is well
diversified with over 78 different issues at year-end. The Fund continues to
seek growth of capital and dividend income by using a top down, sector rotation
strategy to select stocks of large, well-established companies.
SECTORS OF EMPHASIS
<TABLE>
<CAPTION>
% of Net Assets
<S> <C>
Consumer Staples 16.8
Health Care 12.6
Consumer Non-Durables 11.5
Finance 10.0
Technology 8.6
Energy & Energy Services 7.9
</TABLE>
As of December 31, 1997
GROWTH OF $10,000 SINCE INCEPTION
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
COLUMBIA COMMON STOCK FUND S&P 500
<S> <C> <C>
10/1/91 $10,000 $10,000
12/31/91 $11,025 $10,838
12/31/92 $12,126 $11,664
12/31/93 $14,120 $12,840
12/31/94 $14,411 $13,009
12/31/95 $18,855 $17,898
12/31/96 $22,760 $22,007
12/31/97 $28,531 $29,350
Average Annual Total Returns
As of December 31, 1997
CCSF S&P 500
1 Year 25.37% 33.36%
5 Years 18.66% 20.27%
Since Inception 18.11% 18.64%
Past Performance is not predictive of future
performance.
</TABLE>
3
<PAGE>
INVESTMENT REVIEW
- --------------------------------------------------------------------------------
- ---- ----
-- COLUMBIA GROWTH FUND --
--------------------------
Columbia Growth Fund gained 26.32% for the year ended December 31, 1997. Drug,
bank, insurance and consumer growth stocks contributed to positive performance
during the year, while REITs, health care service, and most technology stock
returns lagged.
The Fund's overall positive performance was attributable to rising P/Es due to
lower inflation expectations and good corporate earnings growth. In 1997, the
Fund's return lagged the S&P 500 Stock Index where a relatively small number of
the largest capitalization stocks in the Index posted superior performance
compared to the broader market. Nevertheless, we remain confident that
fundamentals of the stocks in Columbia Growth Fund -- lower valuations and
superior earnings growth -- are more attractive than the larger company stocks
in the Index, and will reward shareholders of the Fund.
TOP TEN HOLDINGS
<TABLE>
<CAPTION>
% of Net Assets
<S> <C>
Cendant Corp. 3.2
Warnaco Group, Inc. (Class A) 3.1
Tyco International Ltd. 2.8
Cisco Systems, Inc. 2.5
Gillette Co. 2.4
Rite Aid Corp. 2.4
Philip Morris Cos., Inc. 2.1
Tandy Corp. 2.0
American General Corp. 2.0
Merck & Co., Inc. 2.0
</TABLE>
<TABLE>
<CAPTION>
AS OF DECEMBER 31, 1997
<S> <C>
</TABLE>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
We expect corporate earnings growth to slow as profit margins peak and as demand
slows due to economic and currency turmoil in Southeast Asia. Events in that
region have lowered inflation expectations even further, however. Therefore,
interest rates could stay at current low levels, helping to support the
relatively high valuations seen in the stock market.
With a view toward less earnings growth and lower interest rates, we are
emphasizing stocks from companies with relatively stable growth. With the Asian
situation negatively affecting exporters, as well as those companies that
compete with imports and that do business in Asia, we expect superior growth to
come from more domestically-oriented companies and those multinational companies
selling such nondurable items as drugs and various household items.
With a median market cap of $9.6 billion, Columbia Growth Fund continues to be
well diversified with 81 different holdings as of December 31, 1997.
SECTORS OF EMPHASIS
<TABLE>
<CAPTION>
% of Net Assets
<S> <C>
Finance 18.8
Consumer Non-Durables 16.7
Consumer Staples 14.8
Health 13.0
Technology 12.9
</TABLE>
<TABLE>
<CAPTION>
AS OF DECEMBER 31, 1997
<S> <C>
</TABLE>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
GROWTH OF $10,000 OVER 20 YEARS
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
COLUMBIA GROWTH FUND S&P 500
<S> <C> <C>
12/31/77 $10,000 $10,000
12/31/78 $10,804 $10,643
12/31/79 $15,187 $12,596
12/31/80 $21,244 $16,671
12/31/81 $20,524 $15,846
12/31/82 $30,079 $19,252
12/31/83 $36,535 $23,569
12/31/84 $34,496 $25,021
12/31/85 $45,559 $32,917
12/31/86 $48,711 $39,053
12/31/87 $55,891 $41,111
12/31/88 $61,933 $47,915
12/31/89 $79,950 $63,061
12/31/90 $77,303 $61,137
12/31/91 $103,788 $79,766
12/31/92 $116,055 $85,844
12/31/93 $131,154 $94,497
12/31/94 $130,328 $95,744
12/31/95 $173,310 $131,725
12/31/96 $209,358 $161,969
12/31/97 $264,496 $215,955
Average Annual Total Returns
As of December 31, 1997
CGF S&P 500
1 Year 26.32% 33.36%
5 Years 17.91% 20.27%
10 Years 16.81% 18.04%
20 Years 17.79% 16.61%
Past Performance is not predictive of future
performance.
</TABLE>
4
<PAGE>
INVESTMENT REVIEW
- --------------------------------------------------------------------------------
- ---- ----
-- COLUMBIA INTERNATIONAL STOCK FUND --
---------------------------------------
The Columbia International Stock Fund enjoyed strength in the first half of the
year, where gains were fueled by double-digit returns in Europe, Brazil, India,
Taiwan and Korea. The second half of the year grew turbulent, however, as a
result of volatile and weak Asian markets, and the Fund recorded a 1997 total
return of 11.47%.
On early signs of turmoil in Southeast Asia, we sold positions in Korea,
Malaysia, Hong Kong, and Taiwan in the third quarter, but the Fund was still
negatively impacted. By October, the Asian financial crisis had spread to Hong
Kong, and many major stock markets weakened, including Japan, which showed
further signs of economic malaise. Led by the United States, however, most of
these markets recovered to end the year on a more positive note.
Despite a weak international market, Columbia International Stock Fund
outperformed its benchmark for the period. Not only did the Fund underweight
Japan, but stock selection
TOP TEN HOLDINGS
<TABLE>
<CAPTION>
% of Net Assets
<S> <C>
Novartis, AG 2.3
Sony Corp. 1.7
Aegon NV 1.6
Tubos de Acero de Mexico SA 1.5
SmithKline Beecham plc 1.4
Glaxo Wellcome plc 1.4
Compass Group plc 1.3
Fuji Photo Film Co., Ltd. 1.3
NTT Data Communications System Corp. 1.3
Nintendo, Co., Ltd. 1.2
</TABLE>
<TABLE>
<CAPTION>
AS OF DECEMBER 31, 1997
<S> <C>
</TABLE>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
emphasized exporting companies such as electronics and autos, which enabled the
Fund's Japanese holdings to outperform the overall Japanese market. Also, above-
market weightings in several smaller European markets (Sweden, Norway, Spain and
Italy) helped performance. With the European Monetary Union underway (a movement
toward one currency), European markets remain attractive as bond yields converge
and many countries experience huge declines in interest rates.
We approach the new year with uncertainty about when the Asian financial crisis
will be resolved. Nevertheless, many global markets show promise. Europe's
recovery is gaining momentum and we look for more domestic policy change in
Japan that should aid the entire Asian region. The Fund will continue its
objective of seeking long-term capital appreciation by investing primarily in
stocks of companies based outside the U.S. with at least 75% of the portfolio
invested in companies with market valuations over $500 million.
TOP TEN
COUNTRY WEIGHTINGS
<TABLE>
<CAPTION>
% of Net Assets
<S> <C>
Japan 22.2
United Kingdom 16.4
France 8.0
Germany 6.2
Netherlands 4.2
Sweden 3.9
Mexico 3.8
Spain 3.6
Canada 3.3
India 3.1
</TABLE>
<TABLE>
<CAPTION>
AS OF DECEMBER 31, 1997
<S> <C>
</TABLE>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
GROWTH OF $10,000 SINCE INCEPTION
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
COLUMBIA
INTERNATIONAL FT/S&P
STOCK FUND EURO-PAC S&P 500
<S> <C> <C> <C>
10/1/92 $10,000 $10,000 $10,000
12/31/92 $10,060 $9,628 $10,503
12/31/93 $13,417 $12,665 $11,562
12/31/94 $13,086 $13,822 $11,714
12/31/95 $13,760 $15,290 $16,117
12/31/96 $16,042 $16,180 $19,817
12/31/97 $17,881 $16,144 $26,428
Average Annual Total Returns
As of December 31, 1997
CISF S&P 500 FT/S&P Euro-Pac
1 Year 11.47% 33.36% -0.22%
5 Years 12.19% 20.27% 10.89%
Since Inception 11.59% 20.13% 9.46%
Past Performance is not predictive of future
performance.
</TABLE>
5
<PAGE>
INVESTMENT REVIEW
- --------------------------------------------------------------------------------
- ---- ----
-- COLUMBIA SPECIAL FUND --
---------------------------
The Special Fund generated a total return of 12.64% for the 1997 year. During
the fourth quarter, small- and mid-cap stocks underperformed the large-cap S&P
500 Stock Index. This came after an unusually strong third quarter of
outperformance, which was fueled by a market rotation away from highly valued
large cap stocks.
The Fund's performance was adversely affected during the year by an early
emphasis in the paper and metal sectors. We believed that these economically
sensitive industries would offer value by benefiting from stronger than expected
economic growth. In addition, we chose to de-emphasize finance stocks throughout
the year in anticipation that these fully priced securities would disappoint if
interest rates increased due to the strong
TOP TEN HOLDINGS
<TABLE>
<CAPTION>
% of Net Assets
<S> <C>
American Stores Co. 3.3
Safeway, Inc. 3.0
Kroger, Co. 3.0
Meyer (Fred), Inc. 2.9
Nordstrom, Inc. 2.5
Service Corp, International 2.4
ESC Medical Systems Ltd. 2.2
FIserv, Inc. 2.2
Quality Food Centers, Inc. 2.1
Abercrombie & Fitch Co. (Class A) 2.0
</TABLE>
<TABLE>
<CAPTION>
AS OF DECEMBER 31, 1997
<S> <C>
</TABLE>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
world economic growth. The demand for basic materials was reduced by the
international slowdown, and this prompted a decline in domestic and foreign
interest rates. In turn, investors fled from companies with less predictable
earnings to those with more consistent growth.
As the year came to a close, we sharply reduced our weightings in paper, metals
and machinery from a total of 24% of the portfolio to 7%. We increased areas of
steady growth like business and consumer services, consumer staples and health
care from 30% of the portfolio to 46%. We also added to REITs and are currently
maintaining a below-market weighting in technology.
The long-term strategy of the Special Fund has always been to maintain a core of
growth stocks while anticipating and recognizing changes in the market. This has
enabled us to invest in sectors and themes that benefit from these changes. As
we begin 1998, we are emphasizing consistent growth stocks, domestic companies,
and risk management. This supports our outlook for low inflation, a reduced rate
of corporate profit growth and the likelihood of greater stock market
volatility.
SECTORS OF EMPHASIS
<TABLE>
<CAPTION>
% of Net Assets
<S> <C>
Consumer Non-Durables 25.0
Consumer Staples 16.3
Business & Consumer Services 15.7
Health Care 14.0
</TABLE>
<TABLE>
<CAPTION>
AS OF DECEMBER 31, 1997
<S> <C>
</TABLE>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
GROWTH OF $10,000 OVER 10 YEARS
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
COLUMBIA
SPECIAL
FUND S&P 500 RUSSELL 2000
<S> <C> <C> <C>
12/31/87 $10,000 $10,000 $10,000
12/31/88 $14,255 $11,655 $12,502
12/31/89 $18,805 $15,339 $14,535
12/31/90 $16,475 $14,871 $11,699
12/31/91 $24,789 $19,403 $17,094
12/31/92 $28,185 $20,881 $20,240
12/31/93 $34,295 $22,986 $24,062
12/31/94 $35,080 $23,289 $23,624
12/31/95 $45,440 $32,041 $30,345
12/31/96 $51,379 $39,398 $35,349
12/31/97 $57,879 $52,533 $43,254
Average Annual Total Returns
As of December 31, 1997
CSF S&P 500 Russell 2000
1 Year 12.64% 33.36% 22.36%
5 Years 15.48% 20.27% 16.40%
Since Inception 19.19% 18.04% 15.77%
Past Performance is not predictive of future
performance.
</TABLE>
6
<PAGE>
INVESTMENT REVIEW
- --------------------------------------------------------------------------------
- ---- ----
-- COLUMBIA SMALL CAP FUND --
-----------------------------
For 1997, Columbia Small Cap Fund generated a total return of 34.10%,
outperforming both the S&P 500 and the Russell 2000. After particularly strong
performance in the second and third quarters, however, the Fund suffered in the
fourth quarter when small cap stocks sputtered in response to increased stock
market volatility.
Investment themes benefiting the portfolio during the year included a focus on
specialty retailers based on a high level of consumer confidence and spending.
We also emphasized the assisted living sector as part of our emphasis on the
aging of America. Another successful strategy was to invest in stocks of well-
drilling and oil equipment supply industries, which provided handsome returns.
TOP TEN HOLDINGS
<TABLE>
<CAPTION>
% of Net Assets
<S> <C>
CKE Restaurants, Inc. 2.3
Laser Industries Ltd. 2.1
North Fork Bancorp, Inc. 2.0
Tubos de Acero de Mexico SA ADR 2.0
CIBER, Inc. 1.9
Williams-Sonoma, Inc. 1.9
ATL Ultrasound, Inc. 1.8
Orbital Sciences Corp. 1.7
Engineering Animation, Inc. 1.7
Universal Health Services, Inc. (Class B) 1.6
</TABLE>
<TABLE>
<CAPTION>
AS OF DECEMBER 31, 1997
<S> <C>
</TABLE>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
During the fourth quarter, turmoil in Southeast Asian economies prompted
investors to seek a safe haven in larger, more liquid stocks.
The demand for liquidity depressed small cap valuations and thus stock prices.
We responded by selling stocks we believed were fully valued and susceptible to
correction, along with those we deemed most vulnerable to negative earnings
revisions from the Asian crisis. These areas included energy and certain
segments of the technology sector. Meanwhile, we increased our health care
exposure due to this sector's more stable domestic revenue base and insulation
from the economy.
Looking ahead, we believe that relative valuations and earnings growth prospects
in the small cap market are attractive based on historical ranges. In the
meantime, the Fund continues to employ fundamental research to identify
attractively valued, small companies with above average earnings potential.
Using a bottoms up approach to stock selection, the Fund had a diversified
portfolio of 101 issues at year-end and a median market capitalization of $551
million.
SECTORS OF EMPHASIS
<TABLE>
<CAPTION>
% of Net Assets
<S> <C>
Health Care 27.7
Technology 24.3
Consumer Non-Durables 10.2
Business & Consumer Services 8.0
Energy & Energy Services 6.1
Finance 6.1
</TABLE>
<TABLE>
<CAPTION>
AS OF DECEMBER 31, 1997
<S> <C>
</TABLE>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
GROWTH OF $10,000 SINCE INCEPTION
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
COLUMBIA
SMALL CAP
FUND RUSSELL 2000
<S> <C> <C>
10/1/96 $10,000 $10,000
12/31/96 $10,762 $10,520
3/31/97 $10,224 $9,976
6/30/97 $12,245 $11,593
9/30/97 $15,021 $13,318
12/31/97 $14,432 $12,872
Average Annual Total Returns
As of December 31, 1997
CSCF Russell 2000
1 Year 34.10% 22.36%
Since Inception 35.76% 23.42%
Past Performance is not predictive of future
results.
</TABLE>
7
<PAGE>
INVESTMENT REVIEW
- --------------------------------------------------------------------------------
- ---- ----
-- COLUMBIA REAL ESTATE EQUITY FUND --
--------------------------------------
Columbia Real Estate Equity Fund posted a total return of 24.74% for the year
ended December 31, 1997. Real estate investment trusts (REITs) corrected early
in the second quarter, along with the rest of the stock market, as investors
adjusted to the March 25th rate hike by the Federal Reserve Board. Second
quarter money flows into REITs subsequently slowed as investors turned their
attention to the rebounding S&P 500.
In the third quarter, momentum in the REIT sector resumed, and performance was
led by investments in the office, hotel and industrial sectors. We maintained an
overweighting in these areas as their internal and acquisition growth
fundamentals suggested positive future performance.
TOP TEN HOLDINGS
<TABLE>
<CAPTION>
% of Net Assets
<S> <C>
Equity Office Properties Trust 6.4
Mack-Cali Realty Corp. 5.1
Security Capital Group, Inc. (Class B) 4.4
Security Capital Pacific Trust 4.1
Vornado Realty Trust 4.1
First Industrial Realty Trust, Inc. 3.7
Apartment Investment & Mgmt Co. (Class
A) 3.7
Liberty Property Trust 3.5
Catellus Development Corp. 3.5
General Growth Properties, Inc. 3.4
</TABLE>
<TABLE>
<CAPTION>
AS OF DECEMBER 31, 1997
<S> <C>
</TABLE>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
A below-market weighting in health care and lagging performance in the office
sector penalized the portfolio in the fourth quarter.
Overall, investor interest in REITs grew significantly in 1997. Money flows into
REIT mutual funds were healthy, approaching $5 billion for the year. In
addition, market capitalization for the REIT sector jumped 60% to stand at $145
billion by year-end.
In an environment where the earnings growth of the broader market is coming into
question and S&P 500 dividend yields are at historic lows, we believe that REITs
offer attractive total return potential for investors looking to diversify their
portfolios.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
PORTFOLIO COMPOSITION
<S> <C>
Apartments 16.2%
Community Centers 11.9%
Industrial 25.6%
Lodging 2.9%
Manufactured Homes 3.0%
Office 17.2%
Shopping Malls 7.8%
Other 7.9%
Cash 7.5%
as of December 31, 1997
</TABLE>
GROWTH OF $10,000 SINCE INCEPTION
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
COLUMBIA NATIONAL ASSOCIATION
REAL ESTATE OF REAL ESTATE
EQUITY FUND INVESTMENT TRUSTS
<S> <C> <C>
4/1/94 $10,000 $10,000
12/31/94 $10,176 $9,978
12/31/95 $11,892 $11,502
12/31/96 $16,446 $15,558
12/31/97 $20,515 $18,710
Average Annual Total Returns
As of December 31, 1997
CREF NAREIT
1 Year 24.74% 20.26%
Since Inception 20.82% 17.92%
Past Performance is not predictive of future
performance.
</TABLE>
8
<PAGE>
INVESTMENT REVIEW
- --------------------------------------------------------------------------------
- ---- ----
-- COLUMBIA BALANCED FUND --
----------------------------
Columbia Balanced Fund returned 18.74% for the 1997 year. While large company
stocks led the market in the first half, we maintained a market underweighting
in them because we believed much of their price appreciation was unrelated to
improving fundamentals. Not surprisingly, large company stocks corrected in the
third quarter, as investors questioned the continued earnings growth of this
richly valued sector. In the fourth quarter, however, market turmoil in
Southeast Asia prompted investors to migrate back to large company stocks in
search of greater liquidity.
Overall, the equity portion of the portfolio benefited from holdings in
financial services (Freddie Mac), diversified manufacturing (General Electric
and Tyco Intl.), and consumer goods and services (Mattel and Service Corp.
Intl.), due to their relative immunity to economic turmoil outside the U.S.
TOP TEN STOCK HOLDINGS
<TABLE>
<CAPTION>
% of Net Assets
<S> <C>
General Electric Co. 1.6
Merck & Co. 1.6
Freddie Mac 1.6
Mattel, Inc. 1.4
First Union Corp. 1.3
Tyco International Ltd. 1.3
Lilly (Eli) & Co. 1.3
Service Corp. International 1.2
Sunbeam Corp. 1.1
Bristol-Myers Squibb Co. 1.1
</TABLE>
As of December 31, 1997
Economically sensitive cyclical stocks were influenced by volatile activity
overseas, and portfolio holdings in these sectors suffered. Growth slowed
worldwide, particularly in a number of natural resource-hungry developing
countries.
Concern about lower commodity prices led the Fund to reduce exposure to energy,
forest products and chemical industries. In light of the rapid economic slowdown
in Southeast Asia, technology holdings were scaled back late in the year,
reflecting a growing concern about earnings expectations.
9
<PAGE>
INVESTMENT REVIEW
- --------------------------------------------------------------------------------
- ---- ----
-- COLUMBIA DAILY INCOME COMPANY --
-----------------------------------
Columbia Daily Income Company generated a total return of 5.11% for the twelve
months ended December 31, 1997. This rate of return compares favorably to the
rate of inflation as measured by the Consumer Price Index (1.7%).
During the year, the Fund's 7-day average yield rose from 4.87% in January to
5.21% at year-end. While long-term interest rates declined during the year,
money market rates rose slightly due to the Federal Reserve Board's .25%
increase in the Federal Funds rate in March. In addition, the supply of short-
term instruments later in the year was particularly strong, driving up the
yields on money market instruments in December.
PORTFOLIO HIGHLIGHTS
<TABLE>
<S> <C>
Current Yield 5.21%
Compound Yield 5.35%
</TABLE>
Based on the 7 days ended December 31, 1997
<TABLE>
<S> <C>
Weighted Average Maturity 31.4 days
</TABLE>
As of December 31, 1997
Because of the subdued rate of inflation, the Federal Reserve Board has left
short-term rates untouched since March 25, despite a steadily growing economy.
The outlook for short-term rates remains unchanged for the next few months.
As always, Columbia Daily Income Company invests only in high quality, short-
term debt instruments with an average maturity of 30 to 50 days, providing a
very liquid, low risk investment. The Fund seeks to provide the highest level of
income available that is consistent with the maintenance of liquidity and
preservation of capital by investing in various money market instruments. These
include commercial paper, U.S. Treasury Bills, U.S. Government agency discount
notes and certificates of deposit.
AT THIS TIME, MONEY MARKET YIELDS ARE VERY ATTRACTIVE RELATIVE
TO THE EXPECTED RATE OF INFLATION.
GROWTH OF $10,000 OVER 10 YEARS
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
COLUMBIA DAILY INCOME COMPANY CONSUMER PRICE INDEX (INFLATION)
<S> <C> <C>
12/31/87 $10,000 $10,000
12/31/88 $10,707 $10,407
12/31/89 $11,659 $10,922
12/31/90 $12,573 $11,630
12/31/91 $13,285 $11,960
12/31/92 $13,716 $12,358
12/31/93 $14,061 $12,648
12/31/94 $14,578 $12,981
12/31/95 $15,378 $13,323
12/31/96 $16,141 $13,770
12/31/97 $16,967 $13,957
Average Annual Total Returns as of December 31, 1997
CDIC CPI
1 Year 5.11% 1.70%
5 Years 4.35% 2.58%
10 Years 5.43% 3.39%
Past Performance is not predictive of future results.
</TABLE>
10
<PAGE>
INVESTMENT REVIEW
- --------------------------------------------------------------------------------
- ---- ----
-- U.S. GOVERNMENT SECURITIES FUND --
-------------------------------------
For the year ended 1997, Columbia U.S. Government Securities Fund had a total
return of 5.76%. This rate of return compares very favorably to the rate of
inflation as measured by the Consumer Price Index, which has increased only 1.7%
for the twelve months ended December 31, 1997.
Investors' interest in fixed income securities was renewed during the year, as
it became
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
PORTFOLIO COMPOSITION
<S> <C>
Treasury/Agency Obligations 98.1%
Cash 1.9%
as of December 31, 1997
</TABLE>
clear that the stock market was growing increasingly volatile and that a
modestly growing economy was not being accompanied by a strong threat of
inflation.
Continued economic growth combined with low inflation has caused the Federal
Reserve Board to keep interest rates unchanged since March 25th. With market
turmoil in Southeast Asia, short-term Treasuries, such as those held by the
Fund, are often viewed as a safe haven for investors.
PORTFOLIO HIGHLIGHTS
<TABLE>
<S> <C>
Current Yield 4.92%
</TABLE>
Based on the 30 days ended December 31, 1997
<TABLE>
<S> <C>
Weighted Averages
Duration 1.76
years
Maturity 1.9
years
</TABLE>
As of December 31, 1997
GROWTH OF $10,000 OVER 10 YEARS
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
COLUMBIA MERRILL
U.S. LYNCH CONSUMER
GOVERNMENT 1-3 PRICE
SECURITIES TREASURY INDEX
FUND INDEX (INFLATION)
<S> <C> <C> <C>
12/31/87 $10,000 $10,000 $10,000
12/31/88 $10,534 $10,623 $10,407
12/31/89 $11,548 $11,778 $10,922
12/31/90 $12,621 $12,924 $11,630
12/31/91 $14,227 $14,433 $11,960
12/31/92 $15,053 $15,342 $12,324
12/31/93 $15,943 $16,172 $12,648
12/31/94 $15,938 $16,265 $12,981
12/31/95 $17,565 $18,054 $13,323
12/31/96 $18,242 $18,953 $13,770
12/31/97 $19,295 $20,211 $13,957
Average Annual Total Returns as of December 31, 1997
CUSG Merrill 1-3
1 Year 5.76% 6.66%
5 Years 5.09% 5.67%
10 Years 6.79% 7.29%
Past Performance is not predictive of future results.
</TABLE>
11
<PAGE>
INVESTMENT REVIEW
- --------------------------------------------------------------------------------
- ---- ----
-- COLUMBIA FIXED INCOME SECURITIES FUND --
-------------------------------------------
For 1997, Columbia Fixed Income Securities Fund posted a total return of 9.56%.
Although bonds suffered early in the year under pressures of a rapidly growing
economy and rising interest rates, the bond market closed the year with a
powerful rally triggered by market turmoil in Southeast Asia.
After a volatile first quarter, bonds responded positively in the second and
third quarters to a moderately growing economy with little sign of inflation. As
worldwide stock market volatility intensified in the fourth quarter, investors
sought refuge in fixed income. To take advantage of the changing dynamics in
this arena, we initiated several shifts in asset allocation. For instance, the
yield differential between mortgages and Treasuries fluctuated periodically
throughout the year, providing us with opportunities to increase mortgage
weightings when prices were low, and decrease mortgage weightings (take profits)
when prices crept up. As interest rates dropped in the fourth quarter, we
reduced the average coupon (fixed interest rate paid on bonds) of mortgage
securities in order to stave off any price deterioration resulting from
homeowners refinancing their mortgages (prepayment risk).
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
PORTFOLIO COMPOSITION
<S> <C>
Collateralized Mortgage Obligations 47.5%
Corporate Bonds 25.9%
Treasury/Agency Obligations 14.2%
Mortgage Pass-Throughs 4.3%
Asset Backed Securities 3.0%
Cash 5.1%
as of December 31, 1997
</TABLE>
The corporate bond sector became attractive when their prices declined relative
to Treasuries. We then increased the corporate bond weighting by approximately
3% in the fourth quarter, mostly in the finance sector. Short-term asset-backed
securities, such as home equity loans, performed quite well in the fourth
quarter, and we took profits in this sector.
The Fund invests in a broad range of fixed income securities. At least 95% of
assets are invested in debt securities rated Baa or higher, although the vast
majority is usually invested in securities rated A or higher. The average target
maturity and duration of the Fund are approximately 5.5 years and 4.6 years,
respectively, which is slightly longer than the Fund's benchmark, the Lehman
Aggregate Bond Index.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
PORTFOLIO QUALITY
<S> <C>
Treasury/Agency Obligations 58.8%
Aaa 14.9%
Aa 3.3%
A 9.2%
Baa 10.8%
Other 3.0%
as of December 31, 1997
as rated by Moody's Investor Services,
Inc.
</TABLE>
GROWTH OF $10,000 OVER 10 YEARS
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
COLUMBIA CONSUMER
FIXED INCOME LEHMAN PRICE INDEX
SECURITIES FUND AGGREGATE (INFLATION)
<S> <C> <C> <C>
12/31/87 $10,000 $10,000 $10,000
12/31/88 $10,772 $10,789 $10,407
12/31/89 $12,318 $12,357 $10,922
12/31/90 $13,340 $13,464 $11,630
12/31/91 $15,587 $15,618 $11,960
12/31/92 $16,832 $16,774 $12,324
12/31/93 $18,594 $18,409 $12,648
12/31/94 $17,970 $17,872 $12,981
12/31/95 $21,368 $21,173 $13,323
12/31/96 $22,088 $21,941 $13,770
12/31/97 $24,196 $24,059 $13,957
Average Annual Total Returns
As of December 31, 1997
CFIS Lehman Aggregate
1 Year 9.56% 9.65%
5 Years 7.53% 7.48%
10 Years 9.24% 9.18%
Past Performance is not predictive of future
performance.
</TABLE>
12
<PAGE>
INVESTMENT REVIEW
- --------------------------------------------------------------------------------
- ---- ----
-- COLUMBIA MUNICIPAL BOND FUND --
----------------------------------
Columbia Municipal Bond Fund returned 8.36% for the twelve months ended December
31, 1997. During the first half of the year, fixed income securities experienced
price volatility as first quarter economic growth exceeded expectations and the
Federal Reserve Board hiked short-term interest rates by .25% to ward off
inflation. Bonds recovered from this volatility in the second quarter, and
continued to appreciate in the third quarter as moderate growth persisted with
little sign of inflation. As a result, interest rates on long-term municipal
securities fell approximately .20% by September 30.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
PORTFOLIO COMPOSITION
<S> <C>
State of Oregon General Obligations 8.5%
Oregon General Obligation Bonds 19.6%
Oregon Revenue Bonds 14.7%
Oregon Other Bonds 2.6%
Other Bonds 7.2%
Oregon Insured Bonds 35.4%
Oregon Pre-Refunded Bonds 9.1%
Cash 2.9%
as of December 31, 1997
</TABLE>
In the fourth quarter, volatility in the international markets prompted a flight
to high quality U.S. Treasuries, further driving bond prices up and yields down.
With concern about a delayed recovery in Southeast Asia, investors have lowered
their expectations for corporate earnings growth in 1998. These concerns,
combined with low reported inflation and a reduced federal budget deficit (which
will
lower the supply of Treasuries going forward), sent Treasury and municipal
yields to lower levels by year-end. Yields on municipal securities fell another
.20% during the fourth quarter, pushing down 30-year municipal bonds to their
lowest yields in 10 years.
The supply of new Oregon bonds remains low, as voters hesitate to approve new
taxes. With low interest rates, however, we anticipate that the supply of new
Oregon bonds will increase as older issues are refunded and issuers take
advantage of lower rates.
In trading activity during the year, we endeavored to replace short-term, pre-
refunded bonds with longer term, higher yielding bonds to lock in higher rates
in a declining interest rate environment. At year-end, the average maturity of
the Fund's portfolio was intermediate term, at 11 to 12 years, and its duration
was approximately 6.5 years. As always, the Fund maintains a high average credit
quality and is broadly diversified within the State. We remain committed to
providing shareholders with high, after tax returns combined with a low level of
credit risk and low volatility.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
PORTFOLIO QUALITY
<S> <C>
Aaa 55.3%
Aa 24.4%
A 14.0%
Baa 1.0%
Not Rated 5.3%
as of December 31, 1997
as rated by Moody's Investor Services,
Inc.
</TABLE>
GROWTH OF $10,000 OVER 10 YEARS
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
COLUMBIA LEHMAN GENERAL CONSUMER
MUNICIPAL OBLIGATION PRICE INDEX
BOND FUND INDEX (INFLATION)
<S> <C> <C> <C>
12/31/87 $10,000 $10,000 $10,000
12/31/88 $11,019 $10,767 $10,407
12/31/89 $12,005 $11,856 $10,922
12/31/90 $12,832 $12,658 $11,630
12/31/91 $14,338 $14,101 $11,960
12/31/92 $15,264 $15,338 $12,324
12/31/93 $16,902 $17,137 $12,648
12/31/94 $16,111 $16,335 $12,981
12/31/95 $18,390 $18,975 $13,323
12/31/96 $19,084 $19,874 $13,770
12/31/97 $20,680 $21,629 $13,957
Average Annual Total Returns
As of December 31, 1997
CMBF Lehman G.O.
1 Year 8.36% 8.80%
5 Years 6.26% 7.11%
Since Inception 7.54% 8.02%
Past Performance is not predictive of future
performance.
</TABLE>
13
<PAGE>
INVESTMENT REVIEW
- --------------------------------------------------------------------------------
- ---- ----
-- COLUMBIA HIGH YIELD FUND --
------------------------------
[LOGO]
The Fund posted a total return of 12.70% for the twelve months ended December
31, 1997. Early in the year, the fixed income market suffered from a rapidly
expanding economy and rising interest rates. But as bond investors began to
realize that growth would not be accompanied by higher inflation, bond prices
appreciated throughout the year. As in 1996, the high yield sector of the bond
market again outperformed investment-grade bonds in 1997. This caps off several
consecutive years of solid performance by high yield bonds, thanks to positive
fundamentals and growing investor interest. In 1997, for example, the high yield
market grew by over 26% with $135 billion in new issues coming to market from
over 700 issuers. Flow of money into high yield funds rose by 42% during the
year to $22 billion, as investors continued to view high yield bonds as
excellent tools for diversification.
In trading activity, positive fundamentals led us to emphasize the media sector
throughout much of the
SECTORS OF EMPHASIS
<TABLE>
<CAPTION>
% of Net Assets
<S> <C>
Business Services 3.9
Chemicals 2.0
Metals/Mining 2.0
Hotels/Gaming 4.8
Health Care 7.0
</TABLE>
As of December 31, 1997
year with particular emphasis in broadcasting. We also favored specialty
retailing and entertainment, both of which contributed positively to Fund
performance. As commodity prices came under pressure in the fourth quarter
because of the currency crisis in Southeast Asia, bonds in the energy sector
were pared back. To reduce exposure to economically sensitive issues on the
chance that economic growth will moderate, we also reduced bonds issued by
companies in cyclical industries like paper and chemical.
For the coming year, favorable conditions such as continuing economic growth,
low inflation, and positive cash flows into high yield mutual funds should
continue to make this market attractive for the near term.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
PORTFOLIO QUALITY
<S> <C>
Ba 41.0%
B 59.0%
as of December 31, 1997
as rated by Moody's Investor Services,
Inc.
</TABLE>
GROWTH OF $10,000 SINCE INCEPTION
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
COLUMBIA HIGH YIELD FUND SALOMON BB
<S> <C> <C>
10/1/93 $10,000 $10,000
12/31/93 $10,112 $10,185
12/31/94 $10,019 $10,048
12/31/95 $11,935 $12,321
12/31/96 $13,060 $13,429
12/31/97 $14,717 $15,142
Average Annual Total Returns as of December 31, 1997
CHYF Salomon BB
1 Year 12.70% 12.76%
3 Years 13.68% 14.65%
Since Inception 9.40% 10.13%
Past Performance is not predictive of future
performance.
<CAPTION>
LIPPER HIGH YIELD BOND FUND INDEX
<S> <C>
10/1/93 $10,000
12/31/93 $10,498
12/31/94 $10,113
12/31/95 $11,870
12/31/96 $13,373
12/31/97 $15,100
Average Annual Total Returns as of December 31, 1997
Lipper HYBF
1 Year 12.91%
3 Years 14.30%
Since Inception 10.06%
Past Performance is not predictive of future
performance.
</TABLE>
14
<PAGE>
FINANCIAL HIGHLIGHTS
-----------------------------------------------------------------
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD
- ---- ----
-- COLUMBIA COMMON STOCK FUND, INC. --
--------------------------------------
[LOGO]
<TABLE>
<CAPTION>
1997 1996 1995 1994 1993
----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $19.26 $18.59 $15.16 $15.29 $14.04
- ---------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income................. .29 .25 .26 .27 .22
Net realized and unrealized gains on
investments......................... 4.58 3.61 4.38 .04 2.08
- ---------------------------------------------------------------------------------------------------
Total from investment operations.... 4.87 3.86 4.64 .31 2.30
- ---------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends (from net investment
income)............................. (.27) (.23) (.26) (.25) (.21)
Distributions (from capital gains).... (1.84) (2.96) (.95) (.19) (.84)
- ---------------------------------------------------------------------------------------------------
Total distributions................. (2.11) (3.19) (1.21) (.44) (1.05)
- ---------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $22.02 $19.26 $18.59 $15.16 $15.29
- ---------------------------------------------------------------------------------------------------
TOTAL RETURN............................ 25.37% 20.71% 30.84% 2.06% 16.44%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in
thousands)............................ $783,906 $536,760 $358,523 $124,263 $100,715
Ratio of expenses to average net
assets................................ 0.77% 0.76% 0.80% 0.84% 0.84%
Ratio of net investment income to
average net assets.................... 1.37% 1.32% 1.68% 1.82% 1.48%
Portfolio turnover rate................. 90.23% 111.39% 75.36% 64.21% 90.90%
Average commission rate paid on
portfolio transactions (1)............ $0.0601 $0.0601
</TABLE>
(1) The average commission rate paid by the fund is computed by dividing the
dollar amount of commissions paid during the period by the total number of
shares purchased and sold during the period for which commissions were
charged.
- --------------------------------------------------------------------------------
15
<PAGE>
FINANCIAL HIGHLIGHTS
-----------------------------------------------------------------
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD
- ---- ----
-- COLUMBIA GROWTH FUND, INC. --
--------------------------------
[LOGO]
<TABLE>
<CAPTION>
1997 1996 1995 1994 1993
----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C>
- -------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $30.74 $29.84 $24.84 $26.38 $26.18
- -------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income................. .19 .19 .31 .29 .16
Net realized and unrealized gains
(losses) on investments............. 7.90 6.04 7.86 (.46) 3.24
- -------------------------------------------------------------------------------------------------------
Total from investment operations.... 8.09 6.23 8.17 (.17) 3.40
- -------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends (from net investment
income)............................. (.17) (.17) (.29) (.26) (.18)
Distributions (from capital gains).... (4.32) (5.14) (2.87) (1.11) (2.98)
Distributions (in excess of capital
gains).............................. (.02) (.01) (.04)
- -------------------------------------------------------------------------------------------------------
Total distributions................. (4.49) (5.33) (3.17) (1.37) (3.20)
- -------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $34.34 $30.74 $29.84 $24.84 $26.38
- -------------------------------------------------------------------------------------------------------
TOTAL RETURN............................ 26.32% 20.80% 32.98% -0.63% 13.01%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in
thousands)............................ $1,324,918 $1,064,100 $848,731 $591,694 $605,401
Ratio of expenses to average net
assets................................ 0.71% 0.71% 0.75% 0.81% 0.82%
Ratio of net investment income to
average net assets.................... 0.55% 0.63% 1.14% 1.12% 0.66%
Portfolio turnover rate................. 95.67% 75.49% 94.73% 79.28% 105.64%
Average commission rate paid on
portfolio transactions (1)............ $0.0594 $0.0590
</TABLE>
(1) The average commission rate paid by the fund is computed by dividing the
dollar amount of commissions paid during the period by the total number of
shares purchased and sold during the period for which commissions were
charged.
- --------------------------------------------------------------------------------
16
<PAGE>
FINANCIAL HIGHLIGHTS
-----------------------------------------------------------------
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD
- ---- ----
-- COLUMBIA INTERNATIONAL STOCK FUND, INC. --
---------------------------------------------
[LOGO]
<TABLE>
<CAPTION>
1997 1996 1995 1994 1993
----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF
PERIOD $13.86 $13.07 $12.43 $12.96 $9.95
- ----------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss)..... .03 .03 .02 (.02) (.02)
Net realized and unrealized gains
(losses) on investments and
foreign currency
transactions................... 1.56 2.13 .62 (.30) 3.34
- ----------------------------------------------------------------------------------------------
Total from investment
operations................... 1.59 2.16 .64 (.32) 3.32
- ----------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends (from net investment
income)........................ (.03)
Dividends (in excess of net
investment income)............. (.20)
Distributions (from capital
gains)......................... (1.75) (1.14) (.21) (.31)
- ----------------------------------------------------------------------------------------------
Total distributions............ (1.75) (1.37) -- (.21) (.31)
- ----------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $13.70 $13.86 $13.07 $12.43 $12.96
- ----------------------------------------------------------------------------------------------
TOTAL RETURN....................... 11.47% 16.59% 5.15% -2.47% 33.37%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in
thousands)....................... $146,281 $125,510 $100,873 $118,484 $73,047
Ratio of expenses to average net
assets........................... 1.62% 1.54% 1.54% 1.52% 1.71%
Ratio of net investment income
(loss) to average net assets..... 0.19% 0.22% 0.15% (0.21)% (0.62)%
Portfolio turnover rate............ 121.53% 129.40% 156.09% 138.79% 144.78%
Average commission rate paid on
portfolio transactions (1)....... $0.0039 $0.0011
</TABLE>
(1) The average commission rate paid by the fund is computed by dividing the
dollar amount of commissions paid during the period by the total number of
shares purchased and sold during the period for which commissions were
charged.
- --------------------------------------------------------------------------------
17
<PAGE>
FINANCIAL HIGHLIGHTS
-----------------------------------------------------------------
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD
- ---- ----
-- COLUMBIA SPECIAL FUND, INC. --
---------------------------------
[LOGO]
<TABLE>
<CAPTION>
1997 1996 1995 1994 1993
----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $19.85 $21.44 $18.69 $19.51 $18.79
- ---------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss).......... .01 (.06) .03 .08 .01
Net realized and unrealized gains on
investments......................... 2.50 2.85 5.45 .36 4.04
- ---------------------------------------------------------------------------------------------------------
Total from investment operations.... 2.51 2.79 5.48 .44 4.05
- ---------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends (from net investment
income)............................. (.02) (.07)
Dividends (in excess of net investment
income)............................. (.01)
Distributions (from capital gains).... (2.10) (4.38) (2.68) (1.16) (3.32)
Distributions (in excess of captial
gains).............................. (.03) (.03)
- ---------------------------------------------------------------------------------------------------------
Total distributions................. (2.10) (4.38) (2.73) (1.26) (3.33)
- ---------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $20.26 $19.85 $21.44 $18.69 $19.51
- ---------------------------------------------------------------------------------------------------------
TOTAL RETURN............................ 12.64% 13.07% 29.53% 2.29% 21.68%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in
thousands)............................ $1,249,718 $1,585,284 $1,384,415 $889,526 $772,741
Ratio of expenses to average net
assets................................ 0.98% 0.94% 0.98% 1.05% 1.12%
Ratio of net investment income (loss) to
average net assets.................... 0.04% (0.29)% 0.16% 0.40% 0.01%
Portfolio turnover rate................. 166.46% 150.07% 182.99% 178.91% 154.68%
Average commission rate paid on
portfolio transactions (1)............ $0.0585 $0.0553
</TABLE>
(1) The average commission rate paid by the fund is computed by dividing the
dollar amount of commissions paid during the period by the total number of
shares purchased and sold during the period for which commissions were
charged.
- --------------------------------------------------------------------------------
18
<PAGE>
FINANCIAL HIGHLIGHTS
-----------------------------------------------------------------
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD
- ---- ----
-- COLUMBIA SMALL CAP FUND, INC. --
-----------------------------------
[LOGO]
<TABLE>
<CAPTION>
1997 1996(1)
----- -------
<S> <C> <C>
- -------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $12.99 $12.00
- -------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment loss............................. (.08)
Net realized and unrealized gains on
investments................................... 4.51 .99
- -------------------------------------------------------------------------
Total from investment operations.............. 4.43 .99
- -------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Distributions (from capital gains).............. (.77)
- -------------------------------------------------------------------------
Total distributions........................... (.77) --
- -------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $16.65 $12.99
- -------------------------------------------------------------------------
TOTAL RETURN...................................... 34.10% 7.62%(2)
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in thousands).......... $96,431 $21,061
Ratio of expenses to average net assets........... 1.46% 1.61%
Ratio of net investment income (loss) to average
net assets...................................... (0.81)% 0.00%
Portfolio turnover rate........................... 171.75% 32.57%
Average commission rate paid on portfolio
transactions (3)................................ $0.0564 $0.0546
</TABLE>
(1) From inception of operations on September 11, 1996. Ratios and portfolio
turnover rate are annualized.
(2) Not annualized.
(3) The average commission rate paid by the fund is computed by dividing the
dollar amount of commissions paid during the period by the total number of
shares purchased and sold during the period for which commissions were
charged.
- --------------------------------------------------------------------------------
19
<PAGE>
FINANCIAL HIGHLIGHTS
-----------------------------------------------------------------
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD
- ---- ----
-- COLUMBIA REAL ESTATE EQUITY FUND, INC. --
--------------------------------------------
[LOGO]
<TABLE>
<CAPTION>
1997 1996 1995 1994(1)
----- ----- ----- -------
<S> <C> <C> <C> <C>
- -------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $16.16 $12.71 $11.72 $12.00
- -------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income................. .79 .77 .78 .49
Net realized and unrealized gains
(losses) on investments............. 3.15 3.94 1.12 (.27)
- -------------------------------------------------------------------------------------
Total from investment operations.... 3.94 4.71 1.90 .22
- -------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends (from net investment
income)............................. (.62) (.52) (.49) (.31)
Dividends (in excess of net investment
income)............................. (.01)
Distributions (from capital gains).... (.48) (.41)
Distributions (in excess of capital
gains).............................. (.03) (.12) (.14)
Tax return of capital................. (.17) (.21) (.28) (.18)
- -------------------------------------------------------------------------------------
Total distributions................. (1.30) (1.26) (.91) (.50)
- -------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $18.80 $16.16 $12.71 $11.72
- -------------------------------------------------------------------------------------
TOTAL RETURN............................ 24.74% 38.30% 16.86% 1.76%(2)
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in
thousands)............................ $151,554 $68,073 $21,587 $17,402
Ratio of expenses to average net
assets................................ 1.02% 1.06% 1.18% 1.14%
Ratio of net investment income to
average net assets.................... 4.87% 6.23% 6.71% 6.28%
Portfolio turnover rate................. 33.55% 45.82% 53.91% 7.61%
Average commission rate paid on
portfolio transactions (3)............ $0.0588 $0.0594
</TABLE>
(1) From inception of operations on March 16, 1994. Ratios and portfolio
turnover rate are annualized.
(2) Not annualized.
(3) The average commission rate paid by the fund is computed by dividing the
dollar amount of commissions paid during the period by the total number of
shares purchased and sold during the period for which commissions were
charged.
- --------------------------------------------------------------------------------
20
<PAGE>
FINANCIAL HIGHLIGHTS
-----------------------------------------------------------------
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD
- ---- ----
-- COLUMBIA BALANCED FUND, INC. --
----------------------------------
[LOGO]
<TABLE>
<CAPTION>
1997 1996 1995 1994 1993
----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $20.32 $20.08 $17.28 $17.91 $16.80
- ---------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income................. .84 .76 .73 .65 .56
Net realized and unrealized gains
(losses) on investments............. 2.92 1.58 3.54 (.64) 1.71
- ---------------------------------------------------------------------------------------------------
Total from investment operations.... 3.76 2.34 4.27 .01 2.27
- ---------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends (from net investment
income)............................. (.83) (.76) (.73) (.64) (.56)
Dividends (in excess of net investment
income)............................. (.01)
Distributions (from capital gains).... (1.83) (1.34) (.74) (.59)
- ---------------------------------------------------------------------------------------------------
Total distributions................. (2.66) (2.10) (1.47) (.64) (1.16)
- ---------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $21.42 $20.32 $20.08 $17.28 $17.91
- ---------------------------------------------------------------------------------------------------
TOTAL RETURN............................ 18.74% 11.78% 25.08% 0.10% 13.62%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in
thousands)............................ $792,378 $672,593 $486,767 $249,670 $186,589
Ratio of expenses to average net
assets................................ 0.68% 0.66% 0.69% 0.72% 0.73%
Ratio of net investment income to
average net assets.................... 3.83% 3.82% 4.05% 3.82% 3.32%
Portfolio turnover rate................. 148.91% 133.21% 108.04% 98.48% 107.60%
Average commission rate paid on
portfolio transactions (1)............ $0.0610 $0.0596
</TABLE>
(1) The average commission rate paid by the fund is computed by dividing the
dollar amount of commissions paid during the period by the total number of
shares purchased and sold during the period for which commissions were
charged.
- --------------------------------------------------------------------------------
21
<PAGE>
FINANCIAL HIGHLIGHTS
-----------------------------------------------------------------
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD
- ---- ----
-- COLUMBIA DAILY INCOME COMPANY --
-----------------------------------
[LOGO]
<TABLE>
<CAPTION>
1997 1996 1995 1994 1993
----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $1.00 $1.00 $1.00 $1.00 $1.00
- -----------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income................. .050 .048 .053 .036 .025
- -----------------------------------------------------------------------------------------------------
Total from investment operations.... .050 .048 .053 .036 .025
- -----------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends (from net investment
income)............................. (.050) (.048) (.053) (.036) (.025)
- -----------------------------------------------------------------------------------------------------
Total distributions................. (.050) (.048) (.053) (.036) (.025)
- -----------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $1.00 $1.00 $1.00 $1.00 $1.00
- -----------------------------------------------------------------------------------------------------
TOTAL RETURN............................ 5.11% 4.96% 5.49% 3.68% 2.51%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in
thousands)............................ $1,169,096 $889,800 $800,656 $730,067 $544,500
Ratio of expenses to average net
assets................................ 0.63% 0.62% 0.64% 0.70% 0.75%
Ratio of net investment income to
average net assets.................... 4.99% 4.84% 5.34% 3.68% 2.49%
</TABLE>
- --------------------------------------------------------------------------------
22
<PAGE>
FINANCIAL HIGHLIGHTS
-----------------------------------------------------------------
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD
- ---- ----
-- COLUMBIA U.S. GOVERNMENT SECURITIES FUND, INC. --
----------------------------------------------------
[LOGO]
<TABLE>
<CAPTION>
1997 1996 1995 1994 1993
----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $8.24 $8.34 $7.99 $8.36 $8.35
- ---------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income................. .41 .41 .45 .37 .32
Net realized and unrealized gains
(losses) on investments............. .05 (.10) .35 (.37) .17
- ---------------------------------------------------------------------------------------------------
Total from investment operations.... .46 .31 .80 -- .49
- ---------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends (from net investment
income)............................. (.41) (.41) (.45) (.37) (.32)
Distributions (from capital gains).... (.16)
- ---------------------------------------------------------------------------------------------------
Total distributions................. (.41) (.41) (.45) (.37) (.48)
- ---------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $8.29 $8.24 $8.34 $7.99 $8.36
- ---------------------------------------------------------------------------------------------------
TOTAL RETURN............................ 5.76% 3.85% 10.21% -0.03% 5.91%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in
thousands)............................ $37,837 $40,776 $41,842 $33,512 $35,877
Ratio of expenses to average net
assets................................ 0.87% 0.80% 0.79% 0.81% 0.75%
Ratio of net investment income to
average net assets.................... 4.99% 4.99% 5.45% 4.51% 3.74%
Portfolio turnover rate................. 184.43% 179.38% 253.17% 253.80% 254.59%
</TABLE>
- --------------------------------------------------------------------------------
23
<PAGE>
FINANCIAL HIGHLIGHTS
-----------------------------------------------------------------
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD
- ---- ----
-- COLUMBIA FIXED INCOME SECURITIES FUND, INC. --
-------------------------------------------------
[LOGO]
<TABLE>
<CAPTION>
1997 1996 1995 1994 1993
----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $13.08 $13.51 $12.16 $13.44 $13.28
- ---------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income................. .85 .85 .88 .83 .85
Net realized and unrealized gains
(losses) on investments............. .36 (.43) 1.35 (1.28) .52
- ---------------------------------------------------------------------------------------------------
Total from investment operations.... 1.21 .42 2.23 (.45) 1.37
- ---------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends (from net investment
income)............................. (.85) (.85) (.88) (.83) (.85)
Distributions (from capital gains).... (.03) (.36)
- ---------------------------------------------------------------------------------------------------
Total distributions................. (.88) (.85) (.88) (.83) (1.21)
- ---------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $13.41 $13.08 $13.51 $12.16 $13.44
- ---------------------------------------------------------------------------------------------------
TOTAL RETURN............................ 9.56% 3.37% 18.91% -3.36% 10.47%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in
thousands)............................ $381,333 $356,421 $316,259 $252,090 $300,532
Ratio of expenses to average net
assets................................ 0.66% 0.64% 0.65% 0.66% 0.66%
Ratio of net investment income to
average net assets.................... 6.43% 6.53% 6.80% 6.53% 6.14%
Portfolio turnover rate................. 196.28% 178.25% 137.41% 139.81% 118.80%
</TABLE>
- --------------------------------------------------------------------------------
24
<PAGE>
FINANCIAL HIGHLIGHTS
-----------------------------------------------------------------
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD
- ---- ----
-- COLUMBIA MUNICIPAL BOND FUND, INC. --
----------------------------------------
[LOGO]
<TABLE>
<CAPTION>
1997 1996 1995 1994 1993
----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $12.15 $12.37 $11.48 $12.71 $12.17
- ---------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income................. .60 .61 .63 .64 .66
Net realized and unrealized gains
(losses) on investments............. .39 (.16) .96 (1.23) .62
- ---------------------------------------------------------------------------------------------------
Total from investment operations.... .99 .45 1.59 (.59) 1.28
- ---------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends (from net investment income)
(1)................................. (.60) (.61) (.63) (.64) (.66)
Distributions (from capital gains).... (.07) (.06) (.07) (.08)
- ---------------------------------------------------------------------------------------------------
Total distributions................. (.67) (.67) (.70) (.64) (.74)
- ---------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $12.47 $12.15 $12.37 $11.48 $12.71
- ---------------------------------------------------------------------------------------------------
TOTAL RETURN............................ 8.36% 3.77% 14.15% -4.68% 10.73%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in
thousands)............................ $409,148 $375,667 $383,796 $339,817 $430,367
Ratio of expenses to average net
assets................................ 0.57% 0.56% 0.57% 0.57% 0.58%
Ratio of net investment income to
average net assets.................... 4.87% 5.00% 5.22% 5.36% 5.25%
Portfolio turnover rate................. 16.88% 19.03% 21.45% 19.40% 9.92%
</TABLE>
(1) 100% exempt from federal taxation.
- --------------------------------------------------------------------------------
25
<PAGE>
FINANCIAL HIGHLIGHTS
-----------------------------------------------------------------
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD
- ---- ----
-- COLUMBIA HIGH YIELD FUND, INC. --
------------------------------------
[LOGO]
<TABLE>
<CAPTION>
1997 1996 1995 1994 1993(1)
----- ----- ----- ----- -------
<S> <C> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $9.94 $9.88 $9.04 $9.94 $10.00
- -----------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income................. .81 .81 .82 .80 .18
Net realized and unrealized gains
(losses) on investments............. .40 .07 .84 (.90) (.06)
- -----------------------------------------------------------------------------------------------------------
Total from investment operations.... 1.21 .88 1.66 (.10) .12
- -----------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends (from net investment
income)............................. (.81) (.81) (.82) (.80) (.18)
Distributions (from capital gains).... (.30) (.01)
- -----------------------------------------------------------------------------------------------------------
Total distributions................. (1.11) (.82) (.82) (.80) (.18)
- -----------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $10.04 $9.94 $9.88 $9.04 $9.94
- -----------------------------------------------------------------------------------------------------------
TOTAL RETURN............................ 12.70% 9.43% 19.12% -0.92% 1.12%(2)
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in
thousands)............................ $39,278 $28,818 $23,471 $12,834 $5,940
Ratio of expenses to average net assets
(3)................................... 1.00% 0.93% 1.00% 1.00% 1.00%
Ratio of net investment income to
average net assets.................... 8.05% 8.29% 8.62% 8.69% 7.30%
Portfolio turnover rate................. 124.23% 62.27% 51.60% 36.67% 0.00%
</TABLE>
(1) From inception of operations on September 15, 1993. Ratios and portfolio
turnover rate are annualized.
(2) Not annualized.
(3) The ratio was 1.02% in 1997, 1.00% in 1996, 1.06% in 1995, 1.19% in 1994
and 2.03% in 1993, before voluntary reimbursement.
- --------------------------------------------------------------------------------
26
<PAGE>
SCHEDULE OF INVESTMENTS
-----------------------------------------------------------------
[LOGO]
- --------------------- ---------------------
-- COLUMBIA COMMON STOCK FUND, INC. --
--------------------------------------------
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL
December 31, 1997 AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
COMMON STOCKS (93.0%)
FINANCE (10.0%)
American Express Co. ................................................................. 100,900 $ 9,005,325
American General Corp. ............................................................... 209,600 11,331,500
BankAmerica Corp. .................................................................... 99,600 7,270,800
Berkley (W.R.) Corp. ................................................................. 150,000 6,581,250
*CIT Group, Inc. (Class A)............................................................ 200,000 6,450,000
First Union Corp. .................................................................... 261,300 13,391,625
NationsBank Corp. .................................................................... 126,000 7,662,375
PNC Bank Corp. ....................................................................... 140,900 8,040,106
U.S. Bancorp.......................................................................... 74,044 8,288,300
--------------
78,021,281
--------------
BUILDING & FORESTRY PRODUCTS (1.4%)
Willamette Industries, Inc. .......................................................... 334,400 10,763,500
--------------
BUSINESS & CONSUMER SERVICES (1.7%)
Service Corporation Int'l. ........................................................... 367,500 13,574,531
--------------
CHEMICAL (1.0%)
IMC Global, Inc. ..................................................................... 242,000 7,925,500
--------------
CONSUMER NON-DURABLE (11.5%)
*Costco Cos., Inc. ................................................................... 200,000 8,925,000
*Federated Department Stores, Inc. ................................................... 254,500 10,959,406
Home Depot, Inc. ..................................................................... 140,500 8,271,937
Liz Claiborne, Inc. .................................................................. 223,000 9,324,188
Mattel, Inc. ......................................................................... 259,250 9,657,063
*Meyer (Fred), Inc. .................................................................. 600,000 21,825,000
Nordstrom, Inc. ...................................................................... 225,000 13,584,375
Wal-Mart Stores, Inc. ................................................................ 192,500 7,591,719
--------------
90,138,688
--------------
CONSUMER STAPLES (16.8%)
American Stores Co. .................................................................. 860,000 17,683,750
Avon Products, Inc. .................................................................. 128,300 7,874,412
ConAgra, Inc. ........................................................................ 70,000 2,296,875
Gillette Co. ......................................................................... 145,000 14,563,438
Heinz (H.J.) Co. ..................................................................... 154,000 7,825,125
Kellogg Co. .......................................................................... 400,000 19,850,000
*Kroger Co. .......................................................................... 300,000 11,081,250
PepsiCo, Inc. ........................................................................ 200,000 7,287,500
Rite Aid Corp. ....................................................................... 147,200 8,638,800
*Safeway, Inc. ....................................................................... 156,000 9,867,000
Sunbeam Corp. ........................................................................ 379,400 15,982,225
Sysco Corp. .......................................................................... 200,000 9,112,500
--------------
132,062,875
--------------
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
<S> <C> <C>
ENERGY (6.8%)
Burlington Resources, Inc. ........................................................... 181,017 $ 8,111,824
Exxon Corp. .......................................................................... 160,800 9,838,950
Mobil Corp. .......................................................................... 141,600 10,221,750
Royal Dutch Petroleum Co. ............................................................ 249,600 13,525,200
Texaco, Inc. ......................................................................... 212,000 11,527,500
--------------
53,225,224
--------------
ENERGY SERVICES (1.1%)
Schlumberger Ltd. .................................................................... 105,000 8,452,500
--------------
ENTERTAINMENT & MEDIA (1.2%)
*Viacom, Inc. (Class B)............................................................... 235,500 9,758,531
--------------
HEALTH (12.6%)
American Home Products Corp. ......................................................... 134,000 10,251,000
Bristol-Myers Squibb Co. ............................................................. 175,000 16,559,375
Lilly (Eli) & Co. .................................................................... 242,000 16,849,250
Merck & Co., Inc. .................................................................... 155,000 16,468,750
Pfizer, Inc. ......................................................................... 169,000 12,601,062
Schering-Plough Corp. ................................................................ 154,000 9,567,250
*Tenet Healthcare Corp. .............................................................. 249,300 8,258,063
Warner-Lambert Co. ................................................................... 66,000 8,184,000
--------------
98,738,750
--------------
MACHINERY & CAPITAL SPENDING (5.4%)
Case Corp. ........................................................................... 133,000 8,038,187
Deere & Co. .......................................................................... 144,700 8,437,819
Emerson Electric Co. ................................................................. 213,000 12,021,188
Tyco International Ltd. .............................................................. 303,308 13,667,817
--------------
42,165,011
--------------
METAL MINING & STEEL (1.0%)
*Getchell Gold Corp. ................................................................. 310,000 7,440,000
--------------
REAL ESTATE SECURITIES (5.8%)
American Health Properties, Inc. ..................................................... 120,000 3,307,500
Equity Office Properties Trust........................................................ 174,521 5,508,319
Equity Residential Properties Trust................................................... 125,000 6,320,312
First Industrial Realty Trust, Inc. .................................................. 150,000 5,418,750
JP Realty, Inc. ...................................................................... 106,500 2,762,344
Liberty Property Trust................................................................ 120,000 3,427,500
Mack-Cali Realty Corp. ............................................................... 94,000 3,854,000
Manufactured Home Communities, Inc. .................................................. 49,000 1,323,000
Security Capital Pacific Trust........................................................ 165,500 4,013,375
Simon DeBartolo Group, Inc. .......................................................... 190,400 6,223,700
Spieker Properties, Inc. ............................................................. 79,000 3,387,125
--------------
45,545,925
--------------
</TABLE>
27
<PAGE>
SCHEDULE OF INVESTMENTS
-----------------------------------------------------------------
[LOGO]
- --------------------- ---------------------
-- COLUMBIA COMMON STOCK FUND, INC. --
--------------------------------------------
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
</TABLE>
COMMON STOCKS (CONTINUED)
<TABLE>
<S> <C> <C>
TECHNOLOGY (8.6%)
Autodesk, Inc. ....................................................................... 115,300 $ 4,266,100
Automatic Data Processing, Inc. ...................................................... 232,000 14,239,000
*Cadence Design Systems, Inc. ........................................................ 270,000 6,615,000
*Computer Sciences Corp. ............................................................. 190,200 15,881,700
*EMC Corp. ........................................................................... 260,200 7,139,238
Ericsson (L.M.) Telephone Co. (Class B) ADR........................................... 112,000 4,179,000
Hewlett-Packard Co. .................................................................. 122,400 7,650,000
Lucent Technologies, Inc. ............................................................ 94,800 7,572,150
--------------
67,542,188
--------------
UTILITIES/COMMUNICATIONS (2.7%)
AT&T Corp. ........................................................................... 124,000 7,595,000
Frontier Corp. ....................................................................... 244,300 5,878,469
SBC Communications, Inc. ............................................................. 102,400 7,500,800
--------------
20,974,269
--------------
UTILITIES/ELECTRIC/GAS (5.4%)
Cinergy Corp. ........................................................................ 237,000 9,080,063
Edison International.................................................................. 264,300 7,185,656
Idaho Power Co. ...................................................................... 236,600 8,902,075
Texas Utilities Co. .................................................................. 420,000 17,456,250
--------------
42,624,044
--------------
Total Common Stocks
(Cost $591,083,706) ................................................................. 728,952,817
--------------
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
<S> <C> <C>
REPURCHASE AGREEMENTS (12.1%)
Goldman Sachs Corp.
6.337% dated 12/31/1997,
due 01/02/1998 in the
amount of $39,316,709.
Collateralized by U.S. Treasury Notes
5.875% due 08/31/1999................................................................ $ 39,303,062 $ 39,303,062
J.P. Morgan Securities, Inc.
6.521% dated 12/31/1997,
due 01/02/1998 in the
amount of $38,613,793.
Collateralized by U.S. Treasury Notes
3.625% to 7.500%
due 08/31/2000 to 02/15/2005......................................................... 38,600,000 38,600,000
Merrill Lynch
6.388% dated 12/31/1997,
due 01/02/1998 in the
amount of $16,705,845.
Collateralized by U.S. Treasury Bonds
6.250% to 7.625% due
02/15/2023 to 08/15/2025............................................................. 16,700,000 16,700,000
--------------
Total Repurchase Agreements
(Cost $94,603,062) .................................................................. 94,603,062
--------------
TOTAL INVESTMENTS (105.1%)
(Cost $685,686,768)...................................................................... 823,555,879
RECEIVABLES LESS LIABILITIES (-5.1%)...................................................... (39,650,060)
--------------
NET ASSETS (100.0%)....................................................................... $ 783,905,819
--------------
--------------
</TABLE>
(1) See Note 1 of Notes to Financial Statements.
* Non-income producing.
The accompanying notes are an integral part
of the financial statements.
28
<PAGE>
SCHEDULE OF INVESTMENTS
-----------------------------------------------------------------
[LOGO]
- ------------------------- -------------------------
-- COLUMBIA GROWTH FUND, INC. --
-----------------------------------
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL
December 31, 1997 AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
COMMON STOCKS (98.3%)
FINANCE (18.8%)
Allstate Corp. ....................................................................... 271,600 $ 24,681,650
American General Corp. ............................................................... 488,600 26,414,937
American International Group, Inc. ................................................... 199,225 21,665,719
Banc One Corp. ....................................................................... 300,000 16,293,750
BankAmerica Corp. .................................................................... 200,000 14,600,000
BankBoston Corp. ..................................................................... 150,000 14,090,625
Barnett Banks, Inc. .................................................................. 239,000 17,178,125
*CIT Group, Inc. (Class A)............................................................ 600,000 19,350,000
Fannie Mae............................................................................ 456,800 26,066,150
First Union Corp. .................................................................... 198,000 10,147,500
Freddie Mac........................................................................... 500,700 20,998,106
Morgan Stanley, Dean Witter, Discover & Co. .......................................... 405,080 23,950,355
NationsBank Corp. .................................................................... 232,000 14,108,500
--------------
249,545,417
--------------
BUILDING & FORESTRY PRODUCTS (1.2%)
*Crown Vantage, Inc. ................................................................. 195,100 1,365,700
Mead Corp. ........................................................................... 500,000 14,000,000
--------------
15,365,700
--------------
BUSINESS & CONSUMER SERVICES (7.9%)
*Cendant Corp. ....................................................................... 1,231,550 42,334,531
*Corrections Corporation of America................................................... 400,000 14,825,000
*FIserv, Inc. ........................................................................ 300,500 14,762,063
McKesson Corp. ....................................................................... 148,900 16,109,119
Service Corporation Int'l. ........................................................... 448,300 16,559,081
--------------
104,589,794
--------------
CONSUMER DURABLE (0.1%)
*Sonic Automotive, Inc. .............................................................. 132,500 1,275,312
--------------
CONSUMER NON-DURABLE (16.7%)
*Consolidated Stores Corp. ........................................................... 491,200 21,582,100
*Federated Department Stores, Inc. ................................................... 402,800 17,345,575
Home Depot, Inc. ..................................................................... 135,100 7,954,012
Liz Claiborne, Inc. .................................................................. 290,000 12,125,625
Mattel, Inc. ......................................................................... 643,400 23,966,650
*Neiman-Marcus Group, Inc. ........................................................... 240,400 7,272,100
*Office Depot, Inc. .................................................................. 596,800 14,285,900
*Payless ShoeSource, Inc. ............................................................ 380,200 25,520,925
Royal Caribbean Cruises Ltd. ......................................................... 300,000 15,993,750
Tandy Corp. .......................................................................... 697,600 26,901,200
Unifi, Inc. .......................................................................... 200,000 8,137,500
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
<S> <C> <C>
Warnaco Group, Inc. (Class A)......................................................... 1,290,300 $ 40,483,163
--------------
221,568,500
--------------
CONSUMER STAPLES (14.8%)
Avon Products, Inc. .................................................................. 215,100 13,201,762
CVS Corp. ............................................................................ 190,000 12,171,875
Gillette Co. ......................................................................... 312,100 31,346,544
Kellogg Co. .......................................................................... 106,000 5,260,250
Libbey, Inc. ......................................................................... 390,500 14,790,188
Philip Morris Cos., Inc. ............................................................. 600,000 27,187,500
Rite Aid Corp. ....................................................................... 533,925 31,334,723
*Safeway, Inc. ....................................................................... 327,700 20,727,025
Sunbeam Corp. ........................................................................ 600,000 25,275,000
Sysco Corp. .......................................................................... 328,400 14,962,725
--------------
196,257,592
--------------
ENERGY (1.4%)
Anadarko Petroleum Corp. ............................................................. 177,000 10,741,688
Apache Corp. ......................................................................... 203,700 7,142,231
--------------
17,883,919
--------------
ENERGY SERVICES (0.9%)
Schlumberger Ltd. .................................................................... 150,000 12,075,000
--------------
HEALTH (13.0%)
American Home Products Corp. ......................................................... 180,000 13,770,000
*Apria Healthcare Group, Inc. ........................................................ 901,720 12,116,862
Bristol-Myers Squibb Co. ............................................................. 244,500 23,135,812
*Ethical Holdings Ltd. ADR............................................................ 283,000 884,375
Lilly (Eli) & Co. .................................................................... 322,100 22,426,213
Merck & Co., Inc. .................................................................... 246,200 26,158,750
Pfizer, Inc. ......................................................................... 327,300 24,404,306
Schering-Plough Corp. ................................................................ 217,600 13,518,400
*Tenet Healthcare Corp. .............................................................. 745,900 24,707,938
Warner-Lambert Co. ................................................................... 83,800 10,391,200
--------------
171,513,856
--------------
HOTELS & GAMING (1.4%)
*Host Marriott Corp. ................................................................. 390,000 7,653,750
*Station Casinos, Inc. ............................................................... 1,076,600 10,967,863
--------------
18,621,613
--------------
MACHINERY & CAPITAL SPENDING (5.2%)
Emerson Electric Co. ................................................................. 361,000 20,373,938
General Electric Co. ................................................................. 150,000 11,006,250
Tyco International Ltd. .............................................................. 830,354 37,417,827
--------------
68,798,015
--------------
</TABLE>
29
<PAGE>
SCHEDULE OF INVESTMENTS
-----------------------------------------------------------------
[LOGO]
- ------------------------- -------------------------
-- COLUMBIA GROWTH FUND, INC. --
-----------------------------------
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
</TABLE>
COMMON STOCKS (CONTINUED)
<TABLE>
<S> <C> <C>
REAL ESTATE SECURITIES (4.0%)
Duke Realty Investments, Inc. ........................................................ 168,200 $ 4,078,850
Equity Office Properties Trust........................................................ 111,800 3,528,688
Equity Residential Properties Trust................................................... 219,900 11,118,694
JP Realty, Inc. ...................................................................... 350,000 9,078,125
Public Storage, Inc. ................................................................. 50,000 1,468,750
Simon DeBartolo Group, Inc. .......................................................... 144,300 4,716,806
TriNet Corporate Realty Trust, Inc. .................................................. 146,000 5,648,375
Vornado Realty Trust.................................................................. 294,800 13,837,175
--------------
53,475,463
--------------
TECHNOLOGY (12.9%)
Autodesk, Inc. ....................................................................... 114,700 4,243,900
*Cadence Design Systems, Inc. ........................................................ 543,000 13,303,500
*Cisco Systems, Inc. ................................................................. 590,700 32,931,525
Computer Associates International, Inc. .............................................. 158,250 8,367,469
*Computer Sciences Corp. ............................................................. 289,500 24,173,250
*EMC Corp. ........................................................................... 379,600 10,415,275
Ericsson (L.M.) Telephone Co. (Class B) ADR........................................... 171,400 6,395,362
Hewlett-Packard Co. .................................................................. 202,900 12,681,250
Intel Corp. .......................................................................... 200,800 14,106,200
Lucent Technologies, Inc. ............................................................ 159,800 12,764,025
*Microsoft Corp. ..................................................................... 151,500 19,581,375
*Tellabs, Inc. ....................................................................... 225,000 11,896,875
--------------
170,860,006
--------------
Total Common Stocks
(Cost $998,562,165) ................................................................. 1,301,830,187
--------------
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
<S> <C> <C>
REPURCHASE AGREEMENT (2.1%)
Goldman Sachs Corp.
6.337% dated 12/31/1997,
due 01/02/1998 in the
amount of $27,758,843
Collateralized by U.S. Treasury Notes
5.875% due 08/31/1999
(Cost $27,749,208)................................................................... $ 27,749,208 $ 27,749,208
--------------
TOTAL INVESTMENTS (100.4%)
(Cost $1,026,311,373).................................................................... 1,329,579,395
RECEIVABLES LESS LIABILITIES (-0.4%)...................................................... (4,661,706)
--------------
NET ASSETS (100.0%)....................................................................... $1,324,917,689
--------------
--------------
</TABLE>
(1) See Note 1 of Notes to Financial Statements.
* Non-income producing.
The accompanying notes are an integral part
of the financial statements.
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<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL
December 31, 1997 AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
COMMON STOCKS (86.2%)
ARGENTINA (1.1%)
Banco de Galicia y Buenos Aires SA de CV, ADR (Banking)............................... 16,300 $ 419,725
*Disco SA, ADR (Retail)............................................................... 26,000 1,157,000
--------------
1,576,725
--------------
BELGIUM (0.6%)
*Lernout & Hauspie Speech Products NV (Business Services)............................. 20,000 930,000
--------------
BRAZIL (0.5%)
Cia Tecidos do Norte de Minas SA (Textiles)........................................... 1,973,067 707,192
--------------
CANADA (3.3%)
Bombardier, Inc. (Class B)
(Manufacturing - Diversified Inds.).................................................. 25,000 513,735
Canadian National Railway Co. (Transportation)........................................ 8,500 399,839
*Cognicase, Inc. (Business Services).................................................. 30,500 369,813
Magna International, Inc. (Class A)
(Motor Vehicles & Parts)............................................................. 12,000 751,520
*Newbridge Networks Corp. (Electronics)............................................... 15,000 524,743
Northern Telecom Ltd. (Electronics)................................................... 11,000 977,598
Royal Bank of Canada (Banking)........................................................ 17,000 898,302
Thomson Corp. (Media)................................................................. 16,000 438,946
--------------
4,874,496
--------------
CHILE (0.6%)
*Distribucion y Servicio D&S SA, ADR (Retail)......................................... 50,000 928,125
--------------
FINLAND (2.6%)
Finnlines Oyj (Transportation)........................................................ 34,000 1,354,880
Merita plc. (Class A) (Banking)....................................................... 280,000 1,532,274
Metsa Serla Oyj (Series B) (Paper & Forest Products).................................. 114,000 889,725
--------------
3,776,879
--------------
FRANCE (7.9%)
Alcatel Alsthom SA (Electronics)...................................................... 10,000 1,271,715
BIC SA (Consumer Products)............................................................ 10,000 730,280
Carrefour SA (Retail)................................................................. 1,200 626,382
Cie de Saint Gobain SA (Building Materials)........................................... 6,084 864,736
Cie Francaise d'Etudes et de Construction Technip (Construction)...................... 3,700 390,574
Cipe France SA (Business Services).................................................... 5,400 182,588
Elf-Aquitaine SA (Oil Exploration & Production)....................................... 11,000 1,280,027
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
<S> <C> <C>
*France Telecom SA, ADR (Utilities - Communication)................................... 39,000 $ 1,404,000
Lafarge SA (Building Materials)....................................................... 7,200 472,659
L'Oreal SA (Consumer Products)........................................................ 2,500 978,722
*Renault SA (Motor Vehicles & Parts).................................................. 60,000 1,688,638
Schneider SA (Electrical Equipment)................................................... 13,000 706,242
Sodexho Alliance SA (Food & Beverages)................................................ 1,000 535,783
Synthelabo SA (Pharmaceuticals)....................................................... 3,600 450,037
--------------
11,582,383
--------------
GERMANY (4.9%)
Allianz AG (Insurance)................................................................ 3,000 777,401
Deutsche Bank AG (Banking)............................................................ 12,500 882,778
Gehe AG (Wholesale Distributor)....................................................... 20,000 1,000,945
Heidelberger Zement AG (Building Materials)........................................... 3,850 274,037
Mannesmann AG (Machinery & Capital Spending).......................................... 3,400 1,718,623
Siemens AG (Electrical Equipment)..................................................... 7,500 444,169
Thyssen AG (Steel).................................................................... 6,000 1,284,547
Volkswagen AG (Motor Vehicles & Parts)................................................ 1,500 844,131
--------------
7,226,631
--------------
HUNGARY (0.4%)
*Gedeon Richter Ltd., GDS (Pharmaceuticals)........................................... 5,400 627,750
--------------
INDIA (3.1%)
Bajaj Auto Ltd., GDR (Motor Vehicles & Parts)......................................... 30,000 607,500
Bank of Baroda Ltd. (Banking)......................................................... 271,000 783,197
Indian Hotels Co., Ltd., The, GDR (Entertainment & Leisure)........................... 37,000 696,063
Industrial Credit & Investment Corp. of India Ltd., The, GDR (Financial Services)..... 30,000 387,750
Infosys Technologies Ltd. (Business Services)......................................... 16,000 506,803
Mahindra & Mahindra Ltd. (Motor Vehicles & Parts)..................................... 70,000 581,841
Tata Engineering & Locomotive Co., Ltd., GDS (Motor Vehicles & Parts)................. 50,000 416,750
Videsh Sanchar Nigam Ltd., GDR (Utilities - Communication)............................ 40,000 557,000
--------------
4,536,904
--------------
INDONESIA (0.5%)
*Gulf Indonesia Resources Ltd. (Oil Exploration & Production)......................... 36,000 792,000
--------------
ITALY (2.1%)
Credito Italiano S.p.A (Banking)...................................................... 338,500 1,047,606
ENI S.p.A (Oil Exploration & Production).............................................. 132,000 754,179
</TABLE>
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<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
</TABLE>
COMMON STOCKS (CONTINUED)
<TABLE>
<S> <C> <C>
Fiat S.p.A (Motor Vehicles & Parts)................................................... 266,000 $ 771,928
Gewiss S.p.A (Electrical Equipment)................................................... 24,800 469,883
--------------
3,043,596
--------------
JAPAN (22.2%)
Banyu Pharmaceutical Co., Ltd. (Pharmaceuticals)...................................... 22,000 243,599
Bellsystem 24, Inc. (Business Services)............................................... 6,000 788,927
BRIDGESTONE CORP. (Motor Vehicles & Parts)............................................ 32,000 696,348
DENSO CORP. (Motor Vehicles & Parts).................................................. 23,000 415,609
East Japan Railway Co. (Transportation)............................................... 148 670,296
Fuji Heavy Inds., Ltd. (Machinery & Capital Spending)................................. 91,000 246,305
Fuji Photo Film Co., Ltd. (Entertainment & Leisure)................................... 50,000 1,922,338
FUJITSU LTD. (Electronics)............................................................ 47,000 505,959
Hitachi Maxell Ltd. (Electronics)..................................................... 36,000 636,678
Ishikawajima-Harima Heavy Industries Co., Ltd. (Machinery & Capital Spending)......... 310,000 464,821
ITO-YOKADO CO., LTD. (Retail)......................................................... 31,000 1,585,160
KEYENCE CORP. (Electronics)........................................................... 6,600 979,469
KOMATSU LTD. (Machinery & Capital Spending)........................................... 143,000 720,223
MABUCHI MOTOR CO., LTD. (Electrical Equipment)........................................ 16,000 815,686
Mitsubishi Estate Co., Ltd. (Real Estate)............................................. 70,000 764,321
Mitsubishi Trust & Banking Corp., The (Banking)....................................... 55,000 554,018
MITSUI & CO., LTD. (Wholesale Distributor)............................................ 90,000 534,256
Mitsui Fudosan Co., Ltd. (Real Estate)................................................ 72,000 697,578
MYCAL CORP. (Retail).................................................................. 95,000 796,232
Nintendo Co., Ltd. (Entertainment & Leisure).......................................... 18,000 1,785,467
NIPPON STEEL CORP. (Metals, Mining & Steel)........................................... 300,000 445,213
NIPPON TELEGRAPH & TELEPHONE CORP. (Utilities - Communication)........................ 1,000 861,207
Nomura Securities Co., Ltd., The (Financial Services)................................. 76,000 1,016,840
NTT Data Communications Systems Corp. (Business Services)............................. 35 1,891,965
ROHM CO., LTD. (Electronics).......................................................... 17,000 1,738,562
SANKYO CO., LTD. (Pharmaceuticals).................................................... 36,000 816,609
Sekisui House, Ltd. (Construction).................................................... 112,000 722,553
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
<S> <C> <C>
Shiseido Co., Ltd. (Consumer Products)................................................ 110,000 $ 1,505,575
SONY CORP. (Electronics).............................................................. 28,000 2,497,501
Sumitomo Bank Ltd., The (Banking)..................................................... 58,000 664,514
Takeda Chemical Inds., Ltd. (Pharmaceuticals)......................................... 41,000 1,172,780
Tokio Marine & Fire Insurance Co., Ltd., The (Insurance).............................. 130,000 1,479,431
TOYOTA MOTOR CORP. (Motor Vehicles
& Parts)............................................................................. 50,000 1,437,909
TRANS COSMOS, INC. (Business Services)................................................ 18,000 316,955
--------------
32,390,904
--------------
MEXICO (3.8%)
Fomento Economico Mexicano SA de CV (Series B) (Food & Beverages)..................... 100,000 800,546
*Industrias CH SA (Series B) (Steel).................................................. 280,000 1,682,016
Panamerican Beverages, Inc. (Class A) (Food & Beverages).............................. 26,000 848,250
*Tubos de Acero de Mexico SA, ADR (Steel)............................................. 102,000 2,205,750
--------------
5,536,562
--------------
NETHERLANDS (4.2%)
ABN Amro Holding NV (Banking)......................................................... 32,524 633,480
Aegon NV (Insurance).................................................................. 25,992 2,313,391
Akzo Nobel NV (Chemicals)............................................................. 4,800 827,456
Koninklijke Pakhoed NV (Certificates)
(Oil Equipment & Services)........................................................... 16,484 475,500
Philips Electronics NV (Electronics).................................................. 20,000 1,199,211
Vendex International NV (Certificates) (Retail)....................................... 13,178 727,129
--------------
6,176,167
--------------
NORWAY (1.5%)
*Fred Olsen Energy ASA (Oil Exploration & Production)................................. 20,000 415,902
Smedvig ASA (Class A) (Oil Equipment & Services)...................................... 32,000 674,142
Tomra Systems ASA (Machinery & Capital Spending)...................................... 49,000 1,098,879
--------------
2,188,923
--------------
SPAIN (3.6%)
Banco Bilbao Vizcaya SA (Banking)..................................................... 48,000 1,552,960
Dragados & Construcciones SA (Construction)........................................... 39,000 830,522
Inmobiliaria Metropolitana Vasco Central SA (Real Estate)............................. 17,500 788,982
*Tele Pizza SA (Restaurants).......................................................... 6,500 524,675
</TABLE>
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<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
</TABLE>
COMMON STOCKS (CONTINUED)
<TABLE>
<S> <C> <C>
Telefonica de Espana SA, ADR (Utilities - Communication).............................. 10,000 $ 910,625
Vallehermoso SA (Real Estate)......................................................... 20,000 612,941
--------------
5,220,705
--------------
SWEDEN (3.9%)
*Argonaut AB (Class B) (Transportation)............................................... 515,000 882,894
Assa Abloy AB (Class B) (Manufacturing - Diversified Inds.)........................... 33,000 873,566
ICB Shipping AB (Class B) (Transportation)............................................ 140,000 1,764,780
*Munters AB (Manufacturer - Consumer Products)........................................ 110,000 949,830
SSAB Svenskt Stal AB (Class B) (Metals, Mining & Steel)............................... 25,000 412,833
Telefonaktiebolaget LM Ericsson, ADR (Electronics).................................... 20,000 746,250
--------------
5,630,153
--------------
SWITZERLAND (3.0%)
Credit Suisse Group (Registered) (Financial Services)................................. 6,500 1,006,509
Novartis AG (Bearer) (Pharmaceuticals)................................................ 2,100 3,417,266
--------------
4,423,775
--------------
UNITED KINGDOM (16.4%)
Associated British Foods plc (Food & Beverages)....................................... 62,000 540,646
Bank of Scotland (Banking)............................................................ 86,000 792,376
Barclays plc (Banking)................................................................ 50,639 1,348,058
British Aerospace plc (Aircraft & Aerospace).......................................... 38,000 1,084,746
British Petroleum Co. plc (Oil Exploration & Production).............................. 56,561 744,478
British Sky Broadcasting Group plc (Media)............................................ 105,000 787,770
British Telecommunications plc (Utilities - Communication)............................ 110,000 866,004
Compass Group plc (Restaurants)....................................................... 160,000 1,971,728
Electrocomponents plc (Electronics)................................................... 86,469 643,049
Glaxo Wellcome plc (Pharmaceuticals).................................................. 86,000 2,037,540
Granada Group plc (Entertainment & Leisure)........................................... 60,975 932,996
Hays plc (Business Services).......................................................... 120,000 1,603,180
National Westminster Bank plc (Banking)............................................... 93,000 1,548,491
Next plc (Retail)..................................................................... 80,000 910,838
Railtrack Group plc (Transportation).................................................. 100,000 1,591,005
Reuters Holdings plc (Media).......................................................... 69,000 754,946
Siebe plc (Machinery & Capital Spending).............................................. 72,295 1,421,416
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
<S> <C> <C>
*Smallworldwide plc, ADR (Business Services).......................................... 19,000 $ 415,625
SmithKline Beecham plc (Pharmaceuticals).............................................. 200,682 2,057,034
Smiths Industries plc (Manufacturing - Diversified Inds.)............................. 28,000 390,660
Wetherspoon, J.D. plc (Restaurants)................................................... 140,000 771,646
WPP Group plc (Media)................................................................. 160,000 709,453
--------------
23,923,685
--------------
Total Common Stocks
(Cost $111,122,019).................................................................. 126,093,555
--------------
PREFERRED STOCKS (2.2%)
BRAZIL (1.4%)
Bardella Industrias Mecanicas SA (Manufacturing - Diversified Inds.).................. 4,000 430,108
Cia Cervejaria Brahma SA (Food & Beverages)........................................... 1,195,000 803,091
Cia Paranaense de Energi SA (Class B) (Utilities - Electric).......................... 48,000,000 653,763
DIXIE TOGA SA (Containers)............................................................ 437,500 223,454
*Empresa Nacional de Comercio Redito e Participacoes SA (Textiles).................... 1,195,000 857
--------------
2,111,273
GERMANY (0.8%)
Porsche AG (Motor Vehicles & Parts)................................................... 700 1,167,770
--------------
Total Preferred Stocks
(Cost $2,718,459) ................................................................... 3,279,043
--------------
WARRANTS (0.1%)
FRANCE (0.1%)
*Cie Generale des Eaux (05/02/2001) (Utilities)....................................... 220,000 149,580
JAPAN (0.0%)
*Mr. Max Corp. (02/17/1998) (Retail).................................................. 5,000 0
--------------
Total Warrants
(Cost $692,496) ..................................................................... 149,580
--------------
CONVERTIBLE NOTE (0.5%)
GERMANY (0.5%)
Daimler-Benz AG, GDR (Motor Vehicles & Parts) 5.750% 06/14/2002
(Cost $819,929)...................................................................... 9,838 737,850
--------------
Total investments, excluding temporary cash investments
(Cost $115,352,903) ................................................................. 130,260,028
--------------
</TABLE>
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<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
<S> <C> <C>
REPURCHASE AGREEMENTS (11.7%)
Goldman Sachs Corp.
6.337% dated 12/31/1997,
due 01/02/1998 in the
amount of $7,418,693.
Collateralized by U.S. Treasury Notes
5.875% due 08/31/1999................................................................ $ 7,416,118 $ 7,416,118
J.P. Morgan Securities, Inc.
6.521% dated 12/31/1997,
due 01/02/1998 in the
amount of $7,352,626.
Collateralized by U.S. Treasury Notes
3.625% to 7.500%
due 08/31/2000 to 02/15/2005......................................................... 7,350,000 7,350,000
Merrill Lynch
6.388% dated 12/31/1997,
due 01/02/1998 in the
amount of $2,300,805.
Collateralized by U.S. Treasury Bonds
6.250% to 7.625%
due 02/15/2023 to 08/15/2025......................................................... 2,300,000 2,300,000
--------------
Total Repurchase Agreements
(Cost $17,066,118) .................................................................. 17,066,118
--------------
TOTAL INVESTMENTS (100.7%)
(Cost $132,419,021)...................................................................... 147,326,146
CASH AND RECEIVABLES LESS LIABILITIES (-0.7%)............................................. (1,045,611)
--------------
NET ASSETS (100%)......................................................................... $ 146,280,535
--------------
--------------
</TABLE>
(1) See Note 1 of Notes to Financial Statements.
* Non-income producing.
The accompanying notes are an integral part
of the financial statements.
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<CAPTION>
SHARES OR
PRINCIPAL
December 31, 1997 AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
COMMON STOCKS (97.5%)
BUILDING & FORESTRY PRODUCTS (2.1%)
Longview Fibre Co. ................................................................... 815,000 $ 12,377,812
Willamette Industries, Inc. .......................................................... 420,500 13,534,844
--------------
25,912,656
--------------
BUSINESS & CONSUMER SERVICES (15.7%)
*AccuStaff, Inc. ..................................................................... 400,000 9,200,000
*Corrections Corporation of America................................................... 450,000 16,678,125
DENTSPLY International, Inc. ......................................................... 550,000 16,775,000
*Dollar Thrifty Automotive Group, Inc. ............................................... 500,000 10,250,000
*FIserv, Inc. ........................................................................ 555,000 27,264,375
Hertz Corp. (Class A)................................................................. 484,000 19,481,000
McKesson Corp. ....................................................................... 174,100 18,835,444
*NovaCare Employee Services, Inc. .................................................... 450,000 3,600,000
*Romac International, Inc. ........................................................... 465,000 11,363,437
Service Corporation Int'l. ........................................................... 800,000 29,550,000
ServiceMaster Co. .................................................................... 450,000 13,162,500
*StaffMark, Inc. ..................................................................... 337,500 10,673,438
Unitog Co. ........................................................................... 415,000 9,233,750
--------------
196,067,069
--------------
CHEMICAL (0.8%)
IMC Global, Inc. ..................................................................... 300,000 9,825,000
--------------
CONSUMER DURABLE (1.4%)
*Furniture Brands International, Inc. ................................................ 850,000 17,425,000
--------------
CONSUMER NON-DURABLE (25.0%)
+*Abercrombie & Fitch Co. (Class A)................................................... 800,000 25,000,000
*AnnTaylor Stores Corp. .............................................................. 1,240,000 16,585,000
*Consolidated Stores Corp. ........................................................... 450,000 19,771,875
+*Gadzooks, Inc. ..................................................................... 700,000 14,700,000
*Helen of Troy Ltd. .................................................................. 1,010,000 16,286,250
*Landry's Seafood Restaurants, Inc. .................................................. 1,000,000 24,000,000
Liz Claiborne, Inc. .................................................................. 450,000 18,815,625
*Meyer (Fred), Inc. .................................................................. 1,000,000 36,375,000
Nordstrom, Inc. ...................................................................... 525,000 31,696,875
*Papa John's International, Inc. ..................................................... 600,000 20,925,000
*Planet Hollywood International, Inc. (Class A)....................................... 1,375,000 18,218,750
*Polo Ralph Lauren Corp. (Class A).................................................... 600,000 14,587,500
St. John Knits, Inc. ................................................................. 600,000 24,000,000
+*Vans, Inc. ......................................................................... 860,000 13,007,500
*Zale Corp. .......................................................................... 790,000 18,170,000
--------------
312,139,375
--------------
CONSUMER STAPLES (16.3%)
American Stores Co. .................................................................. 2,015,000 41,433,437
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
<S> <C> <C>
Hannaford Brothers Co. ............................................................... 200,000 $ 8,687,500
*Kroger Co. .......................................................................... 1,000,000 36,937,500
Libbey, Inc. ......................................................................... 350,000 13,256,250
Newell Co. ........................................................................... 400,000 17,000,000
*Quality Food Centers, Inc. .......................................................... 400,000 26,800,000
*Safeway, Inc. ....................................................................... 600,000 37,950,000
Sunbeam Corp. ........................................................................ 400,000 16,850,000
*Whole Foods Market, Inc. ............................................................ 100,000 5,112,500
--------------
204,027,187
--------------
HEALTH (14.0%)
*American Oncology Resources, Inc. ................................................... 600,000 9,600,000
*ATL Ultrasound, Inc. ................................................................ 100,000 4,600,000
*Dura Pharmaceuticals, Inc. .......................................................... 213,000 9,771,375
*Elan Corp. plc ADR................................................................... 150,000 7,678,125
*ESC Medical Systems Ltd. ............................................................ 706,500 27,376,875
*Inhale Therapeutic Systems........................................................... 100,000 2,600,000
*MedPartners, Inc. ................................................................... 50,000 1,118,750
Mentor Corp. ......................................................................... 600,000 21,900,000
Omnicare, Inc. ....................................................................... 300,000 9,300,000
*PAREXEL International Corp. ......................................................... 230,000 8,510,000
*PhyCor, Inc. ........................................................................ 300,000 8,100,000
+*ResMed, Inc. ....................................................................... 500,000 14,062,500
*Serologicals Corp. .................................................................. 500,000 13,000,000
*Sofamor Danek Group, Inc. ........................................................... 200,000 13,012,500
*Transkaryotic Therapies, Inc. ....................................................... 155,000 5,444,375
*Watson Pharmaceuticals, Inc. ........................................................ 600,000 19,462,500
--------------
175,537,000
--------------
MACHINERY & CAPITAL SPENDING (1.9%)
Applied Power, Inc. (Class A)......................................................... 134,500 9,280,500
General Cable Corp. .................................................................. 100,000 3,618,750
Parker-Hannifin Corp. ................................................................ 250,000 11,468,750
--------------
24,368,000
--------------
METAL MINING & STEEL (2.8%)
*Getchell Gold Corp. ................................................................. 800,000 19,200,000
+Schnitzer Steel Industries, Inc. (Class A)........................................... 550,000 15,434,375
--------------
34,634,375
--------------
POLLUTION CONTROL (3.9%)
*Air & Water Technologies Corp. (Class A)............................................. 1,200,100 1,350,112
*Culligan Water Technologies, Inc. ................................................... 400,000 20,100,000
*Ionics, Inc. ........................................................................ 343,000 13,419,875
+*Osmonics, Inc. ..................................................................... 869,000 13,741,063
--------------
48,611,050
--------------
</TABLE>
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<TABLE>
<CAPTION>
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PRINCIPAL
AMOUNT VALUE(1)
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<S> <C> <C>
</TABLE>
COMMON STOCKS (CONTINUED)
<TABLE>
<S> <C> <C>
REAL ESTATE SECURITIES (6.5%)
Apartment Investment & Management Co. (Class A)....................................... 114,000 $ 4,189,500
Colonial Properties Trust............................................................. 135,000 4,066,875
Equity Office Properties Trust........................................................ 123,000 3,882,187
Equity Residential Properties Trust................................................... 80,000 4,045,000
First Industrial Realty Trust, Inc. .................................................. 115,000 4,154,375
General Growth Properties, Inc. ...................................................... 111,000 4,009,875
Liberty Property Trust................................................................ 153,000 4,370,063
Macerich Co. ......................................................................... 150,000 4,275,000
Mack-Cali Realty Corp. ............................................................... 101,000 4,141,000
Manufactured Home Communities, Inc. .................................................. 150,000 4,050,000
Public Storage, Inc. ................................................................. 145,000 4,259,375
*Security Capital Group, Inc. (Class B)............................................... 350,000 11,375,000
Security Capital Industrial Trust..................................................... 163,000 4,054,625
Security Capital Pacific Trust........................................................ 160,000 3,880,000
Simon DeBartolo Group, Inc. .......................................................... 122,000 3,987,875
Spieker Properties, Inc. ............................................................. 100,000 4,287,500
*Trammell Crow Co. ................................................................... 24,000 618,000
TriNet Corporate Realty Trust, Inc. .................................................. 105,000 4,062,188
Vornado Realty Trust.................................................................. 90,000 4,224,375
--------------
81,932,813
--------------
TECHNOLOGY (4.6%)
*Apple Computer, Inc. ................................................................ 1,000,000 13,125,000
*FlexiInternational Software, Inc. ................................................... 25,000 387,500
*FORE Systems, Inc. .................................................................. 600,000 9,150,000
+*Integrated Measurement Systems, Inc. ............................................... 300,000 5,137,500
*Loral Space & Communications Corp. .................................................. 650,000 13,934,375
*VIASOFT, Inc. ....................................................................... 360,000 15,210,000
--------------
56,944,375
--------------
TRANSPORTATION (1.6%)
+*Celadon Group, Inc. ................................................................ 500,000 6,750,000
*Trans World Airlines, Inc. .......................................................... 1,300,000 13,162,500
--------------
19,912,500
--------------
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
<S> <C> <C>
UTILITIES/ELECTRIC/GAS (0.9%)
United Water Resources, Inc. ......................................................... 575,000 $ 11,248,438
--------------
Total Common Stocks
(Cost $1,080,385,133) ............................................................... 1,218,584,838
--------------
REPURCHASE AGREEMENTS (7.4%)
Goldman Sachs Corp.
6.337% dated 12/31/1997,
due 01/02/1998 in the
amount of $65,646,574.
Collateralized by U.S. Treasury Notes
5.875% due 08/31/1999................................................................ $ 65,623,788 65,623,788
J.P. Morgan Securities, Inc.
6.521% dated 12/31/1997,
due 01/02/1998 in the
amount of $27,009,648.
Collateralized by U.S. Treasury Notes
3.625% to 7.500%
due 08/31/2000 to 02/15/2005......................................................... 27,000,000 27,000,000
--------------
Total Repurchase Agreements
(Cost $92,623,788) .................................................................. 92,623,788
--------------
TOTAL INVESTMENTS (104.9%)
(Cost $1,173,008,921).................................................................... 1,311,208,626
RECEIVABLES LESS LIABILITIES (-4.9%)...................................................... (61,490,829)
--------------
NET ASSETS (100.0%)....................................................................... $1,249,717,797
--------------
--------------
</TABLE>
(1) See Note 1 of Notes to Financial Statements.
* Non-income producing.
+ Affiliated issuers (Note 1)
The accompanying notes are an integral part
of the financial statements.
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<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL
December 31, 1997 AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
COMMON STOCKS (96.7%)
AEROSPACE (1.7%)
*Orbital Sciences Corp. .............................................................. 55,000 $ 1,636,250
--------------
FINANCE (6.1%)
*Golden State Bancorp, Inc. .......................................................... 17,000 635,375
*Insignia Financial Group, Inc. (Class A)............................................. 50,000 1,150,000
North Fork Bancorp, Inc. ............................................................. 58,600 1,966,763
*Stirling Cooke Brown Holdings Ltd. .................................................. 20,400 499,800
TCF Financial Corp. .................................................................. 37,100 1,259,081
*Wilshire Financial Services Group, Inc. ............................................. 15,000 397,500
--------------
5,908,519
--------------
BUILDING & FORESTRY PRODUCTS (1.1%)
Martin Marietta Materials, Inc. ...................................................... 30,000 1,096,875
--------------
BUSINESS & CONSUMER SERVICES (8.0%)
*AccuStaff, Inc. ..................................................................... 36,000 828,000
*Billing Information Concepts Corp. .................................................. 17,000 816,000
*Family Golf Centers, Inc. ........................................................... 45,000 1,411,875
G & K Services, Inc. (Class A)........................................................ 27,800 1,167,600
*Hagler Bailly, Inc. ................................................................. 20,000 450,000
*Hall, Kinion & Associates, Inc. ..................................................... 40,000 875,000
*Lamalie Associates, Inc. ............................................................ 3,000 60,000
*Seattle FilmWorks, Inc. ............................................................. 92,000 1,023,500
Select Appointments Holdings plc ADR.................................................. 38,000 693,500
*Walsh International, Inc. ........................................................... 40,300 423,150
--------------
7,748,625
--------------
CONSUMER DURABLE (4.0%)
Clayton Homes, Inc. .................................................................. 54,900 988,200
*Coastcast Corp. ..................................................................... 90,000 1,248,750
Exide Corp. .......................................................................... 14,300 370,012
*Tower Automotive, Inc. .............................................................. 30,000 1,261,875
--------------
3,868,837
--------------
CONSUMER NON-DURABLE (10.2%)
*ACX Technologies, Inc. .............................................................. 24,000 586,500
*Bed, Bath & Beyond, Inc. ............................................................ 26,700 1,027,950
*Bon-Ton Stores, Inc. ................................................................ 63,500 952,500
*Borders Group, Inc. ................................................................. 24,500 767,156
CKE Restaurants, Inc. ................................................................ 51,800 2,182,075
*Cost Plus, Inc. ..................................................................... 51,000 1,479,000
*Day Runner, Inc. .................................................................... 20,000 810,000
*Star Buffet, Inc. ................................................................... 19,000 218,500
*Williams-Sonoma, Inc. ............................................................... 44,200 1,850,875
--------------
9,874,556
--------------
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
<S> <C> <C>
CONSUMER STAPLES (0.3%)
*Beringer Wine Estates Holdings, Inc. (Class B)....................................... 8,500 $ 323,000
--------------
ENERGY (2.9%)
*Meridian Resource Corp. ............................................................. 75,000 717,187
*Ocean Energy, Inc. .................................................................. 16,000 789,000
*Patterson Energy, Inc. .............................................................. 5,600 216,650
*Seagull Energy Corp. ................................................................ 53,000 1,093,125
--------------
2,815,962
--------------
ENERGY SERVICES (3.2%)
*Hanover Compressor Co. .............................................................. 7,000 143,062
*Tubos de Acero de Mexico SA ADR...................................................... 90,000 1,946,250
*Willbros Group, Inc. ................................................................ 65,000 975,000
--------------
3,064,312
--------------
ENTERTAINMENT & MEDIA (3.8%)
*Golden Books Family Entertainment, Inc. ............................................. 17,600 181,500
Nelson (Thomas), Inc. ................................................................ 51,000 589,687
*Regal Cinemas, Inc. ................................................................. 50,000 1,393,750
*WMS Industries, Inc. ................................................................ 68,400 1,444,950
--------------
3,609,887
--------------
HEALTH (27.6%)
*Alternative Living Services, Inc. ................................................... 44,300 1,309,619
*American Oncology Resources, Inc. ................................................... 55,500 888,000
*Assisted Living Concepts, Inc. ...................................................... 57,000 1,125,750
*ATL Ultrasound, Inc. ................................................................ 38,000 1,748,000
*Atria Communities, Inc. ............................................................. 63,000 1,078,875
*Cardiac Pathways Corp. .............................................................. 65,000 455,000
*Concentra Managed Care, Inc. ........................................................ 13,000 438,750
*ESC Medical Systems Ltd. ............................................................ 25,000 968,750
*HealthCare COMPARE Corp. ............................................................ 19,300 986,712
*FPA Medical Management, Inc. ........................................................ 54,600 1,016,925
*Health Management Systems, Inc. ..................................................... 50,000 296,875
*IDEXX Laboratories, Inc. ............................................................ 20,000 318,750
*Immunex Corp. ....................................................................... 15,000 810,000
Jones Medical Industries, Inc. ....................................................... 37,500 1,434,375
*Laser Industries Ltd. ............................................................... 75,000 2,053,125
*Ligand Pharmaceuticals, Inc. (Class B)............................................... 73,897 951,424
*MedPartners, Inc. ................................................................... 51,000 1,141,125
*MedQuist, Inc. ...................................................................... 23,450 814,887
*Protein Design Labs, Inc. ........................................................... 20,000 800,000
*Quorum Health Group, Inc. ........................................................... 50,000 1,306,250
*Somnus Medical Technologies, Inc. ................................................... 100,000 1,275,000
*Spiros Development Corp. II (Units-1 callable Common Share of Spiros & 1 Warrant of
Durable Pharmaceuticals)............................................................. 30,000 513,750
</TABLE>
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<CAPTION>
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PRINCIPAL
AMOUNT VALUE(1)
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<S> <C> <C>
</TABLE>
COMMON STOCKS (CONTINUED)
<TABLE>
<S> <C> <C>
*Thermo Cardiosystems, Inc. .......................................................... 50,000 $ 1,337,500
*Transkaryotic Therapies, Inc. ....................................................... 35,100 1,232,888
*Universal Health Services, Inc. (Class B)............................................ 30,000 1,511,250
*Watson Pharmaceuticals, Inc. ........................................................ 25,400 823,913
--------------
26,637,493
--------------
MACHINERY & CAPITAL SPENDING (1.3%)
Robbins & Myers, Inc. ................................................................ 32,000 1,268,000
--------------
METAL MINING & STEEL (0.1%)
Oregon Steel Mills, Inc. ............................................................. 3,000 63,938
--------------
POLLUTION CONTROL (1.4%)
*Allied Waste Industries, Inc. ....................................................... 55,500 1,293,844
--------------
TECHNOLOGY (24.3%)
*ADC Telecommunications, Inc. ........................................................ 13,000 542,750
*Aspect Telecommunications Corp. ..................................................... 52,000 1,085,500
*Avant! Corp. ........................................................................ 21,000 351,750
*AXENT Technologies, Inc. ............................................................ 76,800 1,324,800
*CHS Electronics, Inc. ............................................................... 30,000 513,750
*CIBER, Inc. ......................................................................... 32,000 1,856,000
*Computer Products, Inc. ............................................................. 33,800 764,725
*Davox Corp. ......................................................................... 26,900 877,613
*Eltron International, Inc. .......................................................... 41,400 1,252,350
*Engineering Animation, Inc. ......................................................... 35,100 1,614,600
*HNC Software, Inc. .................................................................. 32,000 1,376,000
*Hyperion Software Corp. ............................................................. 5,300 189,475
*Infinium Software, Inc. ............................................................. 50,000 812,500
*Intelligent Polymers, Ltd. (Units-1 Common share & 1 Warrant)........................ 22,000 486,750
*JDA Software Group, Inc. ............................................................ 3,000 105,000
*Metro Information Services, Inc. .................................................... 43,000 1,193,250
*MICROS Systems, Inc. ................................................................ 30,600 1,377,000
*Molecular Dynamics, Inc. ............................................................ 29,000 471,250
*New Era of Networks, Inc. ........................................................... 39,000 438,750
*P-COM, Inc. ......................................................................... 57,000 983,250
*Peerless Systems Corp. .............................................................. 74,000 952,750
*Platinum Software Corp. ............................................................. 80,000 940,000
*RadiSys Corp. ....................................................................... 22,000 819,500
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
<S> <C> <C>
*Security Dynamics Technologies, Inc. ................................................ 26,000 $ 929,500
*Transition Systems, Inc. ............................................................ 60,000 1,327,500
*World Access, Inc. .................................................................. 36,400 869,050
--------------
23,455,363
--------------
TRANSPORTATION (0.1%)
*Ryanair Holdings plc ADR............................................................. 3,000 75,375
--------------
UTILITIES/COMMUNICATIONS (0.6%)
*Anicom, Inc. ........................................................................ 33,400 530,225
--------------
Total Common Stocks
(Cost $83,909,185) .................................................................. 93,271,061
--------------
WARRANT (0.1%)
HEALTH (0.1%)
*Ligand Pharmaceuticals, Inc. (06/03/2000)
(Cost $44,517)....................................................................... 8,000 67,000
--------------
Total investments, excluding temporary cash
investment (Cost $83,953,702)........................................................ 93,338,061
--------------
REPURCHASE AGREEMENT (3.7%)
Goldman Sachs Corp.
6.337% dated 12/31/1997,
due 01/02/1998 in the
amount of $3,623,531.
Collateralized by U.S. Treasury Notes
5.875% due 08/31/1999
(Cost $3,622,273) ................................................................... $ 3,622,273 3,622,273
--------------
TOTAL INVESTMENTS (100.5%)
(Cost $87,575,975)....................................................................... 96,960,334
RECEIVABLES LESS LIABILITIES (-0.5%)...................................................... (529,025)
--------------
NET ASSETS (100.0%)....................................................................... $ 96,431,309
--------------
--------------
</TABLE>
(1) See Note 1 of Notes to Financial Statements.
* Non-income producing.
The accompanying notes are an integral part
of the financial statements.
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<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL
December 31, 1997 AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
COMMON STOCKS (92.4%)
REAL ESTATE
APARTMENTS (16.2%)
Apartment Investment & Management Co. (Class A)....................................... 152,200 $ 5,593,350
Associated Estates Realty Corp. ...................................................... 148,800 3,524,700
Colonial Properties Trust............................................................. 156,100 4,702,512
Equity Residential Properties Trust................................................... 91,003 4,601,339
Security Capital Pacific Trust........................................................ 256,171 6,212,147
--------------
24,634,048
--------------
OFFICE (17.2%)
Boston Properties, Inc. .............................................................. 137,000 4,529,563
Equity Office Properties Trust........................................................ 308,418 9,734,443
Mack-Cali Realty Corp. ............................................................... 189,400 7,765,400
Reckson Associates Realty Corp. ...................................................... 156,800 3,978,800
--------------
26,008,206
--------------
INDUSTRIAL (25.6%)
Alexandria Real Estate Equities, Inc. ................................................ 149,500 4,718,594
First Industrial Realty Trust, Inc. .................................................. 155,500 5,617,437
Liberty Property Trust................................................................ 186,700 5,332,619
Public Storage, Inc. ................................................................. 130,700 3,839,312
Security Capital Industrial Trust..................................................... 194,145 4,829,357
Shurgard Storage Centers, Inc. (Class A).............................................. 123,900 3,593,100
Spieker Properties, Inc. ............................................................. 103,500 4,437,562
Storage Trust Realty.................................................................. 51,200 1,347,200
TriNet Corporate Realty Trust, Inc. .................................................. 131,000 5,068,063
--------------
38,783,244
--------------
MANUFACTURED HOMES (3.0%)
Manufactured Home Communities, Inc. .................................................. 170,400 4,600,800
--------------
COMMUNITY CENTERS (11.9%)
Excel Realty Trust, Inc. ............................................................. 142,100 4,476,150
JP Realty, Inc. ...................................................................... 158,000 4,098,125
Pan Pacific Retail Properties, Inc. .................................................. 152,200 3,253,275
Vornado Realty Trust.................................................................. 131,900 6,191,056
--------------
18,018,606
--------------
SHOPPING MALLS (7.8%)
General Growth Properties, Inc. ...................................................... 143,000 5,165,875
Macerich Co. ......................................................................... 83,300 2,374,050
Simon DeBartolo Group, Inc. .......................................................... 130,856 4,277,356
--------------
11,817,281
--------------
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
<S> <C> <C>
LODGING (2.9%)
Patriot American Hospitality, Inc. ................................................... 70,200 $ 2,022,638
Starwood Lodging Trust................................................................ 40,200 2,326,575
--------------
4,349,213
--------------
OTHER (7.8%)
*Catellus Development Corp. .......................................................... 261,900 5,238,000
*Security Capital Group, Inc. (Class B)............................................... 202,900 6,594,250
--------------
11,832,250
--------------
Total Common Stocks
(Cost $112,868,719) ................................................................. 140,043,648
--------------
WARRANT (0.1%)
OTHER (0.1%)
*Security Capital Group 09/18/1997-09/18/1998
(Cost $176,224)...................................................................... 22,497 118,109
--------------
Total investments, excluding temporary cash investment
(Cost $113,044,943) ................................................................. 140,161,757
--------------
REPURCHASE AGREEMENT (7.3%)
Goldman Sachs Corp.
6.337% dated 12/31/1997,
due 01/02/1998 in the
amount of $11,044,700.
Collateralized by U.S. Treasury Notes
5.875% due 08/31/1999
(Cost $11,040,866)................................................................... $ 11,040,866 11,040,866
--------------
TOTAL INVESTMENTS (99.8%)
(Cost $124,085,809)...................................................................... 151,202,623
RECEIVABLES LESS LIABILITIES (0.2%)....................................................... 351,817
--------------
NET ASSETS (100.0%)....................................................................... $ 151,554,440
--------------
--------------
</TABLE>
(1) See Note 1 of Notes to Financial Statements.
* Non-income producing.
The accompanying notes are an integral part
of the financial statements.
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<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL
December 31, 1997 AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
COMMON STOCKS (52.3%)
FINANCE (9.3%)
Allstate Corp. ....................................................................... 84,600 $ 7,688,025
American General Corp. ............................................................... 129,100 6,979,469
Banc One Corp. ....................................................................... 100,000 5,431,250
BankAmerica Corp. .................................................................... 99,800 7,285,400
Chase Manhattan Corp. ................................................................ 60,000 6,570,000
First Union Corp. .................................................................... 206,900 10,603,625
Freddie Mac........................................................................... 301,000 12,623,187
Morgan Stanley, Dean Witter, Discover & Co. .......................................... 89,100 5,268,038
NationsBank Corp. .................................................................... 110,900 6,744,106
Travelers Property Casualty Corp. (Class A)........................................... 97,400 4,285,600
--------------
73,478,700
--------------
BUILDING & FORESTRY PRODUCTS (0.2%)
Weyerhaeuser Co. ..................................................................... 39,400 1,933,062
--------------
BUSINESS & CONSUMER SERVICES (1.9%)
*Corrections Corporation of America................................................... 124,600 4,617,987
McKesson Corp. ....................................................................... 10,000 1,081,875
Service Corporation Int'l. ........................................................... 256,400 9,470,775
--------------
15,170,637
--------------
CHEMICAL (0.5%)
du Pont (E.I.) de Nemours & Co. ...................................................... 64,000 3,844,000
--------------
CONSUMER NON-DURABLE (5.1%)
*Consolidated Stores Corp. ........................................................... 63,100 2,772,456
*Federated Department Stores, Inc. ................................................... 187,300 8,065,606
Home Depot, Inc. ..................................................................... 86,700 5,104,462
Mattel, Inc. ......................................................................... 292,350 10,890,038
*Office Depot, Inc. .................................................................. 108,100 2,587,644
Tandy Corp. .......................................................................... 166,600 6,424,513
Wal-Mart Stores, Inc. ................................................................ 123,900 4,886,306
--------------
40,731,025
--------------
CONSUMER STAPLES (6.6%)
American Stores Co. .................................................................. 168,800 3,470,950
Avon Products, Inc. .................................................................. 50,200 3,081,025
Gillette Co. ......................................................................... 49,000 4,921,437
Nabisco Holdings Corp. (Class A)...................................................... 90,100 4,364,219
PepsiCo, Inc. ........................................................................ 134,200 4,889,913
Philip Morris Cos., Inc. ............................................................. 180,100 8,160,781
Rite Aid Corp. ....................................................................... 90,000 5,281,875
*Safeway, Inc. ....................................................................... 99,400 6,287,050
Sunbeam Corp. ........................................................................ 212,000 8,930,500
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
<S> <C> <C>
Sysco Corp. .......................................................................... 67,900 $ 3,093,694
--------------
52,481,444
--------------
ENERGY (3.2%)
Burlington Resources, Inc. ........................................................... 87,535 3,922,662
Exxon Corp. .......................................................................... 98,600 6,033,088
Mobil Corp. .......................................................................... 84,400 6,092,625
Royal Dutch Petroleum Co. ............................................................ 100,700 5,456,681
Texaco, Inc. ......................................................................... 64,400 3,501,750
--------------
25,006,806
--------------
ENERGY SERVICES (0.4%)
Schlumberger Ltd. .................................................................... 34,000 2,737,000
--------------
ENTERTAINMENT & MEDIA (0.5%)
Disney (Walt) Co. .................................................................... 38,000 3,764,375
--------------
HEALTH (7.8%)
Aetna, Inc. .......................................................................... 55,500 3,916,219
American Home Products Corp. ......................................................... 102,300 7,825,950
Bristol-Myers Squibb Co. ............................................................. 89,200 8,440,550
Lilly (Eli) & Co. .................................................................... 143,800 10,012,075
Merck & Co., Inc. .................................................................... 120,300 12,781,875
Pfizer, Inc. ......................................................................... 80,000 5,965,000
Schering-Plough Corp. ................................................................ 72,800 4,522,700
*Tenet Healthcare Corp. .............................................................. 132,200 4,379,125
Warner-Lambert Co. ................................................................... 31,400 3,893,600
--------------
61,737,094
--------------
MACHINERY & CAPITAL SPENDING (4.0%)
Case Corp. ........................................................................... 40,000 2,417,500
Emerson Electric Co. ................................................................. 105,600 5,959,800
General Electric Co. ................................................................. 176,000 12,914,000
Tyco International Ltd. .............................................................. 227,626 10,257,397
--------------
31,548,697
--------------
REAL ESTATE SECURITIES (2.7%)
American Health Properties, Inc. ..................................................... 73,600 2,028,600
Equity Office Properties Trust........................................................ 63,283 1,997,370
Equity Residential Properties Trust................................................... 48,500 2,452,281
JP Realty, Inc. ...................................................................... 97,500 2,528,906
Manufactured Home Communities, Inc. .................................................. 78,000 2,106,000
Security Capital Pacific Trust........................................................ 91,800 2,226,150
Simon DeBartolo Group, Inc. .......................................................... 52,500 1,716,094
Spieker Properties, Inc. ............................................................. 53,000 2,272,375
Vornado Realty Trust.................................................................. 92,800 4,355,800
--------------
21,683,576
--------------
</TABLE>
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<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
</TABLE>
COMMON STOCKS (CONTINUED)
<TABLE>
<S> <C> <C>
TECHNOLOGY (6.2%)
Autodesk, Inc. ....................................................................... 69,100 $ 2,556,700
*Cadence Design Systems, Inc. ........................................................ 170,600 4,179,700
*Cisco Systems, Inc. ................................................................. 110,650 6,168,737
*Computer Sciences Corp. ............................................................. 75,000 6,262,500
*EMC Corp. ........................................................................... 75,000 2,057,812
Ericsson (L.M.) Telephone Co. (Class B) ADR........................................... 89,200 3,328,275
Hewlett-Packard Co. .................................................................. 76,000 4,750,000
Intel Corp. .......................................................................... 110,800 7,783,700
International Business Machines Corp. ................................................ 76,600 8,009,488
Lucent Technologies, Inc. ............................................................ 52,500 4,193,438
--------------
49,290,350
--------------
UTILITIES/COMMUNICATIONS (2.2%)
AT&T Corp. ........................................................................... 80,200 4,912,250
Bell Atlantic Corp. .................................................................. 48,100 4,377,100
MCI Communications Corp. ............................................................. 47,800 2,046,437
SBC Communications, Inc. ............................................................. 85,000 6,226,250
--------------
17,562,037
--------------
UTILITIES/ELECTRIC/GAS (1.7%)
Cinergy Corp. ........................................................................ 116,800 4,474,900
Houston Industries, Inc. ............................................................. 177,200 4,729,025
Texas Utilities Co. .................................................................. 108,300 4,501,219
--------------
13,705,144
--------------
Total Common Stocks
(Cost $415,436,102) ................................................................. 414,673,947
--------------
U.S. GOVERNMENT, FEDERAL AGENCY OBLIGATIONS (26.6%)
U.S. TREASURY BONDS & NOTES (7.3%)
U.S. Treasury Bonds
12.000% 05/15/2005................................................................... $ 4,005,000 5,476,837
8.875% 08/15/2017................................................................... 8,970,000 11,903,468
8.125% 08/15/2019................................................................... 2,350,000 2,941,173
U.S. Treasury Notes
6.125% 08/31/1998................................................................... 7,640,000 7,665,067
8.875% 02/15/1999................................................................... 28,675,000 29,651,757
--------------
57,638,302
--------------
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION (GNMA) (0.2%)
7.500% 08/15/2027 - 10/15/2027...................................................... 1,534,643 1,572,042
--------------
FEDERAL HOUSING ADMINISTRATION (FHA) (0.6%)
FHA Insured Project Pool #23-11059
7.700% 08/01/2028................................................................... 1,609,689 1,643,186
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
<S> <C> <C>
FHA Insured Project Pool #55
7.430% 04/01/2022................................................................... $ 1,898,328 $ 1,984,949
FHA Insured Project Pool #53-43077
9.125% 07/25/2033................................................................... 1,098,642 1,178,898
--------------
4,807,033
--------------
AGENCY COLLATERALIZED MORTGAGE OBLIGATIONS (18.5%)
FHLMC Multiclass Mtg. Partn. Ctfs.
Gtd. Series 1233 Cl. H
7.000% 04/15/2007................................................................... 600,000 618,000
FHLMC Multiclass Mtg. Partn. Ctfs.
Gtd. Series 1543 Cl. XN
7.000% 07/15/2023................................................................... 5,617,000 5,804,538
FHLMC Multiclass Mtg. Partn. Ctfs.
Gtd. Series 1627 Cl. EA
6.000% 05/15/2023................................................................... 1,817,000 1,678,561
FHLMC Multiclass Mtg. Partn. Ctfs.
Gtd. Series 1763 Cl. H
8.250% 07/15/2023................................................................... 130,000 139,275
FHLMC Multiclass Mtg. Partn. Ctfs.
Gtd. Series 1895 Cl. B
7.500% 12/15/2023................................................................... 3,940,000 4,044,646
FHLMC Multiclass Mtg. Partn. Ctfs.
Gtd. Series 1904 Cl. C
7.250% 08/15/2024................................................................... 3,490,000 3,543,432
FHLMC Multiclass Mtg. Partn. Ctfs.
Gtd. Series 1910 Cl. D
8.000% 11/15/2024................................................................... 1,883,000 1,979,752
FHLMC Multiclass Mtg. Partn. Ctfs.
Gtd. Series 1933 Cl. C
7.000% 03/15/2025................................................................... 2,440,000 2,462,043
FHLMC Multiclass Mtg. Partn. Ctfs.
Gtd. Series 1933 Cl. AE
7.000% 03/15/2025................................................................... 2,060,000 2,076,987
FHLMC Multiclass Mtg. Partn. Ctfs.
Gtd. Series 1933 Cl. VC
7.550% 03/15/2012................................................................... 2,950,000 3,123,148
FHLMC Multiclass Mtg. Partn. Ctfs.
Gtd. Series 1941 Cl. C
6.750% 06/15/2022................................................................... 2,690,000 2,690,834
FHLMC Multiclass Mtg. Partn. Ctfs.
Gtd. Series 1971 Cl. A
7.500% 07/15/2027................................................................... 3,000,000 3,114,001
FHLMC Multiclass Mtg. Partn. Ctfs.
Gtd. Series 1971 Cl. E
7.500% 01/20/2024................................................................... 16,580,000 17,035,535
</TABLE>
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<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
</TABLE>
U.S. GOVERNMENT, FEDERAL AGENCY OBLIGATIONS (CONTINUED)
<TABLE>
<S> <C> <C>
FHLMC Multiclass Mtg. Partn. Ctfs.
Gtd. Series 1995 Cl. A
7.500% 08/20/2027................................................................... $ 7,200,000 $ 7,460,732
FHLMC Multiclass Mtg. Partn. Ctfs.
Gtd. Series 1995 Cl. D
7.500% 08/20/2012................................................................... 5,150,000 5,244,264
FHLMC GNMA Multiclass Mtg. Partn. Ctfs.
Gtd. Series 40 Cl. N
6.500% 05/17/2021................................................................... 7,180,000 7,039,523
FHLMC GNMA Multiclass Mtg. Partn. Ctfs.
Gtd. Series 62 Cl. B
7.500% 05/20/2024................................................................... 3,756,000 3,870,075
FNMA Gtd. REMIC Pass Thru Ctf. REMIC Tr. 1994-10 Cl. UU
6.500% 01/25/2024................................................................... 857,000 829,368
FNMA Gtd. REMIC Pass Thru Ctf. REMIC Tr. 1997-G1 Cl. B
7.500% 06/20/2024................................................................... 3,910,000 4,044,387
FNMA Gtd. REMIC Pass Thru Ctf. REMIC Tr. 1997-G4 Cl. C
7.500% 06/17/2024................................................................... 6,650,000 6,848,514
FNMA Gtd. REMIC Pass Thru Ctf. REMIC Tr. 1997-G5 Cl. VA
7.500% 07/17/2012................................................................... 5,700,000 6,007,780
FNMA Gtd. REMIC Pass Thru Ctf. REMIC Tr. 1997-27 Cl. B
7.000% 02/18/2025................................................................... 3,020,000 3,034,710
FNMA Gtd. REMIC Pass Thru Ctf. REMIC Tr. 1997-38 Cl. L
7.500% 02/17/2012................................................................... 1,760,000 1,774,087
FNMA Gtd. REMIC Pass Thru Ctf. REMIC Tr. 1997-39 Cl. B
7.500% 05/17/2027................................................................... 1,530,000 1,603,606
FNMA Gtd. REMIC Pass Thru Ctf. REMIC Tr. 1997-46 Cl. B
7.500% 03/17/2025................................................................... 3,900,000 4,003,252
FNMA Gtd. REMIC Pass Thru Ctf. REMIC Tr. 1997-63 Cl. PH
7.000% 07/18/2026................................................................... 6,510,000 6,673,970
FNMA Gtd. REMIC Pass Thru Ctf. REMIC Tr. 1997-74 Cl. D
7.500% 09/20/2023................................................................... 9,775,000 10,042,634
GNMA Gtd. REMIC Pass Thru Secs. REMIC Tr. 1996-15 Cl. B
7.500% 08/20/2020................................................................... 8,493,000 8,703,975
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
<S> <C> <C>
GNMA Gtd. REMIC Pass Thru Secs. REMIC Tr. 1997-4 Cl. B
7.000% 08/16/2026................................................................... $ 4,214,914 $ 4,262,908
GNMA Gtd. REMIC Pass Thru Secs. REMIC Tr. 1997-4 Cl. C
7.000% 03/20/2027................................................................... 3,877,000 3,913,037
GNMA Gtd. REMIC Pass Thru Secs. REMIC Tr. 1997-4 Cl. M
7.500% 02/16/2012................................................................... 3,530,000 3,620,439
GNMA Gtd. REMIC Pass Thru Secs. REMIC Tr. 1997-4 Cl. N
7.500% 02/16/2027................................................................... 3,372,500 3,492,629
GNMA Gtd. REMIC Pass Thru Secs. REMIC Tr. 1997-11 Cl. M
8.000% 05/16/2024................................................................... 4,890,000 5,128,768
Puerto Rico Housing Finance Corp.
Series A Cl. 4
9.000% 07/20/2017................................................................... 477,433 477,433
--------------
146,386,843
--------------
Total U.S. Government,
Federal Agency Obligations
(Cost $205,197,469) ................................................................. 210,404,220
--------------
OTHER SECURITIZED LOANS (7.0%)
COLLATERALIZED MORTGAGE OBLIGATIONS (5.3%)
BA Mortgage Securities, Inc.
Series 1997-2 Cl. 1A-3
7.400% 10/25/2027................................................................... 2,952,561 2,978,004
Bear Stearns Mortgage Securities, Inc.
Series 1996-2 Cl. A1
6.758% 01/25/2025................................................................... 4,522,414 4,506,779
Bear Stearns Mortgage Securities, Inc.
Series 1996-8 Cl. A9
7.600% 11/25/2027................................................................... 4,607,000 4,711,413
Bear Stearns Structured Securities, Inc. (144A)
Series 1995-1 Cl. A
6.727% 09/25/2024................................................................... 3,138,131 3,041,811
CWHL, Inc. Mtg. Pass Thru Ctf.
Series 1997-3 Cl. A10
7.500% 06/25/2027................................................................... 4,569,141 4,635,487
GE Capital Mortgage Services, Inc.
Series 1997-8 Cl. A6
7.250% 10/25/2027................................................................... 2,460,000 2,518,579
Headlands Mortgage Securities, Inc.
Series 1997-3 Cl. A-1-6
7.000% 07/25/2027................................................................... 4,810,000 4,828,890
</TABLE>
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<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
</TABLE>
OTHER SECURITIZED LOANS (CONTINUED)
<TABLE>
<S> <C> <C>
Mortgage Obligation Structured Trust (144A)
Series 1993-1 Cl. B1
10.668% 10/25/2018................................................................... $ 3,616,915 $ 3,785,897
Norwest Asset Securities Corp.
Series 1997-16 Cl. A2
6.750% 10/25/2027................................................................... 5,385,900 5,345,609
PNC Mortgage Securities Corp.
Series 1997-4 Cl. 2PP2
7.500% 07/25/2027................................................................... 2,750,000 2,798,242
Residential Funding Mortgage Securities I, Inc.
Series 1997-S7 Cl. A-3
7.500% 05/25/2027................................................................... 3,051,000 3,143,418
--------------
42,294,129
--------------
ASSET BACKED SECURITIES (1.7%)
Green Tree Financial Corp.
Series 1995-8 Cl. A2
6.150% 12/15/2026................................................................... 2,620,024 2,620,024
Green Tree Financial Corp.
Series 1996-7 Cl. A2
6.300% 10/15/2027................................................................... 3,320,000 3,321,029
Lehman FHA Title I Loan Trust
Series 1995-6 Cl. A-2
6.630% 05/25/2007................................................................... 5,422,573 5,409,384
The Money Store Residential Trust
Series 1997-II Cl. A4
7.385% 01/15/2029................................................................... 1,982,000 2,009,867
--------------
13,360,304
--------------
Total Other Securitized Loans
(Cost $54,776,885) .................................................................. 55,654,433
--------------
CORPORATE BONDS (12.7%)
INDUSTRIAL (5.9%)
Allied Holdings, Inc. Series B
8.625% 10/01/2007................................................................... 500,000 507,500
American Home Products Corp.
7.700% 02/15/2000................................................................... 4,600,000 4,735,102
Amgen, Inc.
8.125% 04/01/2097................................................................... 2,425,000 2,674,193
Cinemark USA, Inc. Series B
9.625% 08/01/2008................................................................... 350,000 361,375
Coca-Cola Enterprises, Inc.
6.375% 08/01/2001................................................................... 4,000,000 4,028,440
Eckerd Corp.
9.250% 02/15/2004................................................................... 4,000,000 4,396,680
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
<S> <C> <C>
Ethan Allen, Inc.
8.750% 03/15/2001................................................................... $ 3,450,000 $ 3,527,625
Federal Express Corp. Pass Thru Trust
Series 1997-1C
7.650% 01/15/2014................................................................... 2,200,000 2,350,854
Georgia-Pacific Corp.
9.950% 06/15/2002................................................................... 3,061,000 3,464,287
Hilton Hotels Corp.
7.375% 06/01/2002................................................................... 3,500,000 3,593,520
Johns Manville International Grp.
10.875% 12/15/2004................................................................... 1,500,000 1,665,000
Jones Intercable, Inc.
8.875% 04/01/2007................................................................... 300,000 313,500
Lenfest Communications, Inc.
8.375% 11/01/2005................................................................... 650,000 667,875
Nabisco, Inc.
6.700% 06/15/2002................................................................... 2,000,000 2,025,680
Santa Fe Pacific Gold Corp.
8.375% 07/01/2005................................................................... 5,100,000 5,493,720
Teekay Shipping Corp. Guaranteed First Preferred Shipping Mtg. Notes
8.320% 02/01/2008................................................................... 1,000,000 1,020,000
Tenet Healthcare Corp.
10.125% 03/01/2005................................................................... 900,000 983,250
Time Warner Entertainment Co. L.P.
9.625% 05/01/2002................................................................... 1,900,000 2,122,737
8.375% 03/15/2023................................................................... 1,320,000 1,506,357
UCAR Global Enterprises Series B
12.000% 01/15/2005................................................................... 1,000,000 1,120,000
--------------
46,557,695
--------------
FINANCIAL (5.8%)
Abn Amro Bank N. V. Chicago
7.550% 06/28/2006................................................................... 3,575,000 3,825,393
Bankamerica Corp.
5.938% 02/20/2002................................................................... 3,800,000 3,788,030
Aetna Services, Inc.
7.625% 08/15/2026................................................................... 3,500,000 3,683,295
Bear Stearns Cos., Inc.
Series B Medium Term Notes
5.779% 10/10/2000................................................................... 7,825,000 7,802,777
Caterpillar Financial Services Corp.
Medium Term Notes
6.350% 12/01/1998................................................................... 1,590,000 1,592,179
Commercial Credit Group, Inc.
6.625% 06/01/2015................................................................... 1,250,000 1,291,325
</TABLE>
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<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
</TABLE>
CORPORATE BONDS (CONTINUED)
<TABLE>
<S> <C> <C>
ERP Operating Limited Partnership (144A)
8.500% 05/15/1999................................................................... $ 2,700,000 $ 2,775,681
First Security Corp.
7.875% 10/15/1999................................................................... 1,325,000 1,361,000
+Fleet Mortgage Group, Inc.
6.500% 09/15/1999................................................................... 550,000 552,937
Goldman Sachs Group L.P. (144A)
Medium Term Notes
7.200% 03/01/2007................................................................... 2,800,000 2,905,224
Hartford Life, Inc.
7.650% 06/15/2027................................................................... 2,555,000 2,702,398
Liberty Property L.P.
7.100% 08/15/2004................................................................... 3,525,000 3,605,934
Morgan Stanley Group, Inc.
Medium Term Notes
5.750% 02/15/2001................................................................... 2,100,000 2,070,978
Security Capital Industrial
Medium Term Notes
7.810% 02/01/2015................................................................... 3,250,000 3,403,725
Simon DeBartolo Group, L.P.
7.125% 09/20/2007................................................................... 2,300,000 2,360,076
Spieker Properties L.P.
6.900% 01/15/2004................................................................... 2,450,000 2,477,538
--------------
46,198,490
--------------
UTILITY (0.5%)
GTE North, Inc.
5.500% 02/15/1999................................................................... 2,905,000 2,886,030
Worldcom, Inc.
8.875% 01/15/2006................................................................... 1,000,000 1,075,920
--------------
3,961,950
--------------
YANKEE (0.5%)
Hydro-Quebec
8.400% 01/15/2022................................................................... 2,155,000 2,538,418
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
<S> <C> <C>
Ontario Province CDA
6.000% 02/21/2006................................................................... $ 1,725,000 $ 1,698,383
--------------
4,236,801
--------------
Total Corporate Bonds
(Cost $99,154,016) .................................................................. 100,954,936
--------------
Total investments, excluding temporary
cash investments
(Cost $687,367,178) ................................................................. 781,687,536
--------------
REPURCHASE AGREEMENT (2.4%)
Goldman Sachs Corp.
6.337% dated 12/31/1997,
due 01/02/1998 in the
amount of $18,645,686.
Collateralized by U.S. Treasury Notes
5.875% due 08/31/1999
(Cost $18,639,214)................................................................... 18,639,214 18,639,214
--------------
TOTAL INVESTMENTS (101.0%)
(Cost $706,006,392)...................................................................... 800,326,750
--------------
RECEIVABLES LESS LIABILITIES (-1.0%)...................................................... (7,948,494)
--------------
NET ASSETS (100.0%)....................................................................... $ 792,378,256
--------------
--------------
</TABLE>
(1) See Note 1 of Notes to Financial Statements.
* Non-income producing.
+ Affiliated issuers. (Note 1)
The accompanying notes are an integral part
of the financial statements.
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<TABLE>
<CAPTION>
PRINCIPAL
December 31, 1997 AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
COMMERCIAL PAPER (90.1%)
A. I. Credit Corp.
6.080% 01/06/1998................................................................... $ 4,510,000 $ 4,505,430
Air Products & Chemicals, Inc.
5.950% 01/07/1998................................................................... 5,000,000 4,994,215
Alabama Power Co.
5.910% 01/05/1998................................................................... 3,325,000 3,322,271
5.860% 01/06/1998................................................................... 5,000,000 4,995,117
6.000% 01/06/1998................................................................... 10,000,000 9,990,000
American General Finance Corp.
5.550% 01/28/1998................................................................... 5,000,000 4,978,417
5.500% 02/02/1998................................................................... 7,000,000 6,964,708
5.500% 02/11/1998................................................................... 5,000,000 4,967,917
5.720% 02/27/1998................................................................... 10,000,000 9,907,845
Ameritech Capital Funding Corp.
5.570% 01/29/1998................................................................... 5,000,000 4,977,565
Archer-Daniels-Midland Co.
6.200% 01/06/1998................................................................... 5,000,000 4,994,833
5.570% 01/21/1998................................................................... 6,000,000 5,980,505
5.530% 01/22/1998................................................................... 10,000,000 9,966,206
5.670% 02/11/1998................................................................... 5,000,000 4,966,925
5.700% 03/05/1998................................................................... 6,000,000 5,939,200
Associates Corp. of North America
6.740% 01/02/1998................................................................... 21,100,000 21,092,099
Atlantic Richfield Co.
5.580% 01/22/1998................................................................... 3,000,000 2,989,770
Avco Financial Services, Inc.
5.690% 03/02/1998................................................................... 5,000,000 4,951,794
5.680% 03/04/1998................................................................... 6,000,000 5,940,360
5.690% 03/04/1998................................................................... 6,000,000 5,940,255
5.690% 03/05/1998................................................................... 10,000,000 9,898,845
B.P. America, Inc.
6.100% 01/05/1998................................................................... 5,000,000 4,995,764
6.300% 01/05/1998................................................................... 5,000,000 4,995,625
6.000% 01/20/1998................................................................... 2,500,000 2,491,667
Bank of America, FSB
5.800% 01/12/1998................................................................... 5,000,000 4,990,333
5.570% 01/26/1998................................................................... 10,000,000 9,959,772
BankAmerica Corp.
5.530% 01/28/1998................................................................... 10,000,000 9,956,989
Barclays U.S. Funding Corp.
8.250% 01/02/1998................................................................... 10,000,000 9,995,417
8.500% 01/02/1998................................................................... 10,000,000 9,995,278
5.590% 01/27/1998................................................................... 7,000,000 6,970,653
Becton, Dickinson & Co.
6.150% 01/09/1998................................................................... 2,633,000 2,628,952
<CAPTION>
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
<S> <C> <C>
Bell Atlantic Financial Services, Inc.
5.800% 01/09/1998................................................................... $ 10,000,000 $ 9,985,500
5.820% 01/13/1998................................................................... 19,000,000 18,960,068
Beneficial Corp.
5.630% 01/20/1998................................................................... 6,000,000 5,981,233
Brown-Forman Corp.
6.250% 01/06/1998................................................................... 4,755,000 4,750,047
CIT Group Holdings, Inc.
5.500% 02/02/1998................................................................... 5,000,000 4,974,792
5.500% 02/05/1998................................................................... 5,000,000 4,972,500
5.560% 02/09/1998................................................................... 7,000,000 6,956,756
5.720% 03/10/1998................................................................... 10,000,000 9,890,367
Cargill, Inc.
5.620% 03/03/1998................................................................... 15,000,000 14,854,817
Cargill Financial Services Corp.
5.640% 02/26/1998................................................................... 10,000,000 9,910,700
Chevron Transport Co.
5.550% 02/10/1998................................................................... 7,000,000 6,955,754
5.680% 03/06/1998................................................................... 5,000,000 4,948,723
5.700% 04/15/1998................................................................... 10,000,000 9,833,750
5.720% 04/17/1998................................................................... 6,000,000 5,897,994
Clorox Co.
5.680% 01/16/1998................................................................... 5,000,000 4,987,378
5.730% 02/23/1998................................................................... 5,000,000 4,957,025
5.730% 02/24/1998................................................................... 10,000,000 9,912,459
Commercial Credit Co.
5.500% 02/04/1998................................................................... 10,000,000 9,946,528
5.530% 02/04/1998................................................................... 5,000,000 4,973,118
5.600% 02/04/1998................................................................... 3,000,000 2,983,667
5.530% 02/05/1998................................................................... 10,000,000 9,944,700
Deere (John) Credit Co.
5.590% 01/20/1998................................................................... 5,000,000 4,984,472
Deere (John) Capital Corp.
5.560% 01/30/1998................................................................... 7,000,000 6,967,567
Disney (Walt) Co.
5.580% 02/23/1998................................................................... 10,000,000 9,916,300
5.600% 02/24/1998................................................................... 5,000,000 4,957,223
5.650% 03/27/1998................................................................... 7,000,000 6,905,520
Dow Jones & Co., Inc.
5.950% 01/14/1998................................................................... 1,900,000 1,895,604
duPont (E.I.) de Nemours & Co.
5.600% 01/20/1998................................................................... 1,600,000 1,595,022
5.520% 01/22/1998................................................................... 5,000,000 4,983,133
5.490% 02/03/1998................................................................... 5,000,000 4,974,075
5.670% 02/25/1998................................................................... 5,000,000 4,955,900
Florida Power Corp.
5.900% 01/12/1998................................................................... 10,000,000 9,980,333
5.880% 02/10/1998................................................................... 3,000,000 2,979,910
</TABLE>
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<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
</TABLE>
COMMERCIAL PAPER (CONTINUED)
<TABLE>
<S> <C> <C>
Ford Motor Credit Co.
6.170% 01/05/1998................................................................... $ 5,000,000 $ 4,995,715
5.920% 01/06/1998................................................................... 4,800,000 4,795,264
5.570% 01/21/1998................................................................... 8,000,000 7,974,007
5.570% 01/26/1998................................................................... 5,000,000 4,979,886
5.570% 02/03/1998................................................................... 15,000,000 14,921,092
General Electric Capital Corp.
5.830% 01/07/1998................................................................... 10,000,000 9,988,664
5.550% 02/06/1998................................................................... 15,000,000 14,914,437
5.580% 02/13/1998................................................................... 8,000,000 7,945,440
5.680% 03/11/1998................................................................... 5,000,000 4,944,778
Glaxo Wellcome plc
5.570% 01/21/1998................................................................... 5,000,000 4,983,754
5.670% 03/02/1998................................................................... 5,000,000 4,951,962
5.700% 03/10/1998................................................................... 7,000,000 6,923,525
5.670% 03/16/1998................................................................... 5,000,000 4,940,938
Goldman Sachs Group L.P.
5.870% 01/09/1998................................................................... 10,000,000 9,985,325
5.800% 01/15/1998................................................................... 5,000,000 4,987,917
5.650% 02/20/1998................................................................... 2,000,000 1,983,992
Hewlett-Packard Co.
6.200% 01/08/1998................................................................... 1,000,000 998,622
5.950% 01/21/1998................................................................... 5,376,000 5,357,341
Household Finance Corp.
5.700% 01/16/1998................................................................... 5,000,000 4,987,333
5.550% 02/09/1998................................................................... 8,000,000 7,950,667
5.670% 02/17/1998................................................................... 5,000,000 4,962,200
5.580% 02/20/1998................................................................... 10,000,000 9,920,950
Idaho Power Co.
5.860% 01/13/1998................................................................... 5,000,000 4,989,420
McGraw-Hill Companies, Inc.
5.580% 01/29/1998................................................................... 6,000,000 5,973,030
5.670% 03/19/1998................................................................... 4,600,000 4,543,489
Merrill Lynch & Co., Inc.
5.850% 01/15/1998................................................................... 10,000,000 9,975,625
5.640% 01/20/1998................................................................... 2,800,000 2,791,227
5.560% 02/11/1998................................................................... 10,000,000 9,935,134
5.610% 02/25/1998................................................................... 10,000,000 9,912,734
5.680% 02/27/1998................................................................... 2,500,000 2,477,122
5.690% 02/27/1998................................................................... 2,500,000 2,477,082
MetLife Funding, Inc.
5.700% 01/16/1998................................................................... 10,000,000 9,974,667
5.680% 01/22/1998................................................................... 2,000,000 1,993,058
5.660% 02/12/1998................................................................... 5,000,000 4,966,197
5.660% 02/17/1998................................................................... 5,000,000 4,962,267
5.660% 02/19/1998................................................................... 5,000,000 4,960,695
<CAPTION>
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
<S> <C> <C>
Minnesota Mining & Manufacturing Co.
5.580% 02/18/1998................................................................... $ 5,000,000 $ 4,962,025
5.580% 02/19/1998................................................................... 15,000,000 14,883,750
Monsanto Co.
6.300% 01/05/1998................................................................... 5,000,000 4,995,625
5.820% 01/08/1998................................................................... 10,000,000 9,987,066
6.250% 01/08/1998................................................................... 10,000,000 9,986,111
5.950% 01/15/1998................................................................... 3,843,000 3,833,473
6.020% 01/16/1998................................................................... 5,000,000 4,986,622
Morgan Stanley Group, Inc.
5.800% 01/15/1998................................................................... 2,000,000 1,995,167
5.530% 01/27/1998................................................................... 5,000,000 4,979,263
5.530% 01/30/1998................................................................... 10,000,000 9,953,917
5.590% 02/17/1998................................................................... 10,000,000 9,925,467
Nalco Chemical Co.
5.700% 03/09/1998................................................................... 10,000,000 9,892,334
5.710% 03/20/1998................................................................... 10,000,000 9,874,697
5.700% 03/23/1998................................................................... 10,000,000 9,870,167
National Rural Utilities Cooperative Finance Corp.
6.150% 01/09/1998................................................................... 2,800,000 2,795,695
5.670% 03/09/1998................................................................... 5,000,000 4,946,450
5.690% 03/09/1998................................................................... 5,000,000 4,946,262
5.650% 03/12/1998................................................................... 10,000,000 9,888,570
5.690% 03/23/1998................................................................... 6,000,000 5,922,237
Norwest Financial, Inc.
5.820% 01/13/1998................................................................... 5,000,000 4,989,492
5.820% 01/14/1998................................................................... 10,000,000 9,977,367
5.790% 01/27/1998................................................................... 4,000,000 3,982,630
5.790% 01/30/1998................................................................... 3,000,000 2,985,525
5.700% 02/24/1998................................................................... 5,000,000 4,956,459
PacifiCorp
5.750% 01/23/1998................................................................... 2,000,000 1,992,653
5.770% 02/02/1998................................................................... 2,963,000 2,947,328
5.720% 02/26/1998................................................................... 10,000,000 9,909,434
Procter & Gamble Co.
5.570% 02/18/1998................................................................... 3,000,000 2,977,256
Prudential Funding Corp.
5.510% 01/23/1998................................................................... 5,000,000 4,982,399
5.520% 01/26/1998................................................................... 5,000,000 4,980,067
5.570% 01/28/1998................................................................... 5,000,000 4,978,339
5.510% 01/29/1998................................................................... 13,000,000 12,942,298
SBC Communications, Inc.
5.760% 01/20/1998................................................................... 5,000,000 4,984,000
St. Paul Cos., Inc.
5.580% 02/05/1998................................................................... 5,000,000 4,972,100
5.580% 02/09/1998................................................................... 5,000,000 4,969,000
5.580% 02/13/1998................................................................... 2,000,000 1,986,360
</TABLE>
46
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[LOGO]
- ----------------------- -----------------------
-- COLUMBIA DAILY INCOME COMPANY --
-----------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
</TABLE>
COMMERCIAL PAPER (CONTINUED)
<TABLE>
<S> <C> <C>
Sonoco Products Co.
6.800% 01/02/1998................................................................... $ 16,933,000 $ 16,926,603
Southern California Gas Co.
5.550% 01/23/1998................................................................... 3,000,000 2,989,363
5.580% 01/23/1998................................................................... 8,000,000 7,971,480
Southern New England Telecom
5.850% 01/05/1998................................................................... 2,221,000 2,219,195
Texaco, Inc.
5.880% 01/09/1998................................................................... 10,000,000 9,985,300
5.730% 03/06/1998................................................................... 10,000,000 9,896,542
USAA Capital Corp.
5.570% 02/12/1998................................................................... 15,000,000 14,900,204
5.570% 02/13/1998................................................................... 6,400,000 6,356,430
5.680% 04/07/1998................................................................... 5,000,000 4,923,479
Washington Gas Light Co.
5.570% 02/02/1998................................................................... 8,000,000 7,959,154
5.700% 02/18/1998................................................................... 6,800,000 6,747,244
Washington Post Co.
6.080% 01/07/1998................................................................... 10,000,000 9,988,178
Weyerhaeuser Real Estate Co.
5.820% 01/06/1998................................................................... 5,000,000 4,995,150
5.820% 01/07/1998................................................................... 5,000,000 4,994,342
5.820% 01/08/1998................................................................... 10,000,000 9,987,067
5.800% 01/12/1998................................................................... 10,000,000 9,980,667
Xerox Credit Corp.
5.530% 01/27/1998................................................................... 4,000,000 3,983,410
5.540% 02/10/1998................................................................... 10,000,000 9,936,906
5.650% 02/20/1998................................................................... 6,000,000 5,951,975
5.650% 03/24/1998................................................................... 5,000,000 4,934,868
--------------
Total Commercial Paper
(Cost $1,053,008,380) ............................................................... 1,053,008,380
--------------
<CAPTION>
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
<S> <C> <C>
REPURCHASE AGREEMENTS (10.3%)
Goldman Sachs Corp.
6.337% dated 12/31/1997,
due 01/02/1998 in the
amount of $649,533.
Collateralized by U.S. Treasury Notes
5.875% due 08/31/1999................................................................ $ 649,308 $ 649,308
J.P. Morgan Securities, Inc.
6.521% dated 12/31/1997,
due 01/02/1998 in the
amount of $60,021,440.
Collateralized by U.S. Treasury Notes
3.625% to 7.500%
due 08/31/2000 to 02/15/2005......................................................... 60,000,000 60,000,000
Merrill Lynch
6.388% dated 12/31/1997,
due 01/02/1998 in the
amount of $60,021,000.
Collateralized by U.S. Treasury Bonds
6.250% to 7.625%
due 02/15/2023 to 08/15/2025......................................................... 60,000,000 60,000,000
--------------
Total Repurchase Agreements
(Cost $120,649,308) ................................................................. 120,649,308
--------------
TOTAL INVESTMENTS (100.4%)
(Cost $1,173,657,688, including $6,537,187 accrued interest receivable).................. 1,173,657,688
CASH AND RECEIVABLES LESS LIABILITIES (-0.4%)............................................. (4,562,120)
--------------
NET ASSETS (100.0%)....................................................................... $1,169,095,568
--------------
--------------
</TABLE>
(1) See Note 1 of Notes to Financial Statements.
The accompanying notes are an integral part
of the financial statements.
47
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[LOGO]
- -------------- --------------
-- COLUMBIA U.S. GOVERNMENT SECURITIES FUND, INC. --
----------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
December 31, 1997 AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
U.S. TREASURY NOTES (98.1%)
6.875% 08/31/1999................................................................... $ 7,675,000 $ 7,818,906
5.875% 11/15/1999................................................................... 16,225,000 16,280,782
5.875% 02/15/2000................................................................... 9,750,000 9,786,562
6.000% 08/15/2000................................................................... 3,200,000 3,224,000
--------------
Total U.S. Treasury Notes
(Cost $37,019,300) .................................................................. 37,110,250
REPURCHASE AGREEMENT (1.3%)
Goldman Sachs Corp.
6.337% dated 12/31/1997,
due 01/02/1998 in the
amount of $489,830.
Collateralized by U.S. Treasury Notes
5.875% due 08/31/1999.
(Cost $489,660) ..................................................................... 489,660 489,660
--------------
TOTAL INVESTMENTS (99.4%)
(Cost $37,508,960)....................................................................... 37,599,910
RECEIVABLES LESS LIABILITIES (0.6%)....................................................... 236,765
--------------
NET ASSETS (100.0%)....................................................................... $ 37,836,675
--------------
--------------
</TABLE>
(1) See Note 1 of Notes to Financial Statements.
The accompanying notes are an integral part
of the financial statements.
48
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[LOGO]
- ---------------- ----------------
-- COLUMBIA FIXED INCOME SECURITIES FUND, INC. --
-------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
December 31, 1997 AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
U.S. GOVERNMENT, FEDERAL AGENCY OBLIGATIONS (55.8%)
U.S. TREASURY BONDS & NOTES (12.8%)
U.S. Treasury Bonds
8.875% 08/15/2017................................................................... $ 14,630,000 $ 19,414,464
8.125% 08/15/2019................................................................... 5,000,000 6,257,815
U.S. Treasury Notes
6.125% 08/31/1998................................................................... 23,054,000 23,129,640
--------------
48,801,919
--------------
OTHER GOVERNMENT AGENCY OBLIGATIONS (1.4%)
Farm Credit Systems Financial Assistance Corp. Series A
9.375% 07/21/2003................................................................... 4,660,000 5,408,489
--------------
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION (GNMA) (2.9%)
7.500% 10/15/2026 - 10/15/2027...................................................... 10,640,503 10,899,812
--------------
FEDERAL HOUSING ADMINISTRATION (FHA) (1.4%)
FHA Insured Project Pool #2022
7.430% 12/01/2020................................................................... 1,720,239 1,729,649
FHA Insured Project Pool #1984-D
9.680% 02/01/2024................................................................... 268,635 280,807
FHA Insured Project Pool #051-11078
8.350% 04/01/2030................................................................... 2,217,205 2,323,077
FHA Insured Project Pool #092-35499
8.450% 11/15/2031................................................................... 789,545 829,519
--------------
5,163,052
--------------
AGENCY COLLATERALIZED MORTGAGE OBLIGATIONS (37.3%)
FHLMC Multiclass Mtg. Partn. Ctfs. Gtd.
Series 1558 Cl. C
6.500% 07/15/2023................................................................... 2,084,000 2,058,835
FHLMC Multiclass Mtg. Partn. Ctfs. Gtd.
Series 1971 Cl. A
7.500% 07/15/2027................................................................... 4,041,000 4,194,560
FHLMC Multiclass Mtg. Partn. Ctfs. Gtd.
Series 1971 Cl. E
7.500% 01/20/2024................................................................... 16,646,000 17,103,349
FHLMC Multiclass Mtg. Partn. Ctfs. Gtd.
Series 1995 Cl. A
7.500% 08/20/2027................................................................... 1,750,000 1,813,372
FHLMC Multiclass Mtg. Partn. Ctfs. Gtd.
Series 1995 Cl. D
7.500% 08/20/2012................................................................... 9,155,000 9,322,569
FHLMC GNMA Multiclass Mtg. Partn. Ctfs. Gtd. Series 40 Cl. N
6.500% 05/17/2021................................................................... 4,700,000 4,608,044
<CAPTION>
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
<S> <C> <C>
FHLMC Multiclass Mtg. Partn. Ctfs. Gtd.
Series 1763 Cl. H
8.250% 07/15/2023................................................................... $ 692,000 $ 741,370
FHLMC Multiclass Mtg. Partn. Ctfs. Gtd.
Series 1910 Cl. D
8.000% 11/15/2024................................................................... 1,850,000 1,945,057
FHLMC Multiclass Mtg. Partn. Ctfs. Gtd.
Series 1920 Cl. N
7.000% 02/15/2026................................................................... 3,110,000 3,110,000
FHLMC Multiclass Mtg. Partn. Ctfs. Gtd.
Series 1941 Cl. C
6.750% 06/15/2022................................................................... 2,980,000 2,980,924
FHLMC Multiclass Mtg. Partn. Ctfs. Gtd.
Series 1933 Cl. AE
7.000% 03/15/2025................................................................... 5,156,300 5,198,820
FHLMC Multiclass Mtg. Partn. Ctfs. Gtd.
Series 1933 Cl. C
7.000% 03/15/2025................................................................... 3,316,818 3,346,782
FNMA Gtd. REMIC Pass Thru Ctf. REMIC Tr. 1991-94 Cl. C
0.000% 01/25/1999................................................................... 1,654,184 1,609,719
FNMA Gtd. REMIC Pass Thru Ctf. REMIC Tr. 1997-G1 Cl. B
7.500% 06/20/2024................................................................... 7,760,000 8,026,711
FNMA Gtd. REMIC Pass Thru Ctf. REMIC Tr. 1997-G4 Cl. C
7.500% 06/17/2024................................................................... 7,223,000 7,438,620
FNMA Gtd. REMIC Pass Thru Ctf. REMIC Tr. 1997-G5 Cl. VD
7.250% 04/17/2010................................................................... 3,600,000 3,737,611
FNMA Gtd. REMIC Pass Thru Ctf. REMIC Tr. 1997-24 Cl. YL
7.000% 04/18/2027................................................................... 3,166,000 3,199,890
FNMA Gtd. REMIC Pass Thru Ctf. REMIC Tr. 1997-38 Cl. G
7.500% 05/17/2026................................................................... 1,843,511 1,884,476
FNMA Gtd. REMIC Pass Thru Ctf. REMIC Tr. 1997-38 Cl. H
7.500% 05/17/2027................................................................... 1,766,000 1,842,838
FNMA Gtd. REMIC Pass Thru Ctf. REMIC Tr. 1997-38 Cl. L
7.500% 02/17/2012................................................................... 4,100,000 4,132,816
FNMA Gtd. REMIC Pass Thru Ctf. REMIC Tr. 1997-39 Cl. B
7.500% 05/17/2027................................................................... 2,673,000 2,801,594
FNMA Gtd. REMIC Pass Thru Ctf. REMIC Tr. 1997-43 Cl. B
7.500% 08/18/2025................................................................... 9,700,000 9,991,569
</TABLE>
49
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- ---------------- ----------------
-- COLUMBIA FIXED INCOME SECURITIES FUND, INC. --
-------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
</TABLE>
U.S. GOVERNMENT, FEDERAL AGENCY OBLIGATIONS (CONTINUED)
<TABLE>
<S> <C> <C>
FNMA Gtd. REMIC Pass Thru Ctf. REMIC Tr. 1997-44 Cl. PG
7.000% 02/18/2024................................................................... $ 3,920,000 $ 4,024,673
FNMA Gtd. REMIC Pass Thru Ctf. REMIC Tr. 1997-63 Cl. PH
7.000% 07/18/2026................................................................... 7,230,000 7,412,105
FNMA Gtd. REMIC Pass Thru Ctf. REMIC Tr. 1997-74 Cl. D
7.500% 09/20/2023................................................................... 10,600,000 10,890,222
GNMA Gtd. REMIC Pass Thru Secs. REMIC Tr. 1996-23 Cl. C
7.500% 12/20/2022................................................................... 3,607,000 3,721,955
GNMA Gtd. REMIC Pass Thru Secs. REMIC Tr. 1997-11 Cl. M
8.000% 05/16/2024................................................................... 1,190,000 1,248,105
GNMA Gtd. REMIC Pass Thru Secs. REMIC Tr. 1997-2 Cl. K
7.500% 01/20/2024................................................................... 2,410,000 2,489,819
GNMA Gtd. REMIC Pass Thru Secs. REMIC Tr. 1997-4 Cl. M
7.500% 02/16/2012................................................................... 4,357,000 4,468,626
GNMA Gtd. REMIC Pass Thru Secs. REMIC Tr. 1997-4 Cl. N
7.500% 02/16/2027................................................................... 4,165,468 4,313,842
GNMA Gtd. REMIC Pass Thru Secs. REMIC Tr. 1998-1 Cl. A
7.000% 01/15/2028................................................................... 1,890,000 1,878,773
Puerto Rico Housing Finance Corp.
Series A Cl. 4
9.000% 07/20/2017................................................................... 864,542 864,542
--------------
142,402,188
--------------
Total U.S. Government,
Federal Agency Obligations
(Cost $206,029,797) ................................................................. 212,675,460
--------------
OTHER SECURITIZED LOANS (13.2%)
COLLATERALIZED MORTGAGE OBLIGATIONS (10.2%)
BA Mortgage Securities, Inc.
Series 1997-2 Cl. 1A-3
7.400% 10/25/2027................................................................... 2,913,413 2,938,518
Bear Stearns Mortgage Securities, Inc.
Series 1996-2 Cl. A1
6.758% 01/25/2025................................................................... 4,298,842 4,283,979
GE Capital Mortgage Services, Inc.
Series 1997-8 Cl. A6
7.250% 10/25/2027................................................................... 2,480,000 2,539,056
<CAPTION>
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
<S> <C> <C>
GE Capital Mortgage Services, Inc.
Series 1997-8 Cl. A7
7.250% 10/25/2027................................................................... $ 6,232,714 $ 6,273,296
Mortgage Obligation Structured Trust (144A)
Series 1993-1 Cl. B1
10.668% 10/25/2018................................................................... 2,837,841 2,970,425
Norwest Asset Securities Corp.
Series 1997-16 Cl. A2
6.750% 10/25/2027................................................................... 13,470,000 13,369,234
PNC Mortgage Securities Corp.
Series 1997-4 Cl. 2PP2
7.500% 07/25/2027................................................................... 2,895,000 2,945,786
Residential Funding Morgage Securities, Inc.
Series 1993-S45 Cl. A-10
8.000% 12/25/2023................................................................... 1,250,000 1,286,756
Structured Asset Securities Corp.
Series 1997-4 Cl. 2A2
7.000% 12/25/2027................................................................... 2,500,000 2,525,440
--------------
39,132,490
--------------
ASSET BACKED SECURITIES (3.0%)
Empire Funding Home Loan Owner Trust
Series 1997-1 Cl. A-2
7.060% 03/25/2023................................................................... 2,890,000 2,903,901
Empire Funding Home Loan Owner Trust
Series 1997-2 Cl. A-1
8.850% 09/25/2023................................................................... 1,896,251 1,895,984
Saxon Asset Securities Co.
Series 1996-1 Cl. A2
8.060% 09/25/2027................................................................... 6,265,000 6,546,925
--------------
11,346,810
--------------
Total Other Securitized Loans
(Cost $49,626,860) .................................................................. 50,479,300
--------------
CORPORATE BONDS (25.9%)
INDUSTRIAL (11.0%)
Ethan Allen, Inc.
8.750% 03/15/2001................................................................... 1,975,000 2,019,437
Federal Express Corp. Pass Thru Trust
Series 1997-1C
7.650% 01/15/2014................................................................... 2,300,000 2,457,711
Foster Wheeler Corp.
6.750% 11/15/2005................................................................... 2,925,000 2,943,486
Georgia-Pacific Corp.
9.950% 06/15/2002................................................................... 3,250,000 3,678,187
Gulf Canada Resources Ltd.
9.625% 07/01/2005................................................................... 1,250,000 1,359,375
</TABLE>
50
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- ---------------- ----------------
-- COLUMBIA FIXED INCOME SECURITIES FUND, INC. --
-------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
</TABLE>
CORPORATE BONDS (CONTINUED)
<TABLE>
<S> <C> <C>
Heritage Media Corp.
8.750% 02/15/2006................................................................... $ 1,250,000 $ 1,329,687
Hilton Hotels Corp.
7.375% 06/01/2002................................................................... 4,000,000 4,106,880
Hollinger International Publishing, Inc.
8.625% 03/15/2005................................................................... 300,000 310,500
ICI Wilmington, Inc.
7.050% 09/15/2007................................................................... 3,805,000 3,949,476
Johns Manville International Grp.
10.875% 12/15/2004................................................................... 1,500,000 1,665,000
Lenfest Communications, Inc.
8.375% 11/01/2005................................................................... 1,350,000 1,387,125
Marriott International, Inc.
6.750% 12/01/2009................................................................... 2,750,000 2,807,613
Nabisco, Inc.
6.700% 06/15/2002................................................................... 3,750,000 3,798,150
Precision Castparts Corp.
6.750% 12/15/2007................................................................... 1,650,000 1,653,482
Sears, Roebuck Acceptance Corp.
6.400% 10/11/2000................................................................... 4,525,000 4,552,060
Tenet Healthcare Corp.
8.625% 12/01/2003................................................................... 750,000 781,875
Time Warner Entertainment Co. L.P.
8.375% 03/15/2023................................................................... 2,600,000 2,967,068
--------------
41,767,112
--------------
FINANCIAL (13.4%)
Aetna Services, Inc.
7.625% 08/15/2026................................................................... 5,000,000 5,261,850
American Health Properties, Inc.
7.500% 01/15/2007................................................................... 650,000 677,469
Bankamerica Corp.
5.938% 02/20/2002................................................................... 3,500,000 3,488,975
Deutsche Bank Financial, Inc.
7.500% 04/25/2009................................................................... 2,700,000 2,908,116
Equitable Cos., Inc.
9.000% 12/15/2004................................................................... 855,000 969,630
First Bank System, Inc.
6.188% 11/26/2010................................................................... 7,230,000 7,222,770
Ford Motor Credit Co.
6.500% 02/28/2002................................................................... 4,135,000 4,175,978
General Electric Capital Corp.
Medium Term Notes
6.350% 09/15/2001................................................................... 3,200,000 3,252,224
Goldman Sachs Group L.P. (144A)
Medium Term Notes
7.200% 03/01/2007................................................................... 3,700,000 3,839,046
<CAPTION>
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
<S> <C> <C>
Health Care Properties, Inc.
6.500% 02/15/2006................................................................... $ 6,400,000 $ 6,362,304
Liberty Property L.P.
7.100% 08/15/2004................................................................... 3,725,000 3,810,526
Merrill Lynch & Co., Inc.
Medium Term Notes
6.450% 06/20/2000................................................................... 3,650,000 3,680,441
Swiss Bank Corp. N.Y.
7.250% 09/01/2006................................................................... 1,825,000 1,923,714
USL Capital Corp.
6.500% 12/01/2003................................................................... 3,350,000 3,358,475
--------------
50,931,518
--------------
UTILITY (1.5%)
California Energy Co., Inc.
9.875% 06/30/2003................................................................... 1,000,000 1,084,570
Northern Indiana Public Service Co.
Medium Term Notes
6.900% 06/01/2000................................................................... 1,250,000 1,269,538
6.750% 06/01/2000................................................................... 2,500,000 2,530,800
Worldcom, Inc.
8.875% 01/15/2006................................................................... 900,000 968,328
--------------
5,853,236
--------------
Total Corporate Bonds
(Cost $96,450,075) .................................................................. 98,551,866
--------------
Total investments, excluding temporary cash investment
(Cost $352,106,732) ................................................................. 361,706,626
--------------
REPURCHASE AGREEMENT (4.4%)
Goldman Sachs Corp.
6.337% dated 12/31/1997,
due 01/02/1998 in the
amount of $16,762,082
Collateralized by U.S. Treasury Notes
5.875% due 08/31/1999
(Cost $16,756,264)................................................................... 16,756,264 16,756,264
--------------
TOTAL INVESTMENTS (99.3%)
(Cost $368,862,996)...................................................................... 378,462,890
RECEIVABLES LESS LIABILITIES (0.7%)....................................................... 2,869,864
--------------
NET ASSETS (100.0%)....................................................................... $ 381,332,754
--------------
--------------
</TABLE>
(1) See Note 1 of Notes to Financial Statements.
The accompanying notes are an integral part
of the financial statements.
51
<PAGE>
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[LOGO]
- --------------------- ---------------------
-- COLUMBIA MUNICIPAL BOND FUND, INC. --
----------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
December 31, 1997 AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
STATE OF OREGON GENERAL OBLIGATION BONDS (8.5%)
Board of Higher Education Series A
0.000% 08/01/2014................................................................... $ 450,000 $ 196,312
5.900% 08/01/2018................................................................... 1,000,000 1,072,500
Board of Higher Education Refunding
Series B
6.250% 10/15/2012................................................................... 740,000 799,200
Elderly & Disabled Housing Refunding
Series B
6.250% 08/01/2013................................................................... 1,000,000 1,090,000
Pollution Control Series C
5.625% 06/01/2013................................................................... 2,830,000 2,875,987
5.900% 06/01/2014................................................................... 3,670,000 3,747,987
Veterans' Welfare
11.000% 06/01/1999................................................................... 865,000 947,175
7.000% 07/01/2000................................................................... 1,350,000 1,449,563
9.000% 10/01/2000................................................................... 1,010,000 1,140,038
11.000% 12/01/2000................................................................... 865,000 1,029,350
0.000% 07/01/2001................................................................... 1,200,000 1,041,000
6.000% 08/01/2002................................................................... 2,000,000 2,157,500
6.000% 02/01/2004................................................................... 695,000 761,025
9.000% 04/01/2004................................................................... 280,000 352,100
9.000% 04/01/2005................................................................... 1,010,000 1,302,900
8.250% 07/01/2005................................................................... 500,000 625,625
9.000% 10/01/2005................................................................... 1,640,000 2,142,250
7.250% 01/01/2007................................................................... 1,485,000 1,798,706
9.200% 04/01/2007................................................................... 2,345,000 3,183,338
8.250% 07/01/2007................................................................... 540,000 697,950
9.200% 10/01/2007................................................................... 1,250,000 1,717,188
8.000% 01/01/2008................................................................... 1,220,000 1,557,025
7.300% 07/01/2008................................................................... 1,125,000 1,387,969
8.000% 07/01/2008................................................................... 480,000 617,400
5.850% 10/01/2015................................................................... 1,075,000 1,158,312
--------------
Total State of Oregon General Obligation Bonds
(Cost $32,697,391) .................................................................. 34,848,400
--------------
OREGON GENERAL OBLIGATION BONDS (19.6%)
Clackamas & Washington Counties School District #3JT
West Linn-Wilsonville
5.875% 10/01/2009................................................................... 2,550,000 2,750,812
Clackamas County School District #7J
Lake Oswego Series A
5.300% 06/15/2005................................................................... 1,000,000 1,061,250
5.500% 06/15/2006................................................................... 1,000,000 1,066,250
5.700% 06/15/2010................................................................... 2,735,000 2,888,844
Clackamas Community College District
5.250% 12/01/2009................................................................... 1,270,000 1,346,200
<CAPTION>
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
<S> <C> <C>
Deschutes County Administrative School District #1 Bend-Lapine
0.000% 02/01/2000................................................................... $ 1,175,000 $ 1,082,469
0.000% 02/01/2001................................................................... 1,135,000 1,003,056
0.000% 02/01/2002................................................................... 1,445,000 1,221,025
5.800% 02/01/2004................................................................... 780,000 828,750
5.900% 02/01/2005................................................................... 980,000 1,042,475
Eugene Public Safety
6.000% 06/01/2005................................................................... 850,000 939,250
Eugene Public Safety Facilities
5.625% 06/01/2013................................................................... 1,295,000 1,366,225
Jackson County School District #549C Medford
5.375% 06/01/2012................................................................... 1,200,000 1,233,000
Lane County Area Education District
Lane Community College
5.300% 06/01/2007................................................................... 1,000,000 1,063,750
4.850% 06/01/2008................................................................... 4,080,000 4,192,200
5.000% 06/01/2009................................................................... 1,000,000 1,042,500
Lane County School District #1
Pleasant Hill
5.350% 12/01/2012................................................................... 650,000 673,562
5.450% 12/01/2013................................................................... 725,000 754,000
Lane County School District #4J Eugene
0.000% 01/01/2003................................................................... 1,345,000 1,087,769
0.000% 01/01/2005................................................................... 1,395,000 1,027,069
Lane County School District #4J Eugene Refunding Series A
0.000% 07/01/2001................................................................... 2,015,000 1,745,494
0.000% 07/01/2003................................................................... 1,480,000 1,171,050
0.000% 07/01/2005................................................................... 2,325,000 1,674,000
5.250% 07/01/2008................................................................... 590,000 609,912
Lane County School District #19
Springfield Refunding
0.000% 02/01/1999................................................................... 470,000 450,697
Metro Open Spaces Program Series C
5.100% 09/01/2009................................................................... 2,375,000 2,443,281
Metro Washington Park Zoo Series A
5.250% 01/15/2009................................................................... 1,040,000 1,090,700
5.300% 01/15/2011................................................................... 1,000,000 1,040,000
Milwaukie, Or
4.650% 06/01/2009................................................................... 405,000 410,062
4.750% 06/01/2010................................................................... 425,000 430,844
4.850% 06/01/2011................................................................... 340,000 343,400
Multnomah-Clackamas Counties
School District No. 10JT Gresham
5.250% 06/01/2017................................................................... 1,620,000 1,634,175
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AMOUNT VALUE(1)
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<S> <C> <C>
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OREGON GENERAL OBLIGATION BONDS (CONTINUED)
<TABLE>
<S> <C> <C>
Multnomah-Clackamas Counties
School District #51JT Riverdale
5.750% 06/01/2016................................................................... $ 2,270,000 $ 2,394,850
Multnomah County Public Improvements
5.250% 10/01/2013................................................................... 1,800,000 1,842,750
Multnomah County School District #4 Gresham
6.100% 01/01/2008................................................................... 3,000,000 3,198,750
6.100% 01/01/2009................................................................... 200,000 212,500
Multnomah County School District #7 Reynolds
5.250% 06/01/2011................................................................... 1,500,000 1,545,000
Multnomah County School District #40
David Douglas
7.100% 06/01/2002................................................................... 880,000 985,600
Port of Portland Series A
0.000% 03/01/2007................................................................... 3,000,000 1,980,000
Portland Public Improvements Series A
5.750% 06/01/2014................................................................... 2,400,000 2,463,000
Portland Public Improvements Series B
4.625% 12/01/2010................................................................... 300,000 301,125
Portland Recreational Facilities Improvements
Series A
5.750% 06/01/2012................................................................... 1,370,000 1,462,475
5.750% 06/01/2013................................................................... 1,345,000 1,430,744
5.750% 06/01/2015................................................................... 1,155,000 1,225,744
Portland Recreational Facilities Improvements
Series B
5.500% 06/01/2009................................................................... 2,115,000 2,231,325
5.750% 06/01/2014................................................................... 1,750,000 1,861,563
5.750% 06/01/2015................................................................... 2,955,000 3,128,606
Portland Community College District
0.000% 07/01/2007................................................................... 2,025,000 1,326,375
Tri-County Metropolitan Transportation District Light Rail Extension Series A
6.000% 07/01/2012................................................................... 3,495,000 3,717,806
Tualatin Hills Park & Recreation District
5.700% 03/01/2009................................................................... 1,340,000 1,428,775
5.750% 03/01/2010................................................................... 730,000 775,625
Washington County Refunding
6.200% 12/01/2007................................................................... 1,500,000 1,605,000
Washington & Clackamas Counties
School District #23J
Tigard Refunding
5.400% 01/01/2010................................................................... 1,720,000 1,784,500
Washington County School District #48J Beaverton Series B
6.150% 06/01/2008................................................................... 1,010,000 1,057,975
<CAPTION>
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
<S> <C> <C>
Washington County School District #48J Beaverton Series C
7.800% 06/01/2003................................................................... $ 1,200,000 $ 1,404,000
--------------
Total Oregon General Obligation Bonds
(Cost $75,734,827) .................................................................. 80,078,159
--------------
OREGON REVENUE BONDS (14.7%)
Albany Hospital Facility Authority
Mennonite Home
5.625% 10/01/2017................................................................... 375,000 381,094
Clackamas County Hospital Facility Authority
Robison Jewish Home Project
6.250% 10/01/2021................................................................... 2,000,000 2,046,400
Clackamas County Hospital Facility Authority GNMA Collateral Jennings Lodge
7.500% 10/20/2031................................................................... 1,030,000 1,113,687
Clackamas County Housing Authority Multifamily Housing Easton Ridge Series A
5.800% 12/01/2016................................................................... 2,255,000 2,342,381
Deschutes County Hospital Facility Authority
5.750% 01/01/2009................................................................... 1,670,000 1,763,937
Deschutes Valley Water District
5.875% 09/01/2005................................................................... 3,420,000 3,685,050
Eugene Electric Utility Refunding
5.800% 08/01/2008................................................................... 1,435,000 1,508,544
5.800% 08/01/2009................................................................... 1,300,000 1,361,750
6.000% 08/01/2011................................................................... 1,375,000 1,450,625
Eugene Electric Utility
5.000% 08/01/2017................................................................... 1,480,000 1,467,050
Eugene Electric Utility Series C
5.750% 08/01/2011................................................................... 715,000 757,006
5.750% 08/01/2016................................................................... 1,055,000 1,105,113
Gresham Sewer
5.350% 06/01/2006................................................................... 860,000 909,450
Gresham Stormwater
6.100% 10/01/2009................................................................... 1,115,000 1,220,925
Hillsboro Hospital Facility Authority
Tuality Healthcare
5.750% 10/01/2012................................................................... 2,395,000 2,484,813
Lebanon Wastewater Refunding
5.750% 06/01/2011................................................................... 1,225,000 1,278,594
North Clackamas Parks & Recreation District Recreational Facilities
5.700% 04/01/2013................................................................... 2,840,000 2,953,600
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AMOUNT VALUE(1)
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<S> <C> <C>
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OREGON REVENUE BONDS (CONTINUED)
<TABLE>
<S> <C> <C>
Northern Wasco County People's Utility District Electric
0.000% 02/01/2006................................................................... $ 610,000 $ 408,700
0.000% 02/01/2007................................................................... 585,000 364,163
0.000% 02/01/2008................................................................... 610,000 352,275
0.000% 02/01/2011................................................................... 500,000 233,125
Oregon Health, Housing, Educational & Cultural Facilities
Authority Reed College Project Series A
5.300% 07/01/2011................................................................... 500,000 513,750
Oregon Housing Financial
5.800% 07/01/2009................................................................... 420,000 421,646
Oregon Housing & Community Services Department Housing Finance Assisted Insured
Multi-Unit B
6.800% 07/01/2013................................................................... 8,270,000 8,786,875
Oregon Housing & Community Services Department Mortgage Single-Family Mortgage Program
Series A
6.800% 07/01/2016................................................................... 2,125,000 2,279,063
Oregon Housing & Community Services Department Mortgage Single-Family Mortgage Program
Series D
6.700% 07/01/2013................................................................... 1,000,000 1,058,750
Oregon Housing & Community Services Department Mortgage Single-Family Mortgage Program
Series E
6.750% 07/01/2016................................................................... 2,705,000 2,863,919
Portland Hydroelectric Power
6.800% 10/01/2004................................................................... 465,000 469,338
Portland Parking Refunding
6.375% 10/01/2012................................................................... 1,700,000 1,782,875
Portland Water System
5.250% 08/01/2013................................................................... 2,000,000 2,042,500
5.000% 08/01/2017................................................................... 3,685,000 3,666,575
Prineville Sewer First Lien
6.500% 07/01/2004................................................................... 500,000 537,500
6.800% 07/01/2012................................................................... 1,050,000 1,168,125
Reedsport Water
7.000% 10/01/2014................................................................... 520,000 590,850
South Fork Water Board First Lien
5.450% 02/01/2014................................................................... 1,300,000 1,321,125
Tri-County Metropolitan Transportation District Refunding Series A
5.700% 08/01/2013................................................................... 3,000,000 3,097,500
<CAPTION>
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
<S> <C> <C>
Washington County
Unified Sewer Agency
Unrefunded Series A
6.200% 10/01/2010................................................................... $ 420,520 $ 462,046
--------------
Total Oregon Revenue Bonds
(Cost $56,794,517) .................................................................. 60,250,719
--------------
OREGON INSURED BONDS (35.4%)
Central Oregon Community College District
5.800% 06/01/2007................................................................... 760,000 818,900
Chemeketa Community College District
5.950% 06/01/2016................................................................... 1,600,000 1,742,000
Chemeketa Community College District
Series B
5.600% 06/01/2014................................................................... 1,105,000 1,182,350
Clackamas & Washington Counties School District #3JT
5.750% 06/01/2010................................................................... 590,000 649,737
Clackamas County Health Facility Authority Revenue Refunding Adventist Health A
6.350% 03/01/2009................................................................... 1,500,000 1,635,000
Clackamas County School District #115 Gladstone
6.150% 06/01/2014................................................................... 1,200,000 1,317,000
Clatsop County Administrative School District #10
5.875% 07/01/2012................................................................... 630,000 657,562
Crook County School District
4.900% 02/01/2009................................................................... 1,165,000 1,181,019
Deschutes & Jefferson Counties School District #2J Redmond Refunding
5.600% 06/01/2009................................................................... 1,000,000 1,051,250
Emerald Peoples Utilities District
7.200% 11/01/2006................................................................... 480,000 575,405
7.350% 11/01/2011................................................................... 2,000,000 2,527,500
Eugene Electric Utility Revenue Refunding
4.700% 08/01/2008................................................................... 1,225,000 1,251,031
Hood River County School District
5.650% 06/01/2008................................................................... 1,020,000 1,086,300
Josephine County School District #7
Grants Pass
5.700% 06/01/2013................................................................... 2,000,000 2,132,500
Klamath County
5.100% 06/01/2008................................................................... 1,015,000 1,083,512
5.150% 06/01/2009................................................................... 700,000 747,250
Lane County School District #19 Springfield
6.000% 10/15/2012................................................................... 740,000 838,050
6.000% 10/15/2014................................................................... 1,310,000 1,483,575
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AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
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OREGON INSURED BONDS (CONTINUED)
<TABLE>
<S> <C> <C>
Lane County School District #52 Bethel
6.250% 12/01/2007................................................................... $ 580,000 $ 665,550
6.400% 12/01/2009................................................................... 750,000 856,875
Lincoln County School District
6.000% 06/15/2006................................................................... 900,000 1,009,125
6.000% 06/15/2007................................................................... 1,855,000 2,091,512
6.000% 06/15/2008................................................................... 1,150,000 1,299,500
6.000% 06/15/2009................................................................... 2,465,000 2,785,450
5.600% 06/15/2010................................................................... 2,480,000 2,693,900
5.250% 06/15/2012................................................................... 3,815,000 3,972,369
Malheur County School District #26 Nyssa
5.750% 06/01/2015................................................................... 1,910,000 2,026,987
Marion & Linn County Elementary School District #77J Stayton
6.250% 07/01/2013................................................................... 1,260,000 1,404,900
Marion County School District #103C Woodburn Series B
0.000% 11/01/2006................................................................... 2,000,000 1,365,000
0.000% 11/01/2007................................................................... 2,000,000 1,300,000
0.000% 11/01/2009................................................................... 2,500,000 1,465,625
0.000% 11/01/2011................................................................... 2,010,000 1,037,662
Medford Hospital Facility Authority Revenue Gross-Rogue Valley Health Services
6.800% 12/01/2011................................................................... 1,820,000 1,983,800
Morrow County School District #1
6.000% 06/01/2006................................................................... 880,000 981,200
Multnomah County Educational Facilities University of Portland Project
5.000% 04/01/2018................................................................... 1,500,000 1,492,500
Multnomah County School District #3 Parkrose
5.400% 12/01/2005................................................................... 1,010,000 1,084,487
5.700% 12/01/2008................................................................... 1,330,000 1,436,400
5.700% 12/01/2009................................................................... 1,970,000 2,115,288
5.500% 12/01/2010................................................................... 895,000 947,581
5.500% 12/01/2011................................................................... 1,000,000 1,052,500
Northern Oregon Corrections
5.250% 09/15/2012................................................................... 1,000,000 1,037,500
5.300% 09/15/2013................................................................... 1,000,000 1,035,000
Ontario Oregon Catholic Health
Holy Rosary Medical Center
5.500% 11/15/2012................................................................... 1,500,000 1,573,125
Oregon Health Sciences University Revenue
Series A
0.000% 07/01/2009................................................................... 1,530,000 906,525
0.000% 07/01/2012................................................................... 1,315,000 642,706
0.000% 07/01/2014................................................................... 2,495,000 1,094,681
0.000% 07/01/2015................................................................... 4,325,000 1,789,469
<CAPTION>
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
<S> <C> <C>
Oregon Health Sciences University Revenue
Series B
4.875% 07/01/2007................................................................... $ 1,695,000 $ 1,767,038
Oregon Department of General Services Certificates Participation Series C
5.800% 03/01/2015................................................................... 840,000 875,700
Oregon Department of Administrative Services Certificates Participation Series A
5.375% 11/01/2004................................................................... 1,500,000 1,601,250
5.250% 05/01/2008................................................................... 4,950,000 5,240,813
5.300% 05/01/2008................................................................... 750,000 800,625
5.250% 11/01/2009................................................................... 2,460,000 2,579,925
5.700% 05/01/2015................................................................... 1,000,000 1,062,500
5.375% 11/01/2016................................................................... 4,360,000 4,474,450
Oregon Department of Administrative Services Certificates Participation Series B
5.500% 11/01/2011................................................................... 1,635,000 1,733,100
5.000% 11/01/2013................................................................... 1,000,000 1,000,000
5.000% 11/01/2014................................................................... 500,000 498,750
Oregon Department of Administrative Services Certificates Participation Series C
5.500% 05/01/2011................................................................... 2,000,000 2,115,000
5.750% 05/01/2017................................................................... 2,000,000 2,140,000
Oregon Health, Housing, Educational & Cultural Facilities Authority
Lewis & Clark College
6.000% 10/01/2013................................................................... 965,000 1,054,263
Port of Portland Airport Revenue Portland International Airport Series 7-A
6.500% 07/01/2004................................................................... 500,000 541,875
6.750% 07/01/2015................................................................... 2,895,000 3,155,550
Port of Portland Airport Revenue Series 9-A
5.500% 07/01/2006................................................................... 500,000 527,500
Portland Arena Gas Tax Revenue
0.000% 06/01/2016................................................................... 1,100,000 385,000
0.000% 06/01/2017................................................................... 1,420,000 465,050
Portland Community College District
5.000% 07/01/2011................................................................... 2,000,000 2,030,000
Portland Gas Tax Revenue Series A
5.800% 06/01/2016................................................................... 1,625,000 1,720,469
Portland Sewer System Revenue Series A
5.000% 06/01/2009................................................................... 1,000,000 1,036,250
5.000% 06/01/2015................................................................... 5,500,000 5,520,625
Salem-Keizer School District #24J
5.400% 06/01/2006................................................................... 1,000,000 1,063,750
Salem Pedestrian Safety Improvements
5.400% 05/01/2009................................................................... 1,000,000 1,057,500
Salem Water & Sewer
6.000% 06/01/2005................................................................... 1,080,000 1,200,150
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AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
</TABLE>
OREGON INSURED BONDS (CONTINUED)
<TABLE>
<S> <C> <C>
Tillamook County
6.250% 01/01/2014................................................................... $ 960,000 $ 1,064,400
5.700% 01/15/2016................................................................... 700,000 744,625
Umatilla County School District #6R Umatilla
5.080% 06/15/2018................................................................... 1,455,000 1,453,181
Umatilla County School District #8R Hermiston
6.000% 12/01/2010................................................................... 695,000 758,419
Union Health District
5.750% 02/01/2010................................................................... 1,070,000 1,112,800
Washington County School District #13
5.350% 06/01/2011................................................................... 355,000 371,863
5.350% 06/01/2012................................................................... 440,000 459,250
5.400% 06/01/2013................................................................... 485,000 506,219
Washington County School District #48J Beaverton Series A
5.200% 12/01/2009................................................................... 1,740,000 1,827,000
Washington County School District #88J Sherwood
6.100% 06/01/2012................................................................... 1,000,000 1,101,250
Washington County Unified Sewer Agency Revenue
5.500% 10/01/2016................................................................... 1,500,000 1,569,375
Washington County Unified Sewer Agency Revenue Series A
0.000% 10/01/2003................................................................... 1,975,000 1,550,375
0.000% 10/01/2005................................................................... 5,230,000 3,745,988
0.000% 10/01/2007................................................................... 4,835,000 3,148,794
5.750% 10/01/2009................................................................... 3,350,000 3,752,000
5.400% 10/01/2012................................................................... 520,000 546,650
Washington County Unified Sewer Agency Unrefunded Series A
5.900% 10/01/2006................................................................... 1,050,913 1,149,436
Western Lane Hospital District Facility Authority Revenue Refunding
Sisters St. Joseph Peace
5.625% 08/01/2007................................................................... 2,080,000 2,264,600
Yamhill County School District #29J Newberg
5.500% 06/01/2010................................................................... 1,405,000 1,477,006
6.100% 06/01/2011................................................................... 3,355,000 3,677,919
Yamhill County School District #40
6.000% 06/01/2009................................................................... 500,000 567,500
5.350% 06/01/2010................................................................... 500,000 529,375
5.600% 06/01/2016................................................................... 500,000 526,250
--------------
Total Oregon Insured Bonds
(Cost $136,123,662) ................................................................. 144,658,566
--------------
<CAPTION>
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
<S> <C> <C>
OREGON PRE-REFUNDED BONDS (9.1%)
Clackamas & Washington Counties School District #3JT West Linn-Wilsonville
5.875% 08/01/2009................................................................... $ 1,000,000 $ 1,066,250
Clackamas County Hospital Facility Authority Elderly Housing Willamette View Income
Project
7.000% 11/15/2011................................................................... 470,000 525,225
Clackamas County School District #1
6.250% 07/01/2002................................................................... 925,000 987,437
6.300% 07/01/2003................................................................... 700,000 748,125
6.500% 07/01/2004................................................................... 1,235,000 1,327,625
6.500% 07/01/2005................................................................... 1,355,000 1,456,625
6.500% 07/01/2006................................................................... 1,485,000 1,596,375
Lane County School District #19 Springfield
6.150% 10/15/2009................................................................... 1,500,000 1,672,500
Multnomah County Educational Facilities University Portland Project
6.000% 04/01/2014................................................................... 1,375,000 1,507,344
Oregon City Sewer
6.500% 10/01/2007................................................................... 500,000 561,250
Oregon Board of Higher Education Series A
6.350% 08/01/2014................................................................... 1,535,000 1,724,956
Oregon Housing, Educational & Cultural Facilities Authority Reed College Project
Series A
6.350% 07/01/2002................................................................... 320,000 348,000
6.400% 07/01/2003................................................................... 280,000 305,200
Portland Airport Way Urban Renewal & Redevelopment Tax Increment Series A
7.300% 06/01/2010................................................................... 1,400,000 1,505,000
Portland Community College District Series A
6.000% 07/01/2012................................................................... 1,500,000 1,606,875
Portland Sewer System Revenue Series A
6.050% 06/01/2009................................................................... 535,000 589,169
6.200% 06/01/2012................................................................... 5,540,000 6,149,400
6.250% 06/01/2015................................................................... 2,000,000 2,225,000
Washington County Unified Sewer Agency Series A
5.900% 10/01/2006................................................................... 2,679,087 2,926,903
Washington County Unified Sewer Agency Revenue Series A
6.125% 10/01/2012................................................................... 4,510,000 4,989,187
Washington County Unified Sewer Agency Series A
6.200% 10/01/2010................................................................... 3,064,480 3,393,912
--------------
Total Oregon Pre-Refunded Bonds
(Cost $34,060,410) .................................................................. 37,212,358
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AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
<S> <C> <C>
OREGON OTHER BONDS (2.6%)
Grants Pass Urban Renewal Agency Tax Increment
6.125% 08/01/2012................................................................... $ 755,000 $ 781,425
Hood River Urban Renewal Agency Revenue
6.250% 12/15/2011................................................................... 1,250,000 1,360,937
Lane County School District #4J Eugene Certificates Participation
6.900% 10/01/2000................................................................... 500,000 536,250
Lebanon Special Obligation Revenue Refunding Lease Water
5.400% 10/01/2013................................................................... 755,000 770,100
Medford Urban Renewal Agency Tax Revenue
5.875% 09/01/2010................................................................... 500,000 527,500
Newberg Certificates Participation
5.900% 12/01/1998................................................................... 365,000 370,876
6.000% 12/01/1999................................................................... 390,000 403,163
6.100% 12/01/2000................................................................... 410,000 430,500
6.200% 12/01/2001................................................................... 410,000 436,650
Portland Building Refunding Series A
4.750% 04/01/2007................................................................... 2,000,000 2,030,000
Portland Airport Way Urban Renewal & Redevelopment Tax Increment Series C
5.900% 06/01/2006................................................................... 860,000 921,275
Portland Urban Renewal & Redevelopment Refunding, Downtown Waterfront Series L
6.400% 06/01/2008................................................................... 2,085,000 2,257,013
--------------
Oregon Other Bonds (2.6%)
(Cost $10,109,353) .................................................................. 10,825,689
--------------
OTHER BONDS (7.2%)
Puerto Rico Commonwealth
6.250% 07/01/2008................................................................... 1,000,000 1,155,000
Puerto Rico Commonwealth Public Improvements
6.250% 07/01/2009................................................................... 3,000,000 3,453,750
6.250% 07/01/2013................................................................... 1,000,000 1,170,000
Puerto Rico Commonwealth Aqueduct & Sewer Authority
5.200% 07/01/2008................................................................... 1,000,000 1,066,250
Puerto Rico Commonwealth Aqueduct & Sewer Authority Revenue Series A
9.000% 07/01/2009................................................................... 5,830,000 7,447,825
Puerto Rico Commonwealth Infrastructure Financing Authority
5.000% 07/01/2013................................................................... 1,750,000 1,760,937
Puerto Rico Commonwealth Public Buildings Authority
5.000% 07/01/2013................................................................... 3,130,000 3,157,387
<CAPTION>
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
<S> <C> <C>
Puerto Rico Electric Power Authority
5.000% 07/01/2010................................................................... $ 2,425,000 $ 2,494,719
Puerto Rico Housing Finance Corp. Single Family Mortgage Revenue Portfolio 1 Series B
7.500% 10/15/2012................................................................... 1,040,000 1,098,500
Puerto Rico Housing Finance Corp. Single Family Mortgage Revenue Portfolio 1 Series C
6.750% 10/15/2013................................................................... 710,000 757,925
Puerto Rico Housing Finance Corp. Multi Family Mortgage Revenue Portfolio A-1
7.500% 04/01/2022................................................................... 1,680,000 1,772,400
Puerto Rico Industrial, Medical & Environmental Pollution Control Facilities Financing
Authority Revenue FHA Insured Mortgage Dr. Pila Hospital Project-A
7.700% 08/01/2008................................................................... 1,975,000 2,051,294
Puerto Rico Housing Bank & Finance Agency Single Family Mortgage Revenue FHA
Homeownership 5th Portfolio
7.500% 12/01/2015................................................................... 610,000 658,038
Virgin Islands Public Finance Authority Revenue Unrefunded Balance Series A
7.300% 10/01/2018................................................................... 1,185,000 1,531,613
--------------
Total Other Bonds
(Cost $27,865,999) .................................................................. 29,575,638
--------------
Total investments, excluding temporary cash investment
(Cost $373,386,159) ................................................................. 397,449,529
--------------
TAX-EXEMPT MONEY MARKET INVESTMENT (2.3%)
SEI Tax Exempt Trust
(Cost $9,250,961) ................................................................... 9,250,961 9,250,961
--------------
TOTAL INVESTMENTS (99.4%)
(Cost $382,637,120)...................................................................... 406,700,490
RECEIVABLE LESS LIABILITIES (0.6%)........................................................ 2,447,685
--------------
NET ASSETS (100.0%)....................................................................... $ 409,148,175
--------------
--------------
</TABLE>
(1) See Note 1 of Notes to Financial Statements.
The accompanying notes are an integral part
of the financial statements.
57
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[LOGO]
- ------------------------ ------------------------
-- COLUMBIA HIGH YIELD FUND, INC. --
------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
December 31, 1997 AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
CORPORATE BONDS (89.5%)
INDUSTRIAL (3.9%)
BUSINESS SERVICES (3.9%)
Iron Mountain, Inc.
Senior Subordinated Notes
10.125% 10/01/2006................................................................. $ 750,000 $ 825,000
Pierce Leahy Corp.
Senior Subordinated Notes
11.125% 07/15/2006................................................................. 625,000 706,250
--------------
Total Industrial ..................................................................... 1,531,250
--------------
BASIC INDUSTRY (4.0%)
CHEMICALS (2.0%)
ICO, Inc.
Series B Senior Notes
10.375% 06/01/2007................................................................. 750,000 804,375
METALS/MINING (2.0%)
Ryerson Tull, Inc.
Notes
8.500% 07/15/2001................................................................. 750,000 776,250
--------------
Total Basic Industry ................................................................. 1,580,625
--------------
CONSUMER RELATED (17.5%)
HOTEL/GAMING (4.8%)
HMH Properties, Inc.
Series B Senior Secured Notes
9.500% 05/15/2005................................................................. 600,000 639,000
Rio Hotel & Casino, Inc.
Senior Subordinated Notes
9.500% 04/15/2007................................................................. 450,000 477,000
Station Casinos, Inc.
Senior Subordinated Notes
9.625% 06/01/2003................................................................. 740,000 764,050
--------------
1,880,050
--------------
HEALTHCARE (7.0%)
Abbey Healthcare Group, Inc.
Senior Subordinated Notes
9.500% 11/01/2002................................................................. 850,000 892,500
Healthsouth Corp.
Senior Subordinated Notes
9.500% 04/01/2001................................................................. 300,000 315,975
Quorum Health Group, Inc.
Senior Subordinated Notes
8.750% 11/01/2005................................................................. 750,000 774,375
<CAPTION>
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
<S> <C> <C>
Tenet Healthcare Corp.
Senior Subordinated Notes
10.125% 03/01/2005................................................................. $ 700,000 $ 764,750
--------------
2,747,600
--------------
OTHER (5.7%)
Maxim Group, Inc. (144A)
Senior Subordinated Notes
9.250% 10/15/2007................................................................. 900,000 891,000
Westpoint Stevens, Inc.
Senior Subordinated Debentures
9.375% 12/15/2005................................................................. 800,000 840,000
Worldtex, Inc. (144A)
Senior Notes
9.625% 12/15/2007................................................................. 500,000 512,500
--------------
2,243,500
--------------
Total Consumer Related ............................................................... 6,871,150
--------------
ENERGY (7.2%)
Gulf Canada Resources Ltd.
Subordinated Debentures
9.625% 07/01/2005................................................................. 750,000 815,625
Kelley Oil & Gas Corp.
Series B Senior Subordinated Notes
10.375% 10/15/2006................................................................. 600,000 640,500
Nuevo Energy Co.
Senior Subordinated Notes
9.500% 04/15/2006................................................................. 900,000 951,750
Santa Fe Energy Resource, Inc.
Senior Subordinated Debentures
11.000% 05/15/2004................................................................. 400,000 434,000
--------------
Total Energy ......................................................................... 2,841,875
--------------
HOUSING RELATED (3.4%)
USG Corp.
Series B Senior Notes
9.250% 09/15/2001................................................................. 500,000 535,000
Webb (Del E.) Corp.
Senior Subordinated Notes
9.750% 01/15/2008................................................................. 750,000 780,000
--------------
Total Housing Related ................................................................ 1,315,000
--------------
MANUFACTURING (9.5%)
Hayes Wheels International, Inc.
Series B Senior Subordinated Notes
9.125% 07/15/2007................................................................. 800,000 828,000
Polymer Group, Inc.
Series B Senior Subordinated Notes
9.000% 07/01/2007................................................................. 500,000 500,000
</TABLE>
58
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- ------------------------ ------------------------
-- COLUMBIA HIGH YIELD FUND, INC. --
------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
</TABLE>
CORPORATE BONDS (CONTINUED)
<TABLE>
<S> <C> <C>
Silgan Holdings, Inc.
Senior Subordinated Debentures
9.000% 06/01/2009................................................................. $ 750,000 $ 766,875
Titan Wheel International, Inc.
Senior Subordinated Notes
8.750% 04/01/2007................................................................. 800,000 836,000
Tracor, Inc.
Senior Subordinated Notes
8.500% 03/01/2007................................................................. 800,000 808,000
--------------
Total Manufacturing .................................................................. 3,738,875
--------------
MEDIA (21.7%)
Cinemark USA, Inc.
Series B Senior Subordinated Notes
9.625% 08/01/2008................................................................. 750,000 774,375
Heritage Media Corp.
Senior Subordinated Notes
8.750% 02/15/2006................................................................. 750,000 797,812
Hollinger International Publishing, Inc.
Senior Notes
8.625% 03/15/2005................................................................. 800,000 828,000
Jacor Communications Co. (144A)
Senior Subordinated Notes
8.750% 06/15/2007................................................................. 750,000 768,750
Jones Intercable, Inc.
Senior Notes
8.875% 04/01/2007................................................................. 700,000 731,500
Lamar Advertising Co.
Senior Subordinated Notes
9.625% 12/01/2006................................................................. 900,000 969,750
Lenfest Communications, Inc.
Senior Secured Notes
8.375% 11/01/2005................................................................. 750,000 770,625
Regal Cinemas, Inc. (144A)
Senior Subordinated Notes
8.500% 10/01/2007................................................................. 750,000 755,625
SFX Broadcasting, Inc.
Series B Senior Subordinated Notes
10.750% 05/15/2006................................................................. 750,000 823,125
Sinclair Broadcast Group, Inc.
Senior Subordinated Notes
8.750% 12/15/2007................................................................. 750,000 748,125
Young Broadcasting, Inc.
Gtd. Senior Subordinated Notes
11.750% 11/15/2004................................................................. 500,000 556,250
--------------
Total Media .......................................................................... 8,523,937
--------------
<CAPTION>
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
<S> <C> <C>
RETAIL (5.8%)
OTHER (5.8%)
Ethan Allen, Inc.
Senior Notes
8.750% 03/15/2001................................................................. $ 750,000 $ 766,875
Specialty Retailers, Inc.
Series B Senior Notes
8.500% 07/15/2005................................................................. 750,000 761,250
Zale Corp. (144A)
Senior Notes
8.500% 10/01/2007................................................................. 750,000 746,250
--------------
Total Retail ......................................................................... 2,274,375
--------------
TRANSPORTATION (3.5%)
OTHER (3.5%)
Allied Holdings, Inc.
Series B Senior Notes
8.625% 10/01/2007................................................................. 500,000 507,500
Teekay Shipping Corp.
Gtd. 1st Pfd. Ship. Mtg. Notes
8.320% 02/01/2008................................................................. 850,000 867,000
--------------
Total Transportation ................................................................. 1,374,500
--------------
UTILITY (8.7%)
ELECTRICS (4.5%)
AES Corp.
Senior Subordinated Notes
10.250% 07/15/2006................................................................. 800,000 864,000
California Energy Co., Inc.
Senior Secured Notes
9.875% 06/30/2003................................................................. 850,000 921,885
--------------
1,785,885
--------------
TELECOMMUNICATIONS (4.2%)
Paging Network, Inc.
Senior Subordinated Notes
10.000% 10/15/2008................................................................. 750,000 780,000
Worldcom, Inc.
Senior Notes
8.875% 01/15/2006................................................................. 799,910 860,639
--------------
1,640,639
--------------
Total Utilities ...................................................................... 3,426,524
--------------
YANKEE (4.3%)
Argentina Republic
Unsubordinated Global Bonds
11.000% 10/09/2006................................................................. 750,000 807,150
</TABLE>
59
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[LOGO]
- ------------------------ ------------------------
-- COLUMBIA HIGH YIELD FUND, INC. --
------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE(1)
------------- --------------
<S> <C> <C>
</TABLE>
CORPORATE BONDS (CONTINUED)
<TABLE>
<S> <C> <C>
Mexico-United Mexican States
Global Bonds
11.375% 09/15/2016................................................................. $ 750,000 $ 862,500
--------------
Total Yankee ......................................................................... 1,669,650
--------------
Total Corporate Bonds
(Cost $34,017,097) .................................................................. 35,147,761
--------------
REPURCHASE AGREEMENTS (8.9%)
Goldman Sachs Corp.
6.337% dated 12/31/1997,
due 01/02/1998 in the
amount of $2,760,481.
Collateralized by U.S. Treasury Notes
5.875% due 08/31/1999................................................................ 2,759,523 2,759,523
J.P. Morgan Securities, Inc.
6.521% dated 12/31/1997,
due 01/02/1998 in the
amount of $750,268.
Collateralized by U.S. Treasury Notes
3.625% to 7.500%
due 08/31/2000 to 02/15/2005......................................................... 750,000 750,000
--------------
Total Repurchase Agreements
(Cost $3,509,523) ................................................................... 3,509,523
--------------
TOTAL INVESTMENTS (98.4%)
(Cost $37,526,620)....................................................................... 38,657,284
RECEIVABLES LESS LIABILITIES (1.6%)....................................................... 621,125
--------------
NET ASSETS (100.0%)....................................................................... $ 39,278,409
--------------
--------------
</TABLE>
(1) See Note 1 of Notes to Financial Statements.
The accompanying notes are an integral part
of the financial statements.
60
<PAGE>
STATEMENTS OF ASSETS AND LIABILITIES
-----------------------------------------------------------------
<TABLE>
<CAPTION>
COLUMBIA COLUMBIA COLUMBIA COLUMBIA
COMMON STOCK GROWTH INTERNATIONAL STOCK SPECIAL
December 31, 1997 FUND, INC. FUND, INC. FUND, INC. FUND, INC.
------------- --------------- ------------------- ---------------
<S> <C> <C> <C> <C>
ASSETS:
Investments at identified cost............. $591,083,706 $ 998,562,165 $115,352,903 $ 1,080,385,133
- --------------------------------------------- ------------- --------------- ------------------- ---------------
Investments at value (Notes 1 and 2)....... $728,952,817 $ 1,301,830,187 $130,260,028 $ 1,218,584,838
Temporary cash investments, at cost (Note
1)........................................ 94,603,062 27,749,208 17,066,118 92,623,788
Cash....................................... 49,992
Cash denominated in foreign currencies
(cost $30,118) (Note 1)................... 28,481
Receivable for:
Interest................................. 380,104 95,041 71,382 539,653
Dividends................................ 991,982 1,157,953 148,571 812,476
Investments sold......................... 179,769 4,642,953 140,743
Capital stock sold....................... 12,830,283 1,098,716 109,439 1,600,359
Forward foreign currency exchange
contract held, at market (Note 1)....... 26,154,849
------------- --------------- ------------------- ---------------
Total assets............................... 837,938,017 1,336,574,058 173,888,860 1,314,301,857
------------- --------------- ------------------- ---------------
LIABILITIES:
Payable for:
Capital stock redeemed................... 21,686,397 1,612,360 345,451 54,827,406
Dividends and distributions.............. 2,537,818 9,010,622 985,568 5,565,501
Investments purchased.................... 29,137,562 2,906,000
Investment management fee (Note 4)....... 399,727 638,746 125,499 954,989
Accrued expenses......................... 270,694 394,641 126,631 330,164
Forward foreign currency exchange
contracts held (Note 1)................. 26,025,176
------------- --------------- ------------------- ---------------
Total liabilities.......................... 54,032,198 11,656,369 27,608,325 64,584,060
------------- --------------- ------------------- ---------------
NET ASSETS APPLICABLE TO OUTSTANDING
SHARES...................................... $783,905,819 $ 1,324,917,689 $146,280,535 $ 1,249,717,797
------------- --------------- ------------------- ---------------
------------- --------------- ------------------- ---------------
Net assets consist of:
Undistributed net investment income........ $ 1,537,363 $ 1,999,579 $ 360,073
Unrealized appreciation on:
Investments.............................. 137,869,111 303,268,022 $ 14,907,125 138,199,705
Translation of assets and liabilities in
foreign currencies...................... 124,446
Undistributed net realized gain (loss)
from:
Investments.............................. 798,088 1,714,128 (30,287) (812,034)
Foreign currency transactions............ (129,673)
Capital shares (Note 3).................... 385,808 616,718
Capital paid in (Note 3)................... 643,701,257 1,017,550,152 131,408,924 1,111,353,335
------------- --------------- ------------------- ---------------
$783,905,819 $ 1,324,917,689 $146,280,535 $ 1,249,717,797
------------- --------------- ------------------- ---------------
------------- --------------- ------------------- ---------------
SHARES OF CAPITAL STOCK OUTSTANDING (NOTE
3).......................................... 35,603,323 38,580,838 10,674,460 61,671,768
------------- --------------- ------------------- ---------------
------------- --------------- ------------------- ---------------
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE (1)......................... $ 22.02 $ 34.34 $ 13.70 $ 20.26
------------- --------------- ------------------- ---------------
------------- --------------- ------------------- ---------------
</TABLE>
(1) The net asset value per share is computed by dividing net assets applicable
to outstanding shares by shares of capital stock outstanding.
The accompanying notes are an integral part of the financial statements.
61
<PAGE>
STATEMENTS OF ASSETS AND LIABILITIES
-----------------------------------------------------------------
<TABLE>
<CAPTION>
COLUMBIA COLUMBIA REAL COLUMBIA COLUMBIA
SMALL CAP ESTATE EQUITY BALANCED DAILY INCOME
December 31, 1997 FUND, INC. FUND, INC. FUND, INC. COMPANY
------------ ------------- ------------- ---------------
<S> <C> <C> <C> <C>
ASSETS:
Investments at identified cost............. $ 83,953,702 $113,044,943 $ 687,367,178 $ 1,173,657,688
- --------------------------------------------- ------------ ------------- ------------- ---------------
Investments at value (Notes 1 and 2)....... $ 93,338,061 $140,161,757 $ 781,687,536 $ 1,173,657,688
Temporary cash investments, at cost (Note
1)........................................ 3,622,273 11,040,866 18,639,214
Cash....................................... 300,000
Receivable for:
Interest................................. 34,328 33,119 4,943,205 370,359
Dividends................................ 5,387 735,392 473,178
Investments sold......................... 1,824,671 8,078,540
Capital stock sold....................... 570,168 1,532,140 7,114,096 12,123,502
------------ ------------- ------------- ---------------
Total assets............................... 97,570,217 155,327,945 820,935,769 1,186,451,549
------------ ------------- ------------- ---------------
LIABILITIES:
Payable for:
Capital stock redeemed................... 231,990 931,665 1,852,679 16,588,968
Dividends and distributions.............. 442,455 663,247 361,650
Investments purchased.................... 321,655 2,016,928 25,767,691
Investment management fee (Note 4)....... 80,499 91,680 333,276 445,481
Accrued expenses......................... 62,309 69,985 242,217 321,532
------------ ------------- ------------- ---------------
Total liabilities.......................... 1,138,908 3,773,505 28,557,513 17,355,981
------------ ------------- ------------- ---------------
NET ASSETS APPLICABLE TO OUTSTANDING
SHARES...................................... $ 96,431,309 $151,554,440 $ 792,378,256 $ 1,169,095,568
------------ ------------- ------------- ---------------
------------ ------------- ------------- ---------------
Net assets consist of:
Undistributed net investment income........ $ 758,037
Unrealized appreciation on investments..... $ 9,384,359 $ 27,116,814 94,320,358
Undistributed net realized gain (loss) from
investments............................... (47,218) (1,863) 902,790
Capital shares (Note 3).................... $ 1,169,096
Capital paid in (Note 3)................... 87,094,168 124,439,489 696,397,071 1,167,926,472
------------ ------------- ------------- ---------------
$ 96,431,309 $151,554,440 $ 792,378,256 $ 1,169,095,568
------------ ------------- ------------- ---------------
------------ ------------- ------------- ---------------
SHARES OF CAPITAL STOCK OUTSTANDING (NOTE
3).......................................... 5,792,970 8,062,906 36,999,621 1,169,095,568
------------ ------------- ------------- ---------------
------------ ------------- ------------- ---------------
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE (1)......................... $ 16.65 $ 18.80 $ 21.42 $ 1.00
------------ ------------- ------------- ---------------
------------ ------------- ------------- ---------------
</TABLE>
(1) The net asset value per share is computed by dividing net assets applicable
to outstanding shares by shares of capital stock outstanding.
The accompanying notes are an integral part of the financial statements.
62
<PAGE>
STATEMENTS OF ASSETS AND LIABILITIES
-----------------------------------------------------------------
<TABLE>
<CAPTION>
COLUMBIA U.S. COLUMBIA FIXED COLUMBIA COLUMBIA
GOVERNMENT SECURITIES INCOME SECURITIES MUNICIPAL BOND HIGH YIELD
December 31, 1997 FUND, INC. FUND, INC. FUND, INC. FUND, INC.
--------------------- ----------------- -------------- ------------
<S> <C> <C> <C> <C>
ASSETS:
Investments at identified cost............. $37,019,300 $352,106,732 $373,386,159 $ 34,017,097
- --------------------------------------------- --------------------- ----------------- -------------- ------------
Investments at value (Notes 1 and 2)....... $37,110,250 $361,706,626 $397,449,529 $ 35,147,761
Temporary cash investments, at cost (Note
1)........................................ 489,660 16,756,264 9,250,961 3,509,523
Receivable for:
Interest................................. 594,173 4,146,142 5,150,997 845,880
Investments sold......................... 1,734,615
Capital stock sold....................... 2,744 587,519 711,513 52,553
--------------------- ----------------- -------------- ------------
Total assets............................... 38,196,827 384,931,166 412,563,000 39,555,717
--------------------- ----------------- -------------- ------------
LIABILITIES:
Payable for:
Capital stock redeemed................... 296,055 258,822 194,689 25,561
Dividends and distributions.............. 13,147 678,152 942,554 203,813
Investments purchased.................... 2,065,838 2,037,575
Investment management fee (Note 4)....... 16,372 161,421 172,765 3,517
Accrued expenses......................... 34,578 434,179 67,242 44,417
--------------------- ----------------- -------------- ------------
Total liabilities.......................... 360,152 3,598,412 3,414,825 277,308
--------------------- ----------------- -------------- ------------
NET ASSETS APPLICABLE TO OUTSTANDING
SHARES...................................... $37,836,675 $381,332,754 $409,148,175 $ 39,278,409
--------------------- ----------------- -------------- ------------
--------------------- ----------------- -------------- ------------
Net assets consist of:
Unrealized appreciation on investments..... $ 90,950 $ 9,599,894 $ 24,063,370 $ 1,130,664
Undistributed net realized gain (loss) from
investments............................... (249,278) 8,080 301,769 30,713
Capital shares (Note 3).................... 45,619 284,274 328,202
Capital paid in (Note 3)................... 37,949,384 371,440,506 384,454,834 38,117,032
--------------------- ----------------- -------------- ------------
$37,836,675 $381,332,754 $409,148,175 $ 39,278,409
--------------------- ----------------- -------------- ------------
--------------------- ----------------- -------------- ------------
SHARES OF CAPITAL STOCK OUTSTANDING (NOTE
3).......................................... 4,561,855 28,427,440 32,820,166 3,913,232
--------------------- ----------------- -------------- ------------
--------------------- ----------------- -------------- ------------
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE (1)......................... $ 8.29 $ 13.41 $ 12.47 $ 10.04
--------------------- ----------------- -------------- ------------
--------------------- ----------------- -------------- ------------
</TABLE>
(1) The net asset value per share is computed by dividing net assets applicable
to outstanding shares by shares of capital stock outstanding.
The accompanying notes are an integral part of the financial statements.
63
<PAGE>
STATEMENTS OF OPERATIONS
-----------------------------------------------------------------
<TABLE>
<CAPTION>
COLUMBIA COLUMBIA COLUMBIA COLUMBIA
COMMON STOCK GROWTH INTERNATIONAL STOCK SPECIAL
Year Ended December 31, 1997 FUND, INC. FUND, INC. FUND, INC. FUND, INC.
------------- ------------- ------------------- -------------
<S> <C> <C> <C> <C>
INVESTMENT INCOME:
Income:
Interest................................. $ 3,048,343 $ 1,820,088 $ 633,045 $ 5,470,977
Dividends................................ 11,603,708 13,482,283 2,328,263 9,434,285
Foreign taxes withheld (net of
reclaims)............................... (276,894)
------------- ------------- ------------------- -------------
Total income........................... 14,652,051 15,302,371 2,684,414 14,905,262
------------- ------------- ------------------- -------------
Expenses:
Investment management fees (Note 4)...... 4,158,273 7,019,161 1,504,787 12,373,140
Shareholder servicing costs (Note 4)..... 802,650 1,036,576 401,177 1,402,637
Reports to shareholders.................. 121,540 273,690 89,060 297,099
Accounting expense....................... 35,794 38,348 89,372 45,504
Financial information and
subscriptions........................... 9,802 18,422 19,979 26,041
Custodian fees........................... 27,901 49,225 147,332 58,659
Bank transaction and checking fees....... 20,985 33,934 47,326 50,531
Registration fees........................ 80,003 84,219 38,396 55,075
Legal, insurance and auditing fees....... 36,992 47,281 34,161 54,489
Other.................................... 3,228 8,839 35,838 10,314
------------- ------------- ------------------- -------------
Total expenses......................... 5,297,168 8,609,695 2,407,428 14,373,489
------------- ------------- ------------------- -------------
Net investment income (Note 1)............. 9,354,883 6,692,676 276,986 531,773
------------- ------------- ------------------- -------------
REALIZED GAIN (LOSS) AND UNREALIZED
APPRECIATION (DEPRECIATION) FROM INVESTMENT
AND FOREIGN CURRENCY TRANSACTIONS:
Net realized gain (loss) from:
Investments (Note 2)(1).................. 61,630,849 150,238,079 17,347,526 122,678,842
Foreign currency transactions (Note 1)... (286,335)
------------- ------------- ------------------- -------------
Net realized gain...................... 61,630,849 150,238,079 17,061,191 122,678,842
------------- ------------- ------------------- -------------
Net unrealized appreciation (depreciation)
on:
Investments (Note 1)..................... 76,981,002 122,000,869 (1,735,993) 49,916,627
Translation of assets and liabilities in
foreign currencies (Note 1)............. (67,221)
------------- ------------- ------------------- -------------
Net unrealized appreciation
(depreciation) during the period...... 76,981,002 122,000,869 (1,803,214) 49,916,627
------------- ------------- ------------------- -------------
Net gain on investment and foreign currency
transactions (Note 1)..................... 138,611,851 272,238,948 15,257,977 172,595,469
------------- ------------- ------------------- -------------
Net increase in net assets resulting from
operations................................ $147,966,734 $ 278,931,624 $15,534,963 $ 173,127,242
------------- ------------- ------------------- -------------
------------- ------------- ------------------- -------------
</TABLE>
(1) The net realized gain for CSF includes $7,023,101 loss from affiliated
issuers. (Note 1)
The accompanying notes are an integral part of the financial statements.
64
<PAGE>
STATEMENTS OF OPERATIONS
-----------------------------------------------------------------
<TABLE>
<CAPTION>
COLUMBIA COLUMBIA COLUMBIA COLUMBIA
SMALL CAP REAL ESTATE EQUITY BALANCED DAILY INCOME
Year Ended December 31, 1997 FUND, INC. FUND, INC. FUND, INC. COMPANY
-------------- ------------------ ------------- ------------
<S> <C> <C> <C> <C>
INVESTMENT INCOME:
Income:
Interest................................. $ 267,417 $ 522,739 $ 27,456,656 $50,578,946
Dividends................................ 87,990 6,230,108 6,696,506
-------------- ------------------ ------------- ------------
Total income........................... 355,407 6,752,847 34,153,162 50,578,946
-------------- ------------------ ------------- ------------
Expenses:
Investment management fees (Note 4)...... 547,892 864,343 3,826,628 4,296,685
Shareholder servicing costs (Note 4)..... 84,315 147,702 908,682 785,663
Reports to shareholders.................. 22,892 36,581 158,095 194,528
Accounting expense....................... 30,148 28,628 43,071 44,583
Financial information and
subscriptions........................... 981 2,444 22,155 13,392
Custodian fees........................... 2,305 4,733 30,526 35,947
Bank transaction and checking fees....... 19,580 10,591 32,640 100,680
Registration fees........................ 48,501 57,476 53,865 138,174
Legal, insurance and auditing fees....... 19,033 20,368 40,600 41,730
Other.................................... 23,345 1,603 14,547 12,298
-------------- ------------------ ------------- ------------
Total expenses......................... 798,992 1,174,469 5,130,809 5,663,680
-------------- ------------------ ------------- ------------
Net investment income (loss) (Note 1)...... (443,585) 5,578,378 29,022,353 44,915,266
-------------- ------------------ ------------- ------------
REALIZED GAIN AND UNREALIZED APPRECIATION
FROM INVESTMENT TRANSACTIONS:
Net realized gain from investments (Note
2)........................................ 4,931,098 3,597,873 62,144,958
Net unrealized appreciation on investments
during the period (Note 1)................ 7,895,606 16,211,982 38,270,990
-------------- ------------------ -------------
Net gain on investments (Note 1)........... 12,826,704 19,809,855 100,415,948
-------------- ------------------ ------------- ------------
Net increase in net assets resulting from
operations................................ $12,383,119 $25,388,233 $ 129,438,301 $44,915,266
-------------- ------------------ ------------- ------------
-------------- ------------------ ------------- ------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
65
<PAGE>
STATEMENTS OF OPERATIONS
-----------------------------------------------------------------
<TABLE>
<CAPTION>
COLUMBIA U.S. COLUMBIA FIXED COLUMBIA COLUMBIA
GOVERNMENT SECURITIES INCOME SECURITIES MUNICIPAL BOND HIGH YIELD
Year Ended December 31, 1997 FUND, INC. FUND, INC. FUND, INC. FUND, INC.
--------------------- ----------------- -------------- -----------
<S> <C> <C> <C> <C>
INVESTMENT INCOME:
Income:
Interest................................. $2,284,819 $25,828,885 $21,295,777 $3,184,666
----------- ----------------- -------------- -----------
Total income........................... 2,284,819 25,828,885 21,295,777 3,184,666
----------- ----------------- -------------- -----------
Expenses:
Investment management fees (Note 4)...... 194,230 1,821,809 1,952,213 211,632
Shareholder servicing costs (Note 4)..... 59,553 315,560 124,730 43,233
Reports to shareholders.................. 12,689 80,510 25,942 11,708
Accounting expense....................... 28,508 37,923 29,953 34,145
Financial information and
subscriptions........................... 1,051 15,912 37,910 3,564
Custodian fees........................... 1,530 14,491 15,412 1,388
Bank transaction and checking fees....... 2,345 24,208 4,572 3,740
Registration fees........................ 16,104 38,435 15,190 27,510
Legal, insurance and auditing fees....... 22,084 37,787 34,199 20,525
Other.................................... 673 4,224 8,930 358
----------- ----------------- -------------- -----------
338,767 2,390,859 2,249,051 357,803
Expenses reimbursed by investment advisor
(1)..................................... (5,959)
----------- ----------------- -------------- -----------
Total expenses......................... 338,767 2,390,859 2,249,051 351,844
----------- ----------------- -------------- -----------
Net investment income (Note 1)............. 1,946,052 23,438,026 19,046,726 2,832,822
----------- ----------------- -------------- -----------
REALIZED GAIN AND UNREALIZED APPRECIATION
FROM INVESTMENT TRANSACTIONS:
Net realized gain from investments (Note
2)........................................ 147,024 2,758,117 2,429,586 1,148,575
Net unrealized appreciation on investments
during the period (Note 1)................ 63,763 7,594,450 10,155,954 279,884
----------- ----------------- -------------- -----------
Net gain on investments (Note 1)........... 210,787 10,352,567 12,585,540 1,428,459
----------- ----------------- -------------- -----------
Net increase in net assets resulting from
operations................................ $2,156,839 $33,790,593 $31,632,266 $4,261,281
----------- ----------------- -------------- -----------
----------- ----------------- -------------- -----------
(1) The Advisor has voluntarily agreed to assume the ordinary expenses of the Fund to the extent that these expenses,
together with the Fund's advisory fee, exceed 1% of the Fund's average net assets.
</TABLE>
The accompanying notes are an integral part of the financial statements.
66
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
-----------------------------------------------------------------
<TABLE>
<CAPTION>
COLUMBIA COLUMBIA COLUMBIA
COMMON STOCK GROWTH INTERNATIONAL STOCK
Years Ended December 31, FUND, INC. FUND, INC. FUND, INC.
--------------------------- ------------------------------- ---------------------------
1997 1996 1997 1996 1997 1996
------------ ------------ -------------- -------------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
INCREASE IN NET ASSETS:
Operations:
Net investment income........ $ 9,354,883 $ 5,885,201 $ 6,692,676 $ 6,027,740 $ 276,986 $ 254,666
Net realized gain (loss)
from:
Investments (Note 2)....... 61,630,849 70,666,274 150,238,079 154,006,111 17,347,526 9,808,805
Foreign currency
transactions (Note 1)..... (286,335) 1,454,573
Change in net unrealized
appreciation (depreciation)
on:
Investments................ 76,981,002 8,532,253 122,000,869 21,295,845 (1,735,993) 5,676,201
Translation of assets and
liabilities in foreign
currencies (Note 1)....... (67,221) 185,947
------------ ------------ -------------- -------------- ------------ ------------
Net increase in net assets
resulting from operations... 147,966,734 85,083,728 278,931,624 181,329,696 15,534,963 17,380,192
Distributions to shareholders:
From net investment income... (8,468,207) (5,169,680) (5,838,423) (5,089,302) (254,666)
In excess of net investment
income...................... (24,695)* (1,646,464)*
From net realized gain from
investment and foreign
currency transactions....... (61,141,619) (70,666,274) (148,364,649) (154,006,111) (16,691,558) (9,422,995)
In excess of net realized
gain from investment
transactions................ (97,665)* (469,156)*
Capital share transactions, net
(Note 3)...................... 168,789,109 169,111,664 136,089,618 193,603,540 21,927,539 18,580,064
------------ ------------ -------------- -------------- ------------ ------------
Net increase in net assets... 247,146,017 178,237,078 260,818,170 215,368,667 20,770,944 24,636,131
NET ASSETS:
Beginning of period............ 536,759,802 358,522,724 1,064,099,519 848,730,852 125,509,591 100,873,460
------------ ------------ -------------- -------------- ------------ ------------
End of period (1).............. $783,905,819 $536,759,802 $1,324,917,689 $1,064,099,519 $146,280,535 $125,509,591
------------ ------------ -------------- -------------- ------------ ------------
------------ ------------ -------------- -------------- ------------ ------------
- ---------------------------------
------------ ------------ -------------- -------------- ------------ ------------
</TABLE>
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
(1) Includes undistributed net
investment income of: $ 1,537,363 $ 901,158 $ 1,999,579 $ 1,931,709 $ -- $ 3,885
* On a tax basis, there was no return of capital.
</TABLE>
The accompanying notes are an integral part of the financial statements.
67
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
-----------------------------------------------------------------
<TABLE>
<CAPTION>
COLUMBIA COLUMBIA COLUMBIA
SPECIAL SMALL CAP REAL ESTATE EQUITY
Years Ended December 31, FUND, INC. FUND, INC. FUND, INC.
--------------------------------- --------------------------- ----------------------------
1997 1996 1997 1996 (2) 1997 1996
--------------- --------------- ------------ ------------ ------------- ------------
<S> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET
ASSETS:
Operations:
Net investment income
(loss)................... $ 531,773 $ (4,487,503) $ (443,585) $ (126) $ 5,578,378 $ 1,994,016
Net realized gain (loss)
from investments (Note
2)....................... 122,678,842 295,204,950 4,931,098 (275,796) 3,597,873 1,627,328
Change in net unrealized
appreciation
(depreciation) on
investments.............. 49,916,627 (112,950,905) 7,895,606 1,488,753 16,211,982 9,368,906
--------------- --------------- ------------ ------------ ------------- ------------
Net increase in net assets
resulting from
operations............... 173,127,242 177,766,542 12,383,119 1,212,831 25,388,233 12,990,250
Distributions to
shareholders:
From net investment
income................... (4,230,674) (1,370,203)
From net realized gain
from investment
transactions............. (122,678,842) (289,460,071) (4,258,935) (3,597,873) (1,627,328)
In excess of net realized
gain from investment
transactions............. (154,157)* (243,742)* (349,207)*
From tax return of
capital.................. (1,252,467) (657,602)
Capital share transactions,
net (Note 3)............... (385,860,660) 312,562,708 67,245,755 19,848,539 67,417,742 37,500,111
--------------- --------------- ------------ ------------ ------------- ------------
Net increase (decrease) in
net assets............... (335,566,417) 200,869,179 75,369,939 21,061,370 83,481,219 46,486,021
NET ASSETS:
Beginning of period......... 1,585,284,214 1,384,415,035 21,061,370 68,073,221 21,587,200
--------------- --------------- ------------ ------------ ------------- ------------
End of period (1)........... $ 1,249,717,797 $ 1,585,284,214 $ 96,431,309 $ 21,061,370 $ 151,554,440 $ 68,073,221
--------------- --------------- ------------ ------------ ------------- ------------
--------------- --------------- ------------ ------------ ------------- ------------
- ------------------------------
--------------- --------------- ------------ ------------ ------------- ------------
</TABLE>
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
(1) Includes undistributed net
investment income (loss)
of:.......................... $ 360,073 $ -- $ -- $ (126) $ -- $ --
(2) From inception of
operations on September 11,
1996.
* On a tax basis, there was no return of capital.
</TABLE>
The accompanying notes are an integral part of the financial statements.
68
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
-----------------------------------------------------------------
<TABLE>
<CAPTION>
COLUMBIA COLUMBIA COLUMBIA
BALANCED DAILY INCOME U.S. GOVERNMENT
Years Ended December 31, FUND, INC. COMPANY SECURITIES FUND, INC.
----------------------------- ------------------------------- ---------------------------
1997 1996 1997 1996 1997 1996
------------- ------------- --------------- ------------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
Operations:
Net investment income.......... $ 29,022,353 $ 22,231,964 $ 44,915,266 $ 40,303,114 $ 1,946,052 $ 2,058,101
Net realized gain from
investments (Note 2).......... 62,144,958 41,189,499 147,024 83,457
Change in net unrealized
appreciation (depreciation) on
investments................... 38,270,990 4,167,518 63,763 (584,568)
------------- ------------- --------------- ------------- ------------ ------------
Net increase in net assets
resulting from operations..... 129,438,301 67,588,981 44,915,266 40,303,114 2,156,839 1,556,990
Distributions to shareholders:
From net investment income..... (28,593,156) (21,892,044) (44,915,266) (40,303,114) (1,946,052) (2,058,101)
In excess of net investment
income........................ (124,615)*
From net realized gain from
investment transactions....... (61,376,451) (41,189,499)
In excess of net realized gain
from investment transaction... (97,205)*
Capital share transactions, net
(Note 3)........................ 80,316,642 181,539,809 279,295,599 89,144,447 (3,150,453) (564,932)
------------- ------------- --------------- ------------- ------------ ------------
Net increase (decrease) in net
assets........................ 119,785,336 185,825,427 279,295,599 89,144,447 (2,939,666) (1,066,043)
NET ASSETS:
Beginning of period.............. 672,592,920 486,767,493 889,799,969 800,655,522 40,776,341 41,842,384
------------- ------------- --------------- ------------- ------------ ------------
End of period.................... $ 792,378,256 $ 672,592,920 $ 1,169,095,568 $ 889,799,969 $ 37,836,675 $ 40,776,341
------------- ------------- --------------- ------------- ------------ ------------
------------- ------------- --------------- ------------- ------------ ------------
- -----------------------------------
------------- ------------- --------------- ------------- ------------ ------------
</TABLE>
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
(1) Includes undistributed net
investment income of: $ 758,037 $ 540,163
* On a tax basis, there was no return of capital.
</TABLE>
The accompanying notes are an integral part of the financial statements.
69
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
-----------------------------------------------------------------
<TABLE>
<CAPTION>
COLUMBIA COLUMBIA COLUMBIA
FIXED INCOME SECURITIES MUNICIPAL BOND HIGH YIELD
Years Ended December 31, FUND, INC. FUND, INC. FUND, INC.
-------------------------- ---------------------------- --------------------------
1997 1996 1997 1996 1997 1996
------------ ------------ ------------- ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
Operations:
Net investment income................... $ 23,438,026 $ 21,823,484 $ 19,046,726 $ 18,837,582 $ 2,832,822 $ 2,084,562
Net realized gain from investments (Note
2)..................................... 2,758,117 1,600,093 2,429,586 1,991,804 1,148,575 237,862
Change in net unrealized appreciation
(depreciation) on investments.......... 7,594,450 (11,107,884) 10,155,954 (7,232,960) 279,884 (1,892)
------------ ------------ ------------- ------------ ------------ ------------
Net increase in net assets resulting
from operations........................ 33,790,593 12,315,693 31,632,266 13,596,426 4,261,281 2,320,532
Distributions to shareholders:
From net investment income.............. (23,438,026) (21,823,484) (19,046,726) (18,837,582) (2,832,822) (2,084,562)
In excess of net investment income...... (4,724)*
From net realized gain from investment
transactions........................... (847,470) (2,276,966) (1,842,655) (1,136,542) (28,544)
Capital share transactions, net (Note
3)....................................... 15,406,761 49,669,884 23,176,895 (1,044,677) 10,168,259 5,139,840
------------ ------------ ------------- ------------ ------------ ------------
Net increase (decrease) in net assets... 24,911,858 40,162,093 33,480,745 (8,128,488) 10,460,176 5,347,266
NET ASSETS:
Beginning of period....................... 356,420,896 316,258,803 375,667,430 383,795,918 28,818,233 23,470,967
------------ ------------ ------------- ------------ ------------ ------------
End of period............................. $381,332,754 $356,420,896 $ 409,148,175 $375,667,430 $ 39,278,409 $ 28,818,233
------------ ------------ ------------- ------------ ------------ ------------
------------ ------------ ------------- ------------ ------------ ------------
* On a tax basis, there was no return of capital.
</TABLE>
The accompanying notes are an integral part of the financial statements.
70
<PAGE>
NOTES TO FINANCIAL STATEMENTS
-----------------------------------------------------------------
-- 1. SIGNIFICANT ACCOUNTING POLICIES --
The Columbia Funds (the Funds) consist of Columbia Common Stock Fund, Inc.
(CCSF), Columbia Growth Fund, Inc. (CGF), Columbia International Stock Fund,
Inc. (CISF), Columbia Special Fund, Inc. (CSF), Columbia Small Cap Fund, Inc.
(CSCF), Columbia Real Estate Equity Fund, Inc. (CREF), Columbia Balanced Fund,
Inc. (CBF), Columbia Daily Income Company (CDIC), Columbia U.S. Government
Securities Fund, Inc. (CUSG), Columbia Fixed Income Securities Fund, Inc.
(CFIS), Columbia Municipal Bond Fund, Inc. (CMBF), and Columbia High Yield Fund,
Inc. (CHYF). All Funds are open-end investment companies registered under the
Investment Company Act of 1940, as amended, and are diversified except CMBF,
which is non-diversified. The policies described below are consistently followed
by the Funds in the preparation of their financial statements in conformity with
generally accepted accounting principles.
INVESTMENT VALUATION. The values of CCSF, CGF, CISF, CSF, CSCF, CREF and CBF
equity investments are based on the last sale prices reported by the principal
securities exchanges on which the investments are traded, or, in the absence of
recorded sales, at the closing bid prices on such exchanges or over-the-counter
markets. Temporary cash investments in short-term securities (principally
repurchase agreements) are valued at cost, which approximates market.
CDIC investments are carried at values deemed best to reflect their fair
values as determined in good faith by or under the supervision of officers of
CDIC, specifically so authorized by its Directors. These values are based on
cost adjusted for amortization of discount or premium and accrued interest,
unless unusual circumstances indicate that another method of determining fair
value should be considered.
CBF, CUSG, CFIS, CMBF and CHYF fixed income investments are carried at
values deemed best to reflect their fair values as determined in good faith
under consistently applied procedures by or under the supervision of officers of
the investment advisor to those Funds specifically so authorized by their
Directors. These values are based on market value as quoted by dealers who are
market makers in these securities or by an independent pricing service unless
unusual circumstances indicate that another method of determining fair value
should be considered. Market values for CBF, CUSG, CFIS and CHYF fixed income
investments are based on the average of bid and ask prices and market value for
CMBF is based on bid prices, or by reference to other securities with comparable
ratings, interest rates and maturities. Temporary cash investments in short-term
securities (principally repurchase agreements) are valued at cost, which
approximates market.
71
<PAGE>
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
-- 1. SIGNIFICANT ACCOUNTING POLICIES, CONTINUED --
AFFILIATED ISSUERS. Under the Investment Company Act of 1940, as amended, an
issuer is an "affiliated issuer" of a Fund if the Fund holds 5% or more of that
issuer's outstanding voting securities or is held under common control. CSF and
CBF had investments in such affiliated issuers at December 31, 1997 as follows:
<TABLE>
<CAPTION>
DIVIDEND AND
BALANCE OF BALANCE OF INTEREST INCOME
SHARES/PRINCIPAL SHARES/PRINCIPAL JANUARY 1,
HELD GROSS GROSS HELD VALUE 1997-
DECEMBER 31, PURCHASES & SALES & DECEMBER 31, DECEMBER 31, DECEMBER 31,
NAME OF ISSUER 1996 ADDITIONS REDUCTIONS 1997 1997 1997
- ------------------------------ ---------------- ----------- ---------- ---------------- ------------- ---------------
Columbia Special Fund (a)
<S> <C> <C> <C> <C> <C> <C>
Abercrombie & Fitch Co........ -- 800,000 800,000 $ 25,000,000
Celadon Group, Inc............ 580,000 80,000 500,000 6,750,000
Gadzooks, Inc................. -- 700,000 700,000 14,700,000
Harmonic Lightwaves, Inc...... 540,000 540,000 -- --
Integrated Measurement
Syst......................... 170,000 290,000 160,000 300,000 5,137,500
Osmonics, Inc................. 400,000 469,000 869,000 13,741,063
Resmed, Inc................... 605,000 105,000 500,000 14,062,500
Schnitzer Steel Industries.... 500,000 50,000 550,000 15,434,375 $107,500
United Dental Care............ 487,500 487,500 -- --
Vans, Inc..................... -- 860,000 860,000 13,007,500
------------- ---------------
107,832,938 107,500
Columbia Balanced Fund (b)
Fleet Mortgage Group, Inc..... 550,000 550,000 552,937 35,750
------------- ---------------
Total affiliated issuers.................................................................. $ 108,385,875 $143,250
------------- ---------------
------------- ---------------
</TABLE>
(a) Fund holds 5% or more of that issuer's outstanding shares.
(b) Fund holds an investment under common control. (Note 4)
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS. CISF enters into forward foreign
currency exchange contracts to hedge certain portfolio securities denominated in
foreign currencies. Forward contracts are recorded at market value. CISF could
be exposed to risks if counterparties to the forward contracts are unable to
meet the terms of their contracts or if the value of the foreign currency
changes unfavorably. The effect of any change in the value of a hedged foreign
currency would be offset by the increase (resulting from a change in exchange
rates) in value of the securities denominated in that currency. Net realized
gains arising from forward contracts amounted to $241,528 and are included in
net realized gain from foreign currency transactions. As of December 31, 1997,
CISF had entered into the following forward contract resulting in net unrealized
appreciation of $129,673.
72
<PAGE>
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
-- 1. SIGNIFICANT ACCOUNTING POLICIES, --
CONTINUED
<TABLE>
<CAPTION>
JAPANESE YEN U.S. DOLLARS NET
TO TO SETTLEMENT UNREALIZED
BE DELIVERED BE RECEIVED DATE APPRECIATION
- -------------- -------------- ---------- -------------
<S> <C> <C> <C>
Y3,370,000,000 $ 26,154,849 01/28/1998 $ 129,673
</TABLE>
FOREIGN CURRENCY TRANSLATIONS. The books and records of CISF are maintained in
U.S. dollars. Foreign currency transactions are translated into U.S. dollars on
the following basis:
(i) market value of investment securities, other assets, and liabilities at the
daily rates of exchange on the valuation date, and
(ii) purchases and sales of investment securities, dividend and interest income
and certain expenses at the rates of exchange prevailing on the respective
dates of such transactions.
CISF does not isolate that portion of the results of operations resulting
from changes in foreign exchange rates on investments from the fluctuations
arising from changes in market prices of securities held. Such changes are
included with the net realized and unrealized gain or loss from investments.
Reported net realized foreign currency gains or losses arise from sales of
foreign currencies, currency gains or losses realized between the trade and
settlement dates on securities transactions, and the difference between the
amounts of dividends, interest, and foreign withholding taxes recorded on CISF's
books and the U.S. dollar equivalent of the amounts actually received or paid.
Net unrealized foreign exchange gains and losses arise from changes in the value
of assets and liabilities, other than investments in securities, resulting from
changes in the exchange rates.
INTEREST AND DIVIDEND INCOME. Interest income is recorded on the accrual basis
and dividend income is recorded on the ex-dividend date. Amortization of
discount or premium is recorded over the life of the respective instrument. The
majority of dividend income recorded by CREF is from Real Estate Investment
Trusts (REITs). For tax purposes, a portion of these dividends consist of
capital gains and return of capital. For financial reporting purposes, these
dividends are recorded as dividend income.
SHAREHOLDER DISTRIBUTIONS. CCSF, CREF and CBF distribute net investment income
quarterly and any net realized gains from investment transactions annually. CGF,
CISF, CSF and CSCF distribute net investment income and any net realized gains
annually. CDIC distributes its net investment income daily -- including any
realized investment gains or losses. CUSG, CFIS, CMBF and CHYF distribute their
net investment income monthly and any net realized gains annually. Distributions
to shareholders are recorded on the ex-dividend date.
Income 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 for
foreign currency transactions, net operating losses, deferral of losses from
wash sales, passive foreign investment company income and return of capital
received from REITS.
USE OF ESTIMATES. The preparation of the financial statements in accordance
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosures 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.
FEDERAL INCOME TAXES. The Funds have made no provision for federal income taxes
on net investment income or net realized gains from sales of securities, since
it is the intention of the Funds to comply with the provisions of the Internal
Revenue Code available to certain investment companies, and to make
distributions of income and security profits sufficient to relieve them from
substantially all federal income taxes.
73
<PAGE>
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
-- 1. SIGNIFICANT ACCOUNTING POLICIES, --
CONTINUED
As of December 31, 1997, CUSG has $242,419 in capital loss carryovers
available to offset future capital gains which expire in 2002.
To the extent that the capital loss carryovers are used to offset any
capital gains, it is unlikely that the gains so offset will be distributed to
shareholders.
OTHER. Investment transactions are accounted for on the date the investments
are purchased or sold. The cost of investments sold is determined by the use of
the specific identification method for both financial reporting and income tax
purposes. Realized gains and losses from investment transactions and unrealized
appreciation or depreciation of investments are reported on the basis of
identified costs.
The Funds, through their custodians, receive delivery of underlying
securities collateralizing repurchase agreements (included in temporary cash
investments). Market values of these securities are required to be at least 100%
of the cost of the repurchase agreements. The Funds' investment advisor
determines that the value of the underlying securities is at all times at least
equal to the resale price. In the event of default or bankruptcy by the other
party to the agreement, realization and/or retention of the collateral may be
subject to legal proceedings.
CHYF invests in lower rated debt securities, which may be more susceptible
to adverse economic conditions than investment grade holdings. These securities
are often subordinated to the prior claims of other senior lenders, and
uncertainties exist as to an issuer's ability to meet principal and interest
payments. At December 31, 1997, 41% of the Fund's debt securities were rated Ba
and 59% were rated B by Moody's Investor Services, Inc.
74
<PAGE>
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
-- 2. INVESTMENT TRANSACTIONS --
Aggregate purchases, sales and maturities, net realized gain and unrealized
appreciation (depreciation) of investments, including temporary cash investments
for CDIC and excluding temporary cash investments for all other Funds, as of and
for the period ended December 31, 1997, were as follows:
<TABLE>
<CAPTION>
COLUMBIA COLUMBIA COLUMBIA COLUMBIA
COMMON STOCK GROWTH INTERNATIONAL STOCK SPECIAL
FUND, INC. (CCSF) FUND, INC. (CGF) FUND, INC. (CISF) FUND, INC. (CSF)
----------------- ---------------- ------------------- ----------------
PURCHASES:
<S> <C> <C> <C> <C>
Investment securities other than
U.S. Government obligations..... $649,705,323 $1,132,681,444 $166,070,521 $2,285,721,068
----------------- ---------------- ------------------- ----------------
----------------- ---------------- ------------------- ----------------
SALES AND MATURITIES:
Investment securities other than
U.S. Government obligations..... $569,259,757 $1,154,366,139 $168,627,388 $2,727,547,308
----------------- ---------------- ------------------- ----------------
----------------- ---------------- ------------------- ----------------
NET REALIZED GAIN:
Investment securities other than
U.S. Government obligations..... $ 61,630,849 $ 150,238,079 $ 17,347,526 $ 122,678,842
----------------- ---------------- ------------------- ----------------
----------------- ---------------- ------------------- ----------------
UNREALIZED APPRECIATION
(DEPRECIATION) AS OF DECEMBER 31,
1997:
Appreciation..................... $148,390,643 $ 327,736,887 $ 23,089,195 $ 199,310,779
Depreciation..................... (10,521,532) (24,468,865) (8,182,034) (61,111,074)
----------------- ---------------- ------------------- ----------------
Net unrealized appreciation.... $137,869,111 $ 303,268,022 $ 14,907,125 $ 138,199,705
----------------- ---------------- ------------------- ----------------
----------------- ---------------- ------------------- ----------------
UNREALIZED APPRECIATION
(DEPRECIATION) FOR FEDERAL INCOME
TAX PURPOSES AS OF DECEMBER 31,
1997:
Appreciation..................... $149,383,139 $ 329,136,822 $ 23,079,940 $ 199,396,129
Depreciation..................... (10,521,532) (24,763,294) (8,267,962) (62,132,757)
----------------- ---------------- ------------------- ----------------
Net unrealized appreciation.... $138,861,607 $ 304,373,528 $ 14,811,978 $ 137,263,372
----------------- ---------------- ------------------- ----------------
----------------- ---------------- ------------------- ----------------
For federal income tax purposes,
the cost of investments owned at
December 31, 1997................. $590,091,210 $ 997,456,659 $115,448,050 $1,081,321,466
----------------- ---------------- ------------------- ----------------
----------------- ---------------- ------------------- ----------------
</TABLE>
The net realized gain for CCSF, CGF, & CSF includes proceeds of $2,242,
$361,277, & $672,539, respectively, from shareholder class action suits related
to securities held by those Funds.
75
<PAGE>
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
-- 2. INVESTMENT TRANSACTIONS, CONTINUED --
<TABLE>
<CAPTION>
COLUMBIA
COLUMBIA REAL ESTATE COLUMBIA COLUMBIA
SMALL CAP EQUITY FUND, INC. BALANCED DAILY INCOME
FUND, INC. (CSCF) (CREF) FUND, INC. (CBF) COMPANY (CDIC)
----------------- ----------------- ---------------- ---------------
<S> <C> <C> <C> <C>
PURCHASES:
Investment securities other than U.S.
Government obligations............... $147,752,870 $ 99,553,326 $ 565,825,789 $9,939,776,531
U.S. Government obligations........... 604,980,516 33,659,217
----------------- ----------------- ---------------- ---------------
Total purchases..................... $147,752,870 $ 99,553,326 $1,170,806,305 $9,973,435,748
----------------- ----------------- ---------------- ---------------
----------------- ----------------- ---------------- ---------------
SALES AND MATURITIES:
Investment securities other than U.S.
Government obligations............... $ 86,451,984 $ 35,352,329 $ 509,635,998 $9,669,083,804
U.S. Government obligations........... 613,086,023 33,659,217
----------------- ----------------- ---------------- ---------------
Total sales and maturities.......... $ 86,451,984 $ 35,352,329 $1,122,722,021 $9,702,743,021
----------------- ----------------- ---------------- ---------------
----------------- ----------------- ---------------- ---------------
NET REALIZED GAIN:
Investment securities other than U.S.
Government obligations............... $ 4,931,098 $ 3,597,873 $ 60,242,570
U.S. Government obligations........... 1,902,388
----------------- ----------------- ----------------
Total net realized gain............. $ 4,931,098 $ 3,597,873 $ 62,144,958
----------------- ----------------- ----------------
----------------- ----------------- ----------------
UNREALIZED APPRECIATION (DEPRECIATION)
AS OF DECEMBER 31, 1997:...............
Appreciation.......................... $ 12,040,728 $ 27,174,929 $ 98,838,009
Depreciation.......................... (2,656,369) (58,115) (4,517,651)
----------------- ----------------- ----------------
Net unrealized appreciation......... $ 9,384,359 $ 27,116,814 $ 94,320,358
----------------- ----------------- ----------------
----------------- ----------------- ----------------
UNREALIZED APPRECIATION (DEPRECIATION)
FOR FEDERAL INCOME TAX PURPOSES AS OF
DECEMBER 31, 1997:
Appreciation.......................... $ 12,028,865 $ 29,011,667 $ 99,512,204
Depreciation.......................... (2,704,005) (58,115) (4,608,500)
----------------- ----------------- ----------------
Net unrealized appreciation......... $ 9,324,860 $ 28,953,552 $ 94,903,704
----------------- ----------------- ----------------
----------------- ----------------- ----------------
For federal income tax purposes, the
cost of investments owned at December
31, 1997............................... $ 84,013,201 $111,208,205 $ 686,783,832 $1,173,657,688
----------------- ----------------- ---------------- ---------------
----------------- ----------------- ---------------- ---------------
</TABLE>
The net realized gain for CBF includes proceeds of $2,236 from shareholder class
action suits related to securities held by the Fund.
- --------------------------------------------------------------------------------
76
<PAGE>
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
-- 2. INVESTMENT TRANSACTIONS, CONTINUED --
<TABLE>
<CAPTION>
COLUMBIA U.S. COLUMBIA FIXED COLUMBIA COLUMBIA
GOVERNMENT SECURITIES INCOME SECURITIES MUNICIPAL BOND HIGH YIELD
FUND, INC. (CUSG) FUND, INC. (CFIS) FUND, INC. (CMBF) FUND, INC. (CHYF)
--------------------- ----------------- ----------------- -----------------
PURCHASES:
<S> <C> <C> <C> <C>
Investment securities other than U.S.
Government obligations............... $205,016,907 $ 81,001,133 $46,508,531
U.S. Government obligations........... $77,834,027 514,542,364 747,187
--------------------- ----------------- ----------------- -----------------
Total purchases..................... $77,834,027 $719,559,271 $ 81,001,133 $47,255,718
--------------------- ----------------- ----------------- -----------------
--------------------- ----------------- ----------------- -----------------
SALES AND MATURITIES:
Investment securities other than U.S.
Government obligations............... $179,565,984 $ 64,319,420 $39,446,080
U.S. Government obligations........... $81,184,234 528,675,378 1,240,234
--------------------- ----------------- ----------------- -----------------
Total sales and maturities.......... $81,184,234 $708,241,362 $ 64,319,420 $40,686,314
--------------------- ----------------- ----------------- -----------------
--------------------- ----------------- ----------------- -----------------
NET REALIZED GAIN (LOSS):
Investment securities other than U.S.
Government obligations............... $ (80,814) $ 2,429,586 $ 1,165,879
U.S. Government obligations........... $ 147,024 2,838,931 (17,304)
--------------------- ----------------- ----------------- -----------------
Total net realized gain............. $ 147,024 $ 2,758,117 $ 2,429,586 $ 1,148,575
--------------------- ----------------- ----------------- -----------------
--------------------- ----------------- ----------------- -----------------
UNREALIZED APPRECIATION (DEPRECIATION)
AS OF DECEMBER 31, 1997:
Appreciation.......................... $ 103,729 $ 9,785,428 $ 24,070,747 $ 1,157,854
Depreciation.......................... (12,779) (185,534) (7,377) (27,190)
--------------------- ----------------- ----------------- -----------------
Net unrealized appreciation......... $ 90,950 $ 9,599,894 $ 24,063,370 $ 1,130,664
--------------------- ----------------- ----------------- -----------------
--------------------- ----------------- ----------------- -----------------
UNREALIZED APPRECIATION (DEPRECIATION)
FOR FEDERAL INCOME TAX PURPOSES AS OF
DECEMBER 31, 1997:
Appreciation.......................... $ 96,870 $ 9,785,428 $ 24,061,804 $ 1,157,854
Depreciation.......................... (12,779) (186,732) (7,377) (27,190)
--------------------- ----------------- ----------------- -----------------
Net unrealized appreciation......... $ 84,091 $ 9,598,696 $ 24,054,427 $ 1,130,664
--------------------- ----------------- ----------------- -----------------
--------------------- ----------------- ----------------- -----------------
For federal income tax purposes, the
cost of investments owned at December
31, 1997............................... $37,026,159 $352,107,930 $373,395,102 $34,017,097
--------------------- ----------------- ----------------- -----------------
--------------------- ----------------- ----------------- -----------------
</TABLE>
- --------------------------------------------------------------------------------
77
<PAGE>
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
-- 3. CAPITAL STOCK --
<TABLE>
<CAPTION>
COLUMBIA COLUMBIA COLUMBIA
COMMON STOCK GROWTH INTERNATIONAL STOCK
FUND, INC. (CCSF) FUND, INC. (CGF) FUND, INC. (CISF)
----------------------------- ------------------------------- -----------------------------
1997 1996 1997 1996 1997 1996
------------- ------------- -------------- -------------- ------------- -------------
SHARES:
<S> <C> <C> <C> <C> <C> <C>
Shares sold................... 12,609,458 9,187,403 9,453,209 9,588,118 6,414,910 4,458,919
Shares issued for reinvestment
of dividends................. 3,039,307 3,836,536 4,230,608 4,993,329 1,146,267 808,789
------------- ------------- -------------- -------------- ------------- -------------
15,648,765 13,023,939 13,683,817 14,581,447 7,561,177 5,267,708
Less shares redeemed.......... (7,908,821) (4,449,235) (9,715,431) (8,408,189) (5,939,634) (3,930,959)
------------- ------------- -------------- -------------- ------------- -------------
Net increase in shares........ 7,739,944 8,574,704 3,968,386 6,173,258 1,621,543 1,336,749
------------- ------------- -------------- -------------- ------------- -------------
------------- ------------- -------------- -------------- ------------- -------------
AMOUNTS:
Sales......................... $ 277,332,028 $ 183,843,205 $ 329,861,186 $ 309,798,468 $ 98,515,375 $ 62,941,735
Reinvestment of dividends..... 66,961,124 74,699,264 145,279,077 154,190,774 15,703,862 11,145,109
------------- ------------- -------------- -------------- ------------- -------------
344,293,152 258,542,469 475,140,263 463,989,242 114,219,237 74,086,844
Less redemptions.............. (175,504,043) (89,430,805) (339,050,645) (270,385,702) (92,291,698) (55,506,780)
------------- ------------- -------------- -------------- ------------- -------------
Net increase.................. $ 168,789,109 $ 169,111,664 $ 136,089,618 $ 193,603,540 $ 21,927,539 $ 18,580,064
------------- ------------- -------------- -------------- ------------- -------------
------------- ------------- -------------- -------------- ------------- -------------
Capital stock authorized
(shares)..................... 100,000,000 100,000,000 100,000,000
Par Value..................... no par $.01 no par
</TABLE>
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
COLUMBIA COLUMBIA COLUMBIA
SPECIAL SMALL CAP REAL ESTATE EQUITY
FUND, INC. (CSF) FUND, INC. (CSCF) FUND, INC. (CREF)
------------------------------- ---------------------------- -----------------------------
1997 1996 1997 1996 (1) 1997 1996
-------------- -------------- ------------- ------------ ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
SHARES:
Shares sold...................... 17,301,738 25,624,116 6,092,245 1,756,650 9,713,082 4,543,366
Shares issued for reinvestment of
dividends....................... 5,787,116 13,826,136 229,093 444,904 226,545
-------------- -------------- ------------- ------------ ------------- -------------
23,088,854 39,450,252 6,321,338 1,756,650 10,157,986 4,769,911
Less shares redeemed............. (41,278,382) (24,162,690) (2,149,149) (135,869) (6,308,136) (2,255,778)
-------------- -------------- ------------- ------------ ------------- -------------
Net increase (decrease) in
shares.......................... (18,189,528) 15,287,562 4,172,189 1,620,781 3,849,850 2,514,133
-------------- -------------- ------------- ------------ ------------- -------------
-------------- -------------- ------------- ------------ ------------- -------------
AMOUNTS:
Sales............................ $ 365,659,534 $ 593,195,434 $ 97,707,061 $ 21,545,009 $ 168,764,062 $ 65,389,802
Reinvestment of dividends........ 117,246,979 273,619,242 3,814,406 8,209,513 3,428,343
-------------- -------------- ------------- ------------ ------------- -------------
482,906,513 866,814,676 101,521,467 21,545,009 176,973,575 68,818,145
Less redemptions................. (868,767,173) (554,251,968) (34,275,712) (1,696,470) (109,555,833) (31,318,034)
-------------- -------------- ------------- ------------ ------------- -------------
Net increase (decrease).......... $ (385,860,660) $ 312,562,708 $ 67,245,755 $ 19,848,539 $ 67,417,742 $ 37,500,111
-------------- -------------- ------------- ------------ ------------- -------------
-------------- -------------- ------------- ------------ ------------- -------------
Capital stock authorized
(shares)........................ 100,000,000 100,000,000 100,000,000
Par Value........................ $ .01 no par no par
</TABLE>
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
(1) From inception of operations
on September 11, 1996.
</TABLE>
- --------------------------------------------------------------------------------
78
<PAGE>
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
-- 3. CAPITAL STOCK, CONTINUED --
<TABLE>
<CAPTION>
COLUMBIA COLUMBIA COLUMBIA U.S.
BALANCED DAILY INCOME GOVERNMENT SECURITIES
FUND, INC. (CBF) COMPANY (CDIC) FUND, INC. (CUSG)
----------------------------- --------------------------------- ---------------------------
1997 1996 1997 1996 1997 1996
------------- ------------- --------------- --------------- ------------ ------------
SHARES:
<S> <C> <C> <C> <C> <C> <C>
Shares sold................... 11,631,390 12,203,107 1,948,660,105 1,425,767,034 1,678,641 1,751,071
Shares issued for reinvestment
of dividends................. 4,143,787 3,066,051 44,892,534 40,287,100 214,917 230,872
------------- ------------- --------------- --------------- ------------ ------------
15,775,177 15,269,158 1,993,552,639 1,466,054,134 1,893,558 1,981,943
Less shares redeemed.......... (11,880,698) (6,405,495) (1,714,257,040) (1,376,909,687) (2,278,311) (2,051,336)
------------- ------------- --------------- --------------- ------------ ------------
Net increase (decrease) in
shares....................... 3,894,479 8,863,663 279,295,599 89,144,447 (384,753) (69,393)
------------- ------------- --------------- --------------- ------------ ------------
------------- ------------- --------------- --------------- ------------ ------------
AMOUNTS:
Sales......................... $ 255,961,711 $ 251,516,248 $ 1,948,660,105 $ 1,425,767,034 $ 13,843,228 $ 14,407,264
Reinvestment of dividends..... 89,309,106 62,884,919 44,892,534 40,287,100 1,771,509 1,898,935
------------- ------------- --------------- --------------- ------------ ------------
345,270,817 314,401,167 1,993,552,639 1,466,054,134 15,614,737 16,306,199
Less redemptions.............. (264,954,175) (132,861,358) (1,714,257,040) (1,376,909,687) (18,765,190) (16,871,131)
------------- ------------- --------------- --------------- ------------ ------------
Net increase (decrease)....... $ 80,316,642 $ 181,539,809 $ 279,295,599 $ 89,144,447 $ (3,150,453) $ (564,932)
------------- ------------- --------------- --------------- ------------ ------------
------------- ------------- --------------- --------------- ------------ ------------
Capital stock authorized
(shares)..................... 100,000,000 2,000,000,000 100,000,000
Par Value..................... no par $.001 $.01
</TABLE>
<TABLE>
<CAPTION>
COLUMBIA FIXED COLUMBIA COLUMBIA
INCOME SECURITIES MUNICIPAL BOND HIGH YIELD
FUND, INC. (CFIS) FUND, INC. (CMBF) FUND, INC. (CHYF)
----------------------------- ----------------------------- -----------------------------
1997 1996 1997 1996 1997 1996
------------- ------------- ------------- ------------- ------------- -------------
SHARES:
<S> <C> <C> <C> <C> <C> <C>
Shares sold...................... 8,909,289 9,571,457 6,372,612 4,732,337 2,127,208 1,058,203
Shares issued for reinvestment of
dividends....................... 1,456,925 1,427,852 1,369,697 1,395,611 342,994 197,255
------------- ------------- ------------- ------------- ------------- -------------
10,366,214 10,999,309 7,742,309 6,127,948 2,470,202 1,255,458
Less shares redeemed............. (9,188,186) (7,165,704) (5,853,872) (6,210,439) (1,457,004) (730,964)
------------- ------------- ------------- ------------- ------------- -------------
Net increase (decrease) in
shares.......................... 1,178,028 3,833,605 1,888,437 (82,491) 1,013,198 524,494
------------- ------------- ------------- ------------- ------------- -------------
------------- ------------- ------------- ------------- ------------- -------------
AMOUNTS:
Sales............................ $ 117,209,758 $ 124,564,521 $ 77,959,329 $ 57,398,891 $ 21,499,878 $ 10,345,832
Reinvestment of dividends........ 19,185,059 18,580,087 16,813,005 16,930,817 3,460,890 1,925,766
------------- ------------- ------------- ------------- ------------- -------------
136,394,817 143,144,608 94,772,334 74,329,708 24,960,768 12,271,598
Less redemptions................. (120,988,056) (93,474,724) (71,595,439) (75,374,385) (14,792,509) (7,131,758)
------------- ------------- ------------- ------------- ------------- -------------
Net increase (decrease).......... $ 15,406,761 $ 49,669,884 $ 23,176,895 $ (1,044,677) $ 10,168,259 $ 5,139,840
------------- ------------- ------------- ------------- ------------- -------------
------------- ------------- ------------- ------------- ------------- -------------
Capital stock authorized
(shares)........................ 200,000,000 100,000,000 100,000,000
Par Value........................ $.01 $.01 no par
</TABLE>
79
<PAGE>
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
-- 4. TRANSACTIONS WITH AFFILIATES AND RELATED PARTIES --
<TABLE>
<CAPTION>
COLUMBIA
COLUMBIA COLUMBIA COLUMBIA SPECIAL
COMMON STOCK GROWTH INTERNATIONAL STOCK FUND, INC.
FUND, INC. (CCSF) FUND, INC. (CGF) FUND, INC. (CISF) (CSF)
----------------- --------------------- ------------------- ----------
<S> <C> <C> <C> <C>
Investment management fees incurred..... $4,158,273 $7,019,161 $1,504,787 $12,373,140
Investment management fee computation
basis (percentage of daily net assets
per annum)............................. 0.60 of 1% 0.75 of 1% to 1% 1% to
$200,000,000 daily $500,000,000
net assets; 0.625 of daily net
1% between assets;
$200,000,000 and 0.75 of 1%
$500,000,000; and in excess
0.50 of 1% of
in excess of $500,000,000
$500,000,000
Transfer agent fee (included in
shareholder servicing costs)........... $424,958 $857,591 $313,943 $979,562
Fees earned by directors not affiliated
with each Fund's investment advisor,
transfer agent, or Columbia Management
Co..................................... $6,704 $11,980 $1,476 $14,774
Value of investments held at December
31, 1997 by:
Columbia Management Co................ $457,230 $94,101 $62,437 $2,232,560
Columbia Funds Management Company..... $93,330 $44,502 $16,810 $769,764
</TABLE>
<TABLE>
<CAPTION>
COLUMBIA COLUMBIA COLUMBIA COLUMBIA
SMALL CAP REAL ESTATE EQUITY BALANCED DAILY INCOME
FUND, INC. (CSCF) FUND, INC. (CREF) FUND, INC. (CBF) COMPANY (CDIC)
----------------- ------------------ ---------------- ------------------
<S> <C> <C> <C> <C>
Investment management fees incurred..... $547,892 $864,343 $3,826,628 $4,296,685
Investment management fee computation
basis (percentage of daily net assets
per annum)............................. 1% 0.75 of 1% 0.50 of 1% 0.50 of 1% to
$500,000,000 daily
net assets; 0.45
of 1% between
$500,000,000 and
$1,000,000,000;
and 0.40 of 1% in
excess of
$1,000,000,000
Transfer agent fee (included in
shareholder servicing costs)........... $73,575 $131,357 $511,482 $648,992
Fees earned by directors not affiliated
with each Fund's investment advisor,
transfer agent, or Columbia Management
Co..................................... $506 $1,110 $7,503 $8,731
Value of investments held at December
31, 1997 by:
Columbia Management Co................ $139,668 $2,604,160
Columbia Funds Management Company..... $11,827 $24,472 $3,356,624
</TABLE>
- --------------------------------------------------------------------------------
80
<PAGE>
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
-- 4. TRANSACTIONS WITH AFFILIATES AND RELATED PARTIES, CONTINUED --
<TABLE>
<CAPTION>
COLUMBIA U.S. COLUMBIA FIXED COLUMBIA COLUMBIA
GOVERNMENT SECURITIES INCOME SECURITIES MUNICIPAL BOND HIGH YIELD
FUND, INC. (CUSG) FUND, INC. (CFIS) FUND, INC. (CMBF) FUND, INC. (CHYF)
--------------------- ----------------- ----------------- -----------------
<S> <C> <C> <C> <C>
Investment management fees incurred..... $194,230 $1,821,809 $1,952,213 $211,632
Investment management fee computation
basis (percentage of daily net assets
per annum)............................. 0.50 of 1% 0.50 of 1% 0.50 of 1% 0.60 of 1%
Transfer agent fee (included in
shareholder servicing costs)........... $45,009 $249,777 $112,418 $38,316
Fees earned by directors not affiliated
with each Fund's investment advisor,
transfer agent, or Columbia Management
Co..................................... $390 $3,611 $3,867 $348
Value of investments held at December
31, 1997 by:
Columbia Management Co................ $417,550 $1,015,605 $2,066,804 $367,927
Columbia Funds Management Company..... $66,328 $291,606 $293,924 $291,996
</TABLE>
The investment advisor of the Funds is Columbia Funds Management Company (CFMC).
The transfer agent for the Funds is Columbia Trust Company (CTC), a majority
owned subsidiary of CFMC. The transfer agent is compensated based on a per
account fee.
On December 10, 1997, CFMC, CTC and Columbia Management Company (CMC), an
affiliated company, became
- --------------------------------------------------------------------------------
indirect subsidiaries of Fleet Financial Group, Inc. (Fleet), a publicly owned
multi-bank holding company registered under the Bank Holding Company Act of
1956. Prior to that date, certain officers and directors of the Funds were also
officers and directors of CFMC, CTC and CMC. Those individuals did not receive
any compensation or other payment from the Funds. As a result of federal banking
regulations, no officers or directors of the Funds are officers or directors of
CFMC, CTC or CMC following the transaction with Fleet. J. Jerry Inskeep, Jr., an
officer and director of the Funds, is affiliated with Fleet, but receives no
compensation or other payment from the Funds.
As a result of the transaction with Fleet, directors of the Funds were required
to approve new contracts for investment advisory and transfer agent services
between the Funds and CFMC and CTC, respectively. These new contracts are the
same in all material respects to the corresponding previous contracts.
Shareholders of the Funds were required to approve the new investment advisory
contracts. The proxy voting results of the approval by shareholders of the Funds
of those contracts is set forth at the end of this 1997 Annual Report.
81
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
-----------------------------------------------------------------
TO THE SHAREHOLDERS AND BOARD OF DIRECTORS,
Columbia Common Stock Fund, Inc. (CCSF)
Columbia Growth Fund, Inc. (CGF)
Columbia International Stock Fund, Inc. (CISF)
Columbia Small Cap Fund, Inc. (CSCF)
Columbia Special Fund, Inc. (CSF)
Columbia Real Estate Equity Fund, Inc. (CREF)
Columbia Balanced Fund, Inc. (CBF)
Columbia Daily Income Company (CDIC)
Columbia U.S. Government Securities Fund, Inc. (CUSG)
Columbia Fixed Income Securities Fund, Inc. (CFIS)
Columbia Municipal Bond Fund, Inc. (CMBF)
Columbia High Yield Fund, Inc. (CHYF)
We have audited the accompanying statements of assets and liabilities,
including the schedules of investments for each of the twelve funds comprising
Columbia Funds (the "Funds"), as of December 31, 1997, the related statements of
operations for the year then ended, the statements of changes in net assets for
each of the two years in the period then ended, except for CSCF which is for the
period from inception, September 11, 1996 to December 31, 1996 and for the year
ended December 31, 1997 and the financial highlights for each of the periods
indicated therein. These financial statements and financial highlights are the
responsibility of the Funds' management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
December 31, 1997, by correspondence with the custodians and brokers. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of the
twelve funds comprising Columbia Funds enumerated above as of December 31, 1997,
the results of their operations for the year then ended, the changes in their
net assets for each of the two years in the period then ended, except for CSCF
which is for the period from inception, September 11, 1996 to December 31, 1996
and for the year ended December 31, 1997 and the financial highlights for each
of the periods indicated therein, in conformity with generally accepted
accounting principles.
COOPERS & LYBRAND L.L.P.
Portland, Oregon
February 12, 1998
82
<PAGE>
PROXY VOTING RESULTS
-----------------------------------------------------------------
On December 4, 1997, the Funds held a Special Meeting of Shareholders to
approve new investment advisory contracts with the Advisor. The need to approve
a new investment advisory contract was caused by the change in control of the
Advisor resulting from the acquisition of the Advisor by Fleet Financial Group,
Inc. A new investment advisory contract was approved by each Fund as shown
below:
<TABLE>
<CAPTION>
TOTAL
FUND OUTSTANDING FOR AGAINST ABSTENTION
- ----------------------------------- ------------ --------- ---------- -----------
<S> <C> <C> <C> <C>
Columbia Common Stock Fund......... 33,424,104 23,503,684 92,486 125,914
Columbia Growth Fund............... 34,932,310 18,670,005 323,723 442,534
Columbia International Stock
Fund.............................. 10,136,429 6,162,186 75,846 128,929
Columbia Special Fund.............. 66,728,987 35,764,587 603,044 1,097,275
Columbia Small Cap Fund............ 4,439,465 2,766,574 45,914 34,298
Columbia Real Estate Equity Fund... 7,395,725 4,826,934 70,141 52,743
Columbia Balanced Fund............. 36,136,805 19,709,041 97,202 240,899
Columbia Daily Income Company...... 875,748,841 464,677,559 11,346,679 10,251,952
Columbia U.S. Government Securities
Fund.............................. 4,525,865 3,140,210 15,454 39,456
Columbia Fixed Income Securities
Fund.............................. 27,941,833 15,526,380 226,012 255,217
Columbia Municipal Bond Fund....... 32,247,512 20,286,357 523,472 551,537
Columbia High Yield Fund........... 3,715,453 2,400,164 12,704 54,931
</TABLE>
<PAGE>
SHARES OF THE FUNDS ARE NOT BANK DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED OR
ENDORSED BY, FLEET FINANCIAL GROUP, INC. OR ANY OF ITS AFFILIATES, THE ADVISOR,
OR ANY FLEET BANK. SHARES OF THE FUNDS ARE NOT FEDERALLY INSURED BY, GUARANTEED
BY, OBLIGATIONS OF OR OTHERWISE SUPPORTED BY THE U.S. GOVERNMENT, THE FEDERAL
DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD OR ANY OTHER
GOVERNMENTAL AGENCY. INVESTMENT IN THE FUNDS INVOLVES INVESTMENT RISK, INCLUDING
THE POSSIBLE LOSS OF PRINCIPAL.
