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Previous: COLONIAL TRUST III, DEFS14A, 1997-08-21 |
Next: CONNECTICUT LIGHT & POWER CO, 8-K, 1997-08-21 |
<PAGE>
SEMI-ANNUAL REPORT TO SHAREHOLDERS
CIGNA FUNDS GROUP (UNAUDITED)
FOR THE SIX MONTHS ENDED JUNE 30, 1997
[TEXT APPEARS AS A DIVIDED CIRCLE GRAPHIC]
<PAGE>
CIGNA MONEY MARKET FUND
INVESTMENTS IN SECURITIES
JUNE 30, 1997 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL VALUE
(000) (000)
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
COMMERCIAL PAPER - 86.1%
Abbott Laboratories,
5.45%, 7/11/97 $ 816 $ 815
Armstrong World Industries, Inc.,
5.60%, 7/11/97 794 793
5.58%, 7/11/97 2,490 2,486
AT&T Co.,
5.49%, 7/1/97 2,000 2,000
Bell Atlantic Network Funding Corp.,
5.57%, 7/10/97 2,810 2,806
5.48%, 7/14/97 1,102 1,100
Bellsouth Telecommunications, Inc.,
5.46%, 7/2/97 4,600 4,599
Daimler-Benz North America Corp.,
5.55%, 7/15/97 4,455 4,445
Dillard Investment Co.,
5.55%, 7/16/97 5,000 4,988
Dow Jones & Co.,
5.55%, 8/4/97 4,174 4,152
Echlin Inc.,
5.60%, 7/7/97 5,700 5,695
Emerson Electric Co.,
5.45%, 7/7/97 175 175
Ford Motor Credit Co.,
5.58%, 7/3/97 3,900 3,900
GTE Funding Inc.,
5.58%, 7/15/97 5,000 4,989
Hershey Foods Corp.,
5.55%, 7/22/97 3,475 3,464
Hitachi America, Ltd.,
5.55%, 7/17/97 2,589 2,583
</TABLE>
The Notes to Financial Statements are an integral part of these statements.
<PAGE>
CIGNA MONEY MARKET FUND
INVESTMENTS IN SECURITIES (Continued)
JUNE 30, 1997 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL VALUE
(000) (000)
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Johnson Controls, Inc.,
5.57%, 7/14/97 $ 2,701 $ 2,696
Morgan, J.P. & Co., Inc.,
5.55%, 9/24/97 2,555 2,522
Paccar Financial Corp.,
5.55%, 7/16/97 230 229
PPG Industries, Inc.,
5.50%, 7/7/97 705 704
Rubbermaid, Inc.,
5.53%, 7/8/97 4,650 4,645
Southern Bell Telephone Co.,
5.58%, 7/8/97 767 766
Toshiba America, Inc.,
5.55%, 7/11/97 2,713 2,709
5.56%, 8/22/97 772 766
Weyerhauser Mortgage Co.,
5.56%, 7/9/97 5,200 5,194
-----------------
TOTAL COMMERCIAL PAPER 69,221
-----------------
U.S. GOVERNMENT & AGENCIES - 14.3%
Federal Farm Credit Bank, 1,030 1,030
5.93%, 7/1/97
Federal Home Loan Banks,
5.625%, 12/3/97 2,500 2,500
5.80%, 2/5/98 4,000 3,999
5.91%, 3/24/98 1,000 1,000
Federal National Mortgage Association,
5.50%, 2/18/98 850 849
United States Treasury Bills,
5.23%, 3/5/98 2,200 2,121
-----------------
TOTAL U.S. GOVERNMENT & AGENCIES 11,499
-----------------
</TABLE>
The Notes to Financial Statements are an integral part of these statements.
<PAGE>
CIGNA MONEY MARKET FUND
INVESTMENTS IN SECURITIES (Continued)
JUNE 30, 1997 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL VALUE
(000) (000)
- ------------------------------------------------------------------------------------------------------------------
<S> <C>
TOTAL INVESTMENT IN SECURITIES - 100.4% $ 80,720
(Total Cost - $80,719,858)
Liabilities, Less Cash and Other Assets - (0.4%) (295)
-----------------
NET ASSETS - 100.0%
(equivalent to $1.00 per share based on 80,425,354
shares outstanding) $ 80,425
=================
</TABLE>
The Notes to Financial Statements are an integral part of these statements.
<PAGE>
CIGNA INCOME FUND
INVESTMENTS IN SECURITIES
JUNE 30, 1997 (UNAUDITED)
<TABLE>
<CAPTION>
MARKET
PRINCIPAL VALUE
(000) (000)
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C>
BONDS AND NOTES - 91.0%
FOREIGN GOVERNMENTS - 8.6%
Israel (The State of)., 5.75%, 2000 $ 100 $ 99
--------------
U.S. GOVERNMENT & AGENCIES - 82.4%
Federal Home Loan Banks, 7.37%, 2002 100 103
Federal Home Loan Mortgage Corp., 7.75%, 2001 100 104
Federal National Mortgage Assoc., 7.4%, 2004 100 104
Student Loan Marketing Assoc., 6.6%, 1999 100 101
Tennessee Valley Authority, 6.375%, 2005 100 98
United States Treasury Bond, 8.125%, 2019 35 40
United States Treasury Notes,
5.875%, 1998 95 95
6.5%, 2005 300 299
--------------
944
--------------
Total Bonds and Notes
(Cost - $1,066,797) 1,043
--------------
SHORT-TERM OBLIGATIONS - 6.5%
COMMERCIAL PAPER - 6.5%
(Total Cost - $75,000)
Ford Motor Credit Co., 5.55%, 8/8/97 75 75
--------------
TOTAL INVESTMENT IN SECURITIES
(Cost - $1,141,797) 1,118
Cash and Other Assets, Less Liabilities - 2.5% 29
--------------
NET ASSETS - 100.0%
(equivalent to $.97 per share based on
1,186,905 shares outstanding) $ 1,147
==============
</TABLE>
The Notes to Financial Statements are an integral part of these statements.
<PAGE>
CIGNA FUNDS GROUP
STATEMENT OF ASSETS AND LIABILITIES (IN THOUSANDS)
JUNE 30, 1997 (UNAUDITED)
<TABLE>
<CAPTION>
MONEY
MARKET INCOME
---------------- --------------
<S> <C> <C>
ASSETS:
Investments in securities at value (Cost - $80,719,858
and $1,141,797 respectively) $ 80,720 $ 1,118
Cash 12 16
Interest receivable 242 20
Investment for deferred compensation plan (Cost - $14,895
and $9,081 respectively) 18 11
Receivable from advisor (33) 4
Other 1 2
-----------------------------------
Total assets 80,960 1,171
---------------- --------------
LIABILITIES:
Dividends payable 456 -
Payable for deferred compensation plan 18 11
Other accrued expenses 61 13
---------------- --------------
Total liabilities 535 24
---------------- --------------
NET ASSETS $ 80,425 $ 1,147
================ ==============
Shares outstanding 80,425 1,187
================ ==============
NET ASSET VALUE PER SHARE $ 1.00 $ 0.97
================ ==============
COMPONENTS OF NET ASSETS:
Paid in Capital $ 80,425 $ 1,145
Undistributed net investment income - 21
Accumulated net realized gain on investments - 3
Unrealized depreciation of investments - (22)
---------------- --------------
NET ASSETS $ 80,425 $ 1,147
================ ==============
</TABLE>
The Notes to Financial Statements are an integral part of these statements.
<PAGE>
CIGNA FUNDS GROUP
STATEMENT OF OPERATIONS (IN THOUSANDS)
FOR THE SIX MONTHS ENDED JUNE 30, 1997 (UNAUDITED)
<TABLE>
<CAPTION>
MONEY
MARKET INCOME
--------------- ---------------
<S> <C> <C>
INVESTMENT INCOME:
Interest $ 3,466 $ 36
--------------- ---------------
EXPENSES:
Investment advisory fees 218 8
Administrative services 36 9
Custodian fees and expenses 22 3
Auditing and legal fees 10 3
Trustees' fees 5 2
Transfer agent fees and expenses 2 2
Other 2 1
--------------- ---------------
Total expenses 295 28
Less expenses waived by advisor (15) (23)
--------------- ---------------
Net expenses 280 5
--------------- ---------------
NET INVESTMENT INCOME 3,186 31
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain from securities transactions 7 3
Unrealized depreciation of investments - (8)
--------------- ---------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS 7 (5)
--------------- ---------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 3,193 $ 26
=============== ===============
</TABLE>
The Notes to Financial Statements are an integral part of these statements.
<PAGE>
<TABLE>
<CAPTION>
CIGNA FUNDS GROUP
STATEMENT OF CHANGES IN NET ASSETS (IN THOUSANDS)
FOR THE SIX MONTHS ENDED JUNE 30, 1997 (UNAUDITED)
MONEY
MARKET INCOME
---------------- --------------
<S> <C> <C>
OPERATIONS:
Net investment income $ 3,186 $ 31
Net realized gain from securities transactions 7 3
Unrealized depreciation of investments - (8)
---------------- --------------
Net increase in net assets from operations 3,193 26
---------------- --------------
DISTRIBUTIONS TO SHAREHOLDERS:
From net investment income (3,186) -
From net realized capital gains (7) -
---------------- --------------
Total distributions to shareholders (3,193) -
---------------- --------------
CAPITAL SHARE TRANSACTIONS:
Net proceeds from sales of shares 374,851 -
Net asset value of shares issued to shareholders
in reinvestment of dividends and distributions 3,265 -
---------------- --------------
378,116 -
Cost of shares redeemed (418,196) -
---------------- --------------
Net increase from Fund share transactions (40,080) -
---------------- --------------
NET INCREASE (DECREASE) IN NET ASSETS (40,080) 26
NET ASSETS:
Beginning of period 120,505 1,121
---------------- --------------
End of period (including overdistributed net investment
income of $0 and $20,755, respectively) $ 80,425 $ 1,147
================ ==============
TRANSACTIONS IN CAPITAL STOCK:
Shares sold 374,851 -
Shares issued in reinvestment of dividends and distributions 3,265 -
---------------- --------------
378,116 -
Shares redeemed (418,196) -
---------------- --------------
Net decrease (40,080) -
================ ==============
</TABLE>
The Notes to Financial Statements are an integral part of these statements.
<PAGE>
CIGNA FUNDS GROUP
STATEMENT OF CHANGES IN NET ASSETS (IN THOUSANDS)
FOR THE YEAR ENDED DECEMBER 31, 1996
<TABLE>
<CAPTION>
MONEY
MARKET INCOME
---------------- ---------------
<S> <C> <C>
OPERATIONS:
Net investment income $ 1,593 $ 58
Net realized gain from securities transactions 14 -
Unrealized appreciation of investments - (42)
---------------- ---------------
Net increase in net assets from operations 1,607 16
---------------- ---------------
DISTRIBUTIONS TO SHAREHOLDERS:
From net investment income (1,593) (57)
From net realized capital gains (14) (38)
---------------- ---------------
Total distributions to shareholders (1,607) (95)
---------------- ---------------
CAPITAL SHARE TRANSACTIONS:
Net proceeds from sales of shares 283,028 -
Net asset value of shares issued to shareholders
in reinvestment of dividends and distributions 1,078 95
---------------- ---------------
284,106 95
Cost of shares redeemed (Note 6) (164,635) -
---------------- ---------------
Net increase from Fund share transactions 119,471 95
---------------- ---------------
NET INCREASE IN NET ASSETS 119,471 16
NET ASSETS:
Beginning of period 1,034 1,105
---------------- ---------------
End of period (including overdistributed net investment
income of $0 and $9,875, respectively) $ 120,505 $ 1,121
================ ===============
TRANSACTIONS IN CAPITAL STOCK:
Shares sold 283,028 -
Shares issued in reinvestment of dividends and distributions 1,078 95
---------------- ---------------
284,106 95
Shares redeemed (164,635) -
---------------- ---------------
Net increase 119,471 95
================ ===============
</TABLE>
The Notes to Financial Statements are an integral part of these statements.
<PAGE>
CIGNA FUNDS GROUP Notes to Financial Statements (Unaudited)
1. SIGNIFICANT ACCOUNTING POLICIES. CIGNA Money Market Fund and CIGNA Income
Fund are separate series of CIGNA Funds Group, a Massachusetts business trust
(the "Trust"). The funds are referred to collectively as "CIGNA Funds Group" or
the "Funds." The Trust is registered under the Investment Company Act of 1940,
as amended, as a diversified, open-end management investment company. The
objective of the Money Market Fund is to provide as high a level of current
income as is consistent with the preservation of capital and liquidity and the
maintenance of a stable $1.00 per share net asset value by investing in
short-term money market instruments. The objective of the Income Fund is to
provide as high a level of current income as possible consistent with reasonable
concern for safety of principal by investing primarily in investment grade
corporate debt securities and U.S. Government securities. The preparation of
financial statements in accordance with generally accepted accounting principles
requires management to make estimates and assumptions that affect the reported
amounts and disclosures in the financial statements. Actual results could differ
from those estimates. The following is a summary of significant accounting
policies consistently followed by the Funds in the preparation of financial
statements.
A. SECURITY VALUATION - Debt securities traded in the over-the-counter market,
including listed securities whose primary markets are believed to be
over-the-counter, are valued on the basis of valuations furnished by a pricing
service, which determines valuations for normal, institutional-size trading
units of such securities using market information, transactions for comparable
securities and various relationships between securities which are generally
recognized by institutional traders. Except for the Money Market Fund,
short-term investments with remaining maturities of up to and including 60 days
are valued at amortized cost, which approximates market. Short-term investments
that mature in more than 60 days are valued at current market quotations. The
investments in the Money Market Fund are valued at amortized cost, which the
Board of Trustees has determined constitutes fair value. Other securities and
assets of the Funds are appraised at fair value as determined in good faith by,
or under the authority of, the Board of Trustees.
B. SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME - Security transactions
are accounted for on the trade date (date the order to buy or sell is executed).
Interest income is recorded on the accrual basis. Securities gains and losses
are determined on the basis of identified cost.
C. FEDERAL TAXES - For Federal income tax purposes, each Fund in the Trust is
taxed as a separate entity. It is each Fund's policy to continue to comply with
the requirements of the Internal Revenue Code applicable to regulated investment
companies and to distribute all of its taxable income and capital gains to its
shareholders. Therefore, no Federal income or excise taxes on realized income or
net capital gains have been accrued.
D. DIVIDENDS - For the Money Market Fund, dividends from net investment income
and net realized gains are declared daily and reinvested monthly. Prior to April
19, 1995, dividends from net investment income were reinvested daily. For the
Income Fund, dividends from net investment income and net capital gains, to the
extent such gains would otherwise be taxable to the Fund, are declared and
distributed annually. Prior to April 19, 1995, dividends from net investment
income of the Income Fund were distributed daily.
Dividends and distributions are recorded by the Funds on the ex-dividend date.
The timing and characterization of certain income and capital gains
distributions are determined in accordance with Federal tax regulations which
may differ from generally accepted accounting principles. To the extent that
such differences are permanent, a re-class to paid in capital may be required.
<PAGE>
CIGNA FUNDS GROUP Notes to Financial Statements (Unaudited) (Continued)
2. INVESTMENT ADVISORY FEES AND OTHER TRANSACTIONS WITH AFFILIATES. Investment
advisory fees were paid or accrued to CIGNA Investments, Inc. ("CII"), certain
officers and directors of which are affiliated with the Funds.
Such advisory fees are based on annual rates of 0.35% and 0.5% applied to the
average daily net assets of the Money Market Fund and Income Fund, respectively.
CII has voluntarily agreed to reimburse each Fund for any amount by which its
expenses (including the advisory fee but excluding interest, taxes, amortized
organization expenses, transaction costs incurred in acquiring and disposing of
portfolio securities, and extraordinary expenses) exceed 0.45% and 1% of average
daily net assets of the Money Market Fund and Income Fund, respectively. Prior
to July 1, 1996 the expenses of Money Market Fund were limited to 0.7% of
average daily net assets.
Each Fund reimburses CII for a portion of the compensation and related expenses
of the Trust's Treasurer and Secretary and certain persons who assist in
carrying out the responsibilities of those offices. For the six months ended
June 30, 1997, the Money Market Fund and Income Fund paid $35,719 and $8,073
respectively.
CII is an indirect, wholly-owned subsidiary of CIGNA Corporation.
3. TRUSTEES' FEES. Trustees' fees represent remuneration paid or accrued to
trustees who are not employees of CIGNA Corporation or any of its affiliates.
Trustees may elect to defer all or a portion of their fees which are invested in
mutual fund shares in accordance with a deferred compensation plan.
4. PURCHASES AND SALES OF SECURITIES. Purchases and sales of securities,
excluding short-term obligations, for the six months ended June 30, 1997 were
as follows (shown in thousands):
<TABLE>
<CAPTION>
FUND PURCHASES SALES
- --------------------------------------------------- ------------------- ------------------
<S> <C> <C>
$ $
Money Market Fund - -
Income Fund - -
</TABLE>
There were no purchases and sales of U.S. Government obligations for the Income
Fund.
5. AGGREGATE GROSS UNREALIZED APPRECIATION/DEPRECIATION. The Income Fund had
aggregate gross and net unrealized depreciation for Federal income tax purposes
as follows (shown in thousands):
<TABLE>
<CAPTION>
UNREALIZED UNREALIZED NET UNREALIZED
FUND APPRECIATION DEPRECIATION DEPRECIATION
- --------------------------------------------------- ------------------- ------------------ ---------------------
<S> <C> <C> <C>
$ $ $
Money Market Fund - - -
Income Fund - 24 24
</TABLE>
As of June 30, 1997, the Money Market and Income Funds' cost of securities for
Federal income tax purposes was $80,719,858 and $1,141,797, respectively.
<PAGE>
CIGNA FUNDS GROUP Notes to Financial Statements (Unaudited) (Continued)
6. CAPITAL STOCK. Each Fund is a separate series of the Trust which offers an
unlimited number of shares of beneficial interest, without par value. At June
30, 1997 affiliates of CIGNA Corporation were the only shareholders of the
Funds.
7. FINANCIAL HIGHLIGHTS. The following per share data is computed on the basis
of a share outstanding throughout the period:
<TABLE>
<CAPTION>
NET
REALIZED
NET &
ASSET UNREALIZED DIVIDENDS
VALUE, NET GAIN (LOSS) TOTAL FROM FROM NET DISTRIBUTIONS
YEAR BEGINNING INVESTMENT ON INVESTMENT INVESTMENT FROM REALIZED TOTAL
ENDED OF PERIOD INCOME INVESTMENTS OPERATIONS INCOME CAPITAL GAINS DISTRIBUTIONS
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
MONEY MARKET FUND
1992 $1.00 $.0334 - $.0334 $.0334 - $.0334
1993 e 1.00 .0237 - .0237 .0237 - .0237
1994 e 1.00 .0337 - .0337 .0337 - .0337
1995 f 1.00 .0516 - .0516 .0516 $.0003 .0519
1996 1.00 .0480 $.0001 .0479 .0479 .0001 .0480
6/30/97 g* 1.00 .0252 $.0001 .0251 .0251 .0001 .0252
INCOME FUND
1992 $1.04 $.07 $(.01) $.06 $.07 $.01 $.08
1993 e 1.02 .06 .07 .13 .06 .08 .14
1994 e 1.01 .06 (.09) (.03) .06 - .06
1995 f .92 .06 .09 .15 .05 - .05
1996 e 1.02 .05 (.05) - .05 .03 .08
6/30/97 g* .94 .03 - .03 - - -
</TABLE>
<TABLE>
<CAPTION>
RATIO OF
NET NET RATIO OF NET
ASSET ASSETS AT EXPENSES INVESTMENT
VALUE, END OF TO INCOME PORTFOLIO
YEAR END TOTAL PERIOD AVERAGE TO AVERAGE TURNOVER
ENDED OF PERIOD RETURN (000) NET ASSETS NET ASSETS RATE
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
MONEY MARKET FUND
1992 $1.00 3.36 % $25,808 0.84 % 3.35 % -
1993 e 1.00 2.39 20,508 1.00 a 2.39 b -
1994 e 1.00 3.43 16,673 1.00 a 3.32 b -
1995 f 1.00 5.33 1,034 0.80 a 5.38 b -
1996 1.00 4.91 120,505 0.45 a 4.95 b -
6/30/97 g* 1.00 2.55 80,425 0.22 a 2.52 b -
INCOME FUND
1992 $1.02 7.08 % $20,588 0.90 % 7.29 % 23 %
1993 e 1.01 13.36 19,910 1.00 c 6.06 d 116
1994 e .92 -3.12 15,210 1.00 c 6.37 d 8
1995 f 1.02 16.21 1,105 0.95 c 6.50 d 45
1996 e .94 1.36 1,121 1.00 c 5.33 d -
6/30/97 g* .97 2.41 1,147 0.50 c 2.72 d -
</TABLE>
* Unaudited.
a. Ratios of expenses to average net assets prior to the reduction of advisory
fee were 0.23%, 0.69%, 1.21% and 1.11%, respectively, for the six months
ended June 30, 1997 and the years ended December 31, 1996, 1995 and 1994.
b. Ratios of net expenses to average net assets prior to the reduction of
advisory fee were 2.51%, 4.71%, 4.91% and 3.22%, respectively, for the six
months ended June 30, 1997 and the years ended December 31, 1996, 1995 and
1994.
c. Ratios of expenses to average net assets prior to the reduction of advisory
fee were 2.49%, 5.62%, 1.37% and 1.15%, respectively, for the six months
ended June 30, 1997 and the years ended December 31, 1996, 1995 and 1994.
d. Ratios of net investment income to average net assets prior to the reduction
of advisory fee were 0.72%, 0.72%, 6.08 and 6.22%, respectively, for the six
months ended June 30, 1997 and the years ended December 31, 1996, 1995 and
1994.
e. Net investment income per share has been calculated in accordance with SEC
requirements, except hat end of year accumulated/undistributed net
investment income has not been adjusted to reflect current year permanent
differences between financial and tax accounting.
f. Per share amounts have been calculated using the average shares method,
which more appropriately presents the per share data for the period since the
use of the undistributed income method did not accord with the results of
operations.
g. Beginning in 1996, each Fund is required to disclose the average commission
paid per transaction. Neither the CIGNA Money Market Fund nor the CIGNA
Income Fund has paid any commissions in 1996 and 1997.
<PAGE>
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